Oakdale's Legislators Happy but Cautious About Projected Minnesota Budget Surplus

Oakdale’s state legislators were surprised and pleased to hear news of a forecasted state budget surplus for this biennium Thursday, they said, but they were also cautious.

The Minnesota Management and Budget Office announced a forecast Thursday showing an $876 million surplus for the current biennium, according to a press release.

“We were expecting another deficit,” said Rep. Nora Slawik (DFL-Maplewood).

It wasn’t all good news, however, as the forecast also showed a $1.3 billion deficit for the next biennium, the release said.

“Short term, it could be worse,” said Sen. Chuck Wiger (DFL-Maplewood), “but we’re not out of the woods.”

Wiger said he wants the No. 1 priority to be paying back school districts money they’re owed by the state. The Association of Metropolitan School Districts reported earlier this week that a majority of its member districts— money to maintain an adequate cash flow.

State statute calls for the surplus money to go toward the state’s cash flow account and budget reserves, the release says.

If the projected surplus had been about $5 million higher, state statute would have mandated starting to pay back school districts, Slawik said.

“It would have been really great to pay off the school shift,” she said.

While the news is good right now, Slawik said legislators were cautioned that the European debt crisis and other economic instability could cause stock market losses, which could lower tax revenues.

“They just really cautioned us not to take this as everything’s going to turn around,” she said.

Both legislators said they’re now looking forward to the February forecast for more clues into the state’s long term financial situation.