Minnesota's New State Leaders Need Budget Bifocals

They should focus both on near-term needs of those hurt by sluggish economy and on the state’s future economic prosperity

St. Paul, Minn., Dec. 1, 2010 – As Minnesota budget officials prepare to release the state's November Economic Forecast on Thursday, Minnesotans are still hurting. There are five unemployed workers for every job vacancy statewide. Foreclosures remain high. Economic forecasters now say the recovery will be slower than previously predicted.

The November forecast will update the size of the state’s budget shortfall. “State leaders need to craft a budget that responds to the immediate needs of residents still struggling in a weak economy — and they need to make the long-term investments critical to the state’s economic future,” said Nan Madden, director of the Minnesota Budget Project. “We need to take a balanced approach, including new revenue, that maintains investments in education, job training and health care that Minnesotans need today and position us for a stronger future.”

Among several polls, a fall Minnesota Poll said voters supported a balanced approach to the budget. In a three-way gubernatorial race, a majority of Minnesotans voted for one of the two candidates proposing a balanced approach that included both spending cuts and tax increases. A majority of states have used a combination of solutions in solving their own economic challenges.

The forecast is expected to show a worsening revenue shortfall and new leaders will have to answer Minnesotans’ questions about how we will continue to fund our state’s priorities.

“Crafting a budget is not simply working out a math problem,” said Madden. A cuts-only approach would do more damage to the economy. Drastic cuts would mean more firefighters, teachers, nurses and construction workers losing work and spending less in their local communities. Private vendors with state contracts will sell less of their product, from paper to concrete.

“Once we know the size of the challenge, our next Governor and Legislature will need to describe how the budget solutions they propose will create the thriving Minnesota we all want,” said Madden. The Minnesota Budget Project will release preliminary analysis of the budget forecast on Thursday, December 2.

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About the Minnesota Budget Project:
The Minnesota Budget Project, an initiative of the Minnesota Council of Nonprofits, provides independent research, analysis and advocacy on budget and tax issues, emphasizing their impact on low- and moderate-income Minnesotans.

About the Minnesota Council of Nonprofits:
The Minnesota Council of Nonprofits (MCN) is the statewide association of 2,000 nonprofit organizations. Through its website, resource publications, workshops and events, cost-saving programs and advocacy, MCN continually works to inform, promote, connect and strengthen individual nonprofits and the nonprofit sector.

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