The Daily Digest (Surplus for state, Senate battles over payroll tax cut, Candidates target Newt)

The latest budget news is giving Gov. Dayton and the GOP controlled Legislature some breathing room. State Finance officials are predicting an $876 million budget surplus. By law, the state replenishes a nearly depleted cash flow account and budget reserve.

The key question is whether the forecast is a sign of economic recovery or the benefit of one-time money.

Bright spots: Minnesota’s economy is predicted to do better than national average. State spending hasn’t been as high as projected.

Bad signs: State faces $1.3 billion deficit in next budget cycle (and doesn’t include paying back K12 payment delay). Likelihood of a recession is high.

The forecast also projects a slow recovery.

MPR takes a look at how the surplus impacts the political battle over taxes and spending.

State leaders are tempering their enthusiasm for the forecast by saying they want to wait and see what happens in February.

Forecasters say it won’t be until 2014 until the state regains its pre-recession job numbers.

WCCO wonders whether the forecast will help with the Vikings stadium push.

Under the Dome

The Pi Press says Minnesota agrees to pay $3 million to patients abused in a treatment program.

A lawsuit has been filed over the treatment of disabled residents in a state-run institution.

An investigation into the Minneapolis Veterans Home found possible fraud in accounting practices at the home.

The Senate GOP votes to join a lawsuit to stop the union vote.

The Department of Education shuffles its staff.

Economy

Target holiday sales are slower than expected.

St. Paul’s Ford plant closes.

Vikings Stadium

Minneapolis officials will meet with Vikings leaders soon.

Congress

Al Qaeda claims to be holding a U.S. citizen in Pakistan.

President Obama ripped the Senate for failing to pass a payroll tax cut extension.

EPA faults Monsanto in rootworm cases.

A Senate panel weighs a ban on congressional insider-trading.

The House voted to end the presidential campaign fund.

DFL Sen. Al Franken questions smartphone logging software.

DFL Sen. Amy Klobuchar is pushing the FDA to look at a new standard for arsenic after a report found high levels of the compound in fruit juice.

The New York Times says former New Mexico Gov. Bill Richardson is under investigation.

Race for Congress

Republican Allen Quist officially launched his bid for Congress.

The UFCW is backing Democrat Rick Nolan’s bid for Congress.

Race for President

President Obama will make a play for Arizona as the state’s number of latino residents increase.

The Des Moines Register will release a poll this weekend.

Republican leaders still seem torn about Mitt Romney.

Newt Gingrich says he’ll be the GOP nominee.

GOP Rep. Michele Bachmann targets Gingrich saying he’s “memory challenged.”

Ron Paul called Gingrich a “flip-flopper.”

AP says Herman Cain’s campaign is all but over.

The news comes after Cain said his wife didn’t know about his friendship (and payments to) with his latest accuser.

Bachmann got her first Congressional endorsement.

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