State Finance officials are expected to announce this morning that the current two-year budget has a $323 million surplus, according to a person who has been briefed on the number.
The forecast comes just three months after State Finance officials announced that the state had an $876 million surplus. By law, that money was used to fill the state budget reserve and the state’s cash flow account.
Gov. Dayton and state lawmakers will use the latest forecast to make spending decisions during the current legislative session. But there are already a lot of spending commitments in law. For example, state law says an additional $5 million needs to be placed into the state’s budget reserves. The law also requires that the state start paying back a K-12 school shift that was used to erase a $5 billion budget deficit last year.
Several Republicans have said that they want to dedicate the money to start repaying the $2.2 billion school shift. But GOP House Majority Leader Matt Dean said there could be pressure from other members to spend the money on other things. He said his caucus will start discussing those ideas in the next week or two.
Update: The forecast is projecting a $1.1 billion deficit for the next two-year budget cycle. That budget will have to be balanced by the next Legislature.
State Finance officials will officially release the report at 11:45 this morning. Gov. Dayton is scheduled to brief reporters at 12:45.