The new state economic forecast released on Thursday contains good news. For starters, the projected budget deficit for the next biennium shrunk to $627 million. This is an improvement of $463 million over the $1.1 billion deficit that initially projected in December.
The forecast also contains good news for the current biennium. The state is now projected to end the current biennium with a positive balance of $295 million. Under current law, $5 million of that will go into the state’s budget reserve and $290 million will go to repay the education funding shift. Schools should see an acceleration of aid payments soon and the additional funds should bring accelerate the payment schedule by four points to about 86.5/13.5.
Governor Dayton is expected to issue a revised budget proposal in about two weeks. Soon after that, legislative leaders will set budget targets for each area of the budget (education, human services, taxes, etc.). House rules require a budget resolution to be adopted no later than March 25, but House leaders have said they hope to do it sooner. Senate leaders will also set budget targets.
MREA has been urging the legislature in testimony and office visits with individual legislators to increase the K-12 funding target above the Governor’s $302 million. That amount is insufficient to cover inflationary and other cost pressures that schools are facing. Contact your legislators by Wednesday to urge them to make investments in education to provide the world’s best workforce.