On Tuesday, the Minnesota House and Senate leadership and Governor Tim Walz released
joint budget targets that lay out their agreed-upon priorities for use of the
state’s projected budget surpluses. For FY 2023-25, the three largest targets in dollar terms are for tax reductions and aids to local governments, K-12 Education, and funding for an infrastructure (bonding) bill.
Budget targets set the size of each omnibus budget bill, as well as the tax and bonding bills. They describe the net changes to state general fund spending in each budget area; in addition to changes in spending, they could also reflect revenue changes or transfers between funds. In most years, each legislative body sets their own targets to guide development of their budget bills, and reach agreement on targets later in the spring. However, this year, the governor and House and Senate leadership expedited the process by negotiating an agreement on global targets before omnibus bills in the House and Senate are released.
The agreement also sets targets for several bills that are travelling separately from the omnibus budget bills. These include bills to start a statewide Paid Family and Medical Leave program and Earned Safe and Sick Time.
Since the budget targets are only dollar figures – meaning that they set the size but not the content of the budget bills – they can produce more questions than answers. What specific items are included will become clear as the House and Senate release their omnibus budget bills over the next couple of weeks. Stay tuned to our Minnesota Budget Bites blog for more in-depth analyses as they are released.
| Global targets (by Senate committee jurisdiction) |
FY 2023-25 |
FY 2026-27 |
| Tax reductions and aids to local governments |
$3.0 billion |
$1.3 billion |
| Education Finance |
$2.5 billion (includes $300 million for children and families) |
$3.3 billion |
| Debt Service and cash for bonding |
$2.3 billion |
$0 |
| Health and Human Services |
$1.6 billion (includes $875 million for children and families) |
$1.4 billion |
| Health Care Access Fund (HCAF) financing |
-$622 million |
-$586 million |
| Human Services |
$1.3 billion |
$1.6 billion |
| Transportation |
$1.1 billion |
$130 million |
| Housing and Homelessness Prevention |
$1.0 billion |
$50 million |
| Jobs and Economic Development |
$990 million (includes $500 million federal match) |
$33 million |
| Judiciary and Public Safety |
$880 million |
$710 million |
| Education, Climate, and Legacy |
$670 million |
$90 million |
| Higher Education |
$650 million |
$450 million |
| State, Local Government and Veterans |
$528 million |
$265 million |
| Energy, Utilities, Environment, and Climate |
$255 million |
$10 million |
| Agriculture, Broadband, Rural Development |
$148 million (includes $100 million for broadband) |
$40 million |
| Commerce and Consumer Protection |
$10 million |
-$266 million |
| Elections |
$10 million |
$7.0 million |
| Labor |
$8.0 million |
$6.5 million |
| Other bills |
|
|
| Paid Family and Medical Leave |
$668 million |
$6.1 million |
| Pensions |
$600 million |
$0 |
| Lead lines |
$240 million |
$0 |
| Disaster relief |
$40 million |
$0 |
| Earned Safe and Sick Time |
$4.8 million |
$4.7 million |
| Claims bill |
$1.5 million |
$0 |
| Stadium (includes reserve impact) |
-$341 million |
-$398 million |
| Other items |
$310 million |
$98 million |
| Total |
$17.9 billion |
$8.2 billion |