Minnesota's Budget Forecast a 'Pleasant Surprise' for District 39 Legislators

District 39A legislators said they are pleased with an improved revenue forecast for the state released yesterday by the Minnesota Management and Budget Office.

Rep. Rick Hansen (D-District 39A) called it “a pleasant surprise.”

The projected deficit for the 2012-2013 biennium is $1.2 billion less than previously estimated, driven mostly by changes to the capital gains forecast, according to the report.

Legislators and Governor Mark Dayton have been preparing to address a budget shortfall of $6.18 billion over the next two-year budget cycle. Now that number is just under $5.03 billion.

Dayton followed up the announcement with changes to his own budget plan, including elimination of a proposed three-percent surtax on top earners, and reducing cuts to health and human services. 

This is good news to Senator Jim Metzen (D-District 39), who has said he is reluctant to support significantly higher taxes for .

Metzen and Hansen have both opposed further cuts to nursing homes in particular.

It remains to be seen how Dayton’s priorities will impact any budget ultimately designed by the Republican-controlled legislature, whose leadership is opposing any tax increases.

The governor's budget still includes a fourth-tier tax rate of 10.95 percent for single filers with incomes of $85,000 or more, married couples earning $150,000 and head of household earners with incomes of $130,000 or more.

Metzen said thus far, neither side has moved away from their positions. “I don’t know the end game. I think there’s going to be a massive collision.”