Financial news good, but not great
Considering last May’s state revenue forecast, the new projections announced Tuesday are absolutely rosy. From a $2.4 billion shortfall in the current budget to a $641 million surplus is good news indeed. Even a projected $1.3 billion shortfall in the next budget is a welcome figure, compared to the $4.7 billion deficit projected in May.
But good news is not great news, sometimes. The deficit in the coming biennium must be dealt with, and care must be taken to use the surplus this year in a responsible manner.
Gov. Tim Walz indicated Tuesday that a primary use for the money should be to provide state aid to businesses and workers affected by the current shutdown of businesses and activities due to COVID-19. That would certainly be a good use, and we hope DFL and Republican leaders can agree quickly on a proposal that could be approved in a special session this month.
This could be a preview to the upcoming legislative session that starts Jan. 5. Crafting a budget is a challenging proposition in a Legislature where the DFL controls the House and the Republicans have the Senate. If they can work out an agreement on the aid package, they should be able to work together on a budget.