The latest State Budget Forecast is great news for Minnesota! For the first time in seven years, the Forecast is predicting budget surpluses for our state’s current biennium and the next one. When I took office three years ago, the 2011 Forecast predicted a deficit of $5 billion for the next two years. This year’s Forecast predicts a surplus of $2.6 billion.
I propose to use one-half of the projected surplus, or $616 million, for middle-income and business tax cuts. I would put the other half into the Budget Reserve, with the understanding that none of it could be spent this year, except for critical needs, like the recent emergency propane purchases.
My top priority is to give a big part of the surplus back to Minnesotans by cutting taxes. I want to give $301 million worth of tax cuts to single and married taxpayers by matching our state tax code to the federal code. For example, I would eliminate the state’s marriage penalty (an average tax savings of $115 per couple), extend the working family credit to more families, increase the child care tax credit, and eliminate the tax penalties on people losing their homes to foreclosures.
I also want to save many businesses about $232 million in taxes by repealing the three “Business to Business” sales taxes added last year. It is essential that the legislature pass a bill with these middle-class tax cuts and business tax repeals very soon, so Minnesotans can benefit from them in this tax season.
I am pleased with our state’s progress, but definitely not satisfied. Too many Minnesotans have not felt benefits of this economic recovery. Over 137,000 people are still unemployed. Others can find only part-time work or are stuck in jobs they don’t want. At the same time, there are thousands of job vacancies throughout our state, where employers are unable to find workers with the skills they need.
We need to do a better job of preparing young people and retraining older workers for the good-paying jobs of the future. Now more than ever, the amount and quality of someone’s education and training will determine the person’s job, income, and other opportunities.
Minnesota’s main competitive advantages over other states and countries have always been the talents of our citizens and the quality of their educations. That is why our investments in better education are crucial to a better Minnesota.