It comes just months after a $1.3B deficit prediction, but nothing is certain.
Minnesota’s financial outlook has dramatically improved one year into the COVID-19 pandemic, with state economists projecting a surplus of $1.6 billion for the next two-year budget.
The sharp economic upswing comes just three months after budget officials predicted Minnesota would face a $1.3 billion deficit in the next budget cycle. Economists said federal relief efforts helped change the economic picture, along with a boost in consumer spending when people got stimulus checks, relaxation of some COVID restrictions and progress on vaccines. The state is also spending less than anticipated, particularly on child care assistance and education.
“While the sun is starting to shine, we are hardly in the clear and we continue to have uncertain times,” Minnesota’s top budget official Jim Schowalter said. “We know a lot of this is based upon anticipated federal pandemic response. That money is not in the bank.” Continue reading.