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Dear Neighbor,
State officials issued a new economic forecast Wednesday and it shows a potential shortfall on the horizon, a dramatic swing from the series of record-setting surplus numbers Minnesota has experienced.
The report indicates the projected $2.4 billion surplus for the current biennium will be consumed by higher spending already in law over next two years. That is a problem, which raises questions over a potential shortfall for the biennium starting in July 2025.
This development comes after Democrats last May raised taxes by $10 billion and increased state spending by 40 percent despite a $17.5 billion state surplus.
We need to restore balance in St. Paul. The one-party rule in St. Paul went too far with historic increases in both taxing and spending and now reality is setting in. It?s rather concerning to think that in just a few short months the majority took our state from a $17.5 billion surplus to facing a potential shortfall.
In fact, the new economic forecast resorts to accounting shifts to keep our state in the black or a shortfall already would be showing for the next biennium. This path is not sustainable, and we need more balance in St. Paul to do the work of the people and get our state back on track.
While this news provides some direction as we prepare for the 2024 session, an updated February forecast will?serve as the official fiscal legislative framework for the 2024 session. Time will tell how our economy looks a few months from now, but the current forecast certainly calls for a more responsible approach than what happened last spring.
As always, your input is welcome.
Sincerely,
Dean
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