On Tuesday, Minnesota Management and Budget (MMB) released an updated budget forecast, which projects an estimated budget deficit of $2.426 billion for the 2020-2021 biennium. The updated forecast, which is used to guide consideration of spending bills at the legislature, anticipates dramatically lower revenues as a result of the coronavirus pandemic. In accordance with state law, the balance of the state’s budget reserve is $2.359 billion. Senator Torrey Westrom (R-Elbow Lake) made the following statement regarding the budget news –

“This is a classic Minnesota ‘Uff Da’ situation! The legislature will continue to do everything we can to handle this bad news; the first step we took was to enact a salary and hiring freeze across the Senate, though we know harsher measures will likely be needed. The legislature and Governor will need to re-negotiate contracts to minimize the large number of state workers that could otherwise face deep-cutting lay-offs from these rapidly occurring budget shortfalls. Additionally, I have more caution regarding the bonding bill this year.  Our infrastructure is very important, but, priority number one is getting Minnesota safely reopened and our economy re-started. Without that, there will be no revenues contributing to the state budget and essential state programs will suffer. The State Senate is developing a COVID-19 Economic Recovery Taskforce immediately, to consolidate resources and get Minnesota on the right track as soon as possible. This entire financial picture has changed within the past six weeks, since Governor Walz declared the State of Emergency on March 13.  Unfortunately, it could get worse before it gets better, so we all need to prepare for a bumpy road ahead.”