• The Advocate's Fiscal Toolbox - Provides links to primary tools in understanding state tax and budget system, including the Department of Revenue's Tax Incidence Study, the Governor's Budget, and legislative fiscal notes.
  
  
• Minnesota Budget Bites Archive
  
  
• Handouts from Minnesota Budget Project Events
  
  
• Unallotment Resource Page - As the 2009 Legislative Session was coming to a close, Governor Tim Pawlenty surprised many by announcing that he would use his unallotment authority to resolve the state's remaining budget deficit.
  
  
• Sign Up for MBP Updates!

Highlights From the Archives

April 29, 2010 (Updated) - Revenue-raising options to help close Minnesota’s budget deficit - Minnesota needs a balanced approach to solving deficits, including raising revenues, which would enable the state to maintain core state investments in education, health care, job training and other services that help Minnesotans weather these tough times and position the state for when prosperity returns, Minnesota Budget Project.

April 7, 2010 - Step One: House, Senate and Governor agree to $312 million in budget reductions - Summary of round one cuts; the remainder of the deficit is likely to be solved through cuts to health and human services and possible cuts to K-12 education, Minnesota Budget Project.

January 2010 - November 2009 budget forecast: Continued economic woes bring more big deficits - The economy has been a big part of Minnesota’s budget problems, but not the only part. Minnesota also has a long-term structural budget problem that has resulted from past policy decisions.... Policymakers have the opportunity to leave a legacy and put the state on much stronger financial footing. It is possible to balance the budget in ways that ensure adequate revenues are raised, make the investments that Minnesotans expect for our economic well being and quality of life, and deal with structural problems to create a long-term, sustainable budget, Minnesota Budget Project.

• A drop in expected revenue has created a $1.2 billion budget deficit in Minnesota’s current two-year budget cycle, FY 2010-11, according to the state’s recently released November economic forecast.
  
  
• The Governor partially delayed payments to school districts in order to help balance the budget. The forecast assumes that the bulk of that money will be repaid in FY 2012-13. Continuing to delay those payments would decrease the deficit by $1.2 billion.
  
  
• The forecast assumes that a portion of the delayed school payments (the property tax recognition shift) will not be repaid in FY 2012-13. Repaying the property tax recognition shift in FY 2012-13 would add $562 million to the deficit.
  
  
• Minnesota received $816 million in “fiscal stabilization funds” that were used mainly to prevent cuts in E-12 education and reduce cuts in higher education, but also helped to avoid some smaller reductions in public safety and health and human services.
  
  
• One budget wild card is whether the federal government will approve another infusion of funds to states like what was done through the American Recovery and Reinvestment Act (ARRA).

September 8, 2009 - Unprecedented: Governor’s Unallotments Cut $2.7 Billion from State Budget - Governor uses unallotment powers to delay payments to school districts; no provision was made to pay school districts back, Minnesota Budget Project.

Unallotment mimics $1.8 billion delay of state aid payments and property tax receipts to schools
The Governor used his unallotment power to implement a $1.8 billion delay in payments to school districts. Normally, schools get 90 percent of state aid in one fiscal year and a 10 percent settle-up payment in the following fiscal year. Under unallotment, school districts will receive 73 percent of their state aid in one year and 27 percent in the next year. This action is a one-time accounting action that artificially lowers the current budget deficit by shifting when school districts receive aid. The Governor and House of Representatives both proposed similar shifts in state payments to schools during the 2009 Legislative Session and policymakers agreed to a such a shift when Minnesota last faced significant budget deficits in 2003.

This delay in payments could force some districts into drawing down cash reserves or resorting to short-term borrowing.

No provision was made to pay school districts back
It is also possible that the delay in payments could turn into an actual cut in funding to school districts, rather than just an accounting shift. First, there is some debate over whether the Governor has the authority to settle up with school districts in FY 2012-13, or whether repayment requires legislative action. Secondly, there is already a large projected deficit for the FY 2012-13 biennium, so in order to repay school districts, the state would need to raise additional revenues or cut spending significantly in other areas.

The Governor’s budget planning estimates assume that a portion of the shift will not be paid off, resulting in a $600 million cut to schools in FY 2012.

July 2009 - Surprise Resolution to Legislative Session Leaves Long-term Deficits - In June, the Governor announced his intent to use his unallotment power to implement a $1.8 billion delay in payments to school districts. There is some question, however, as to whether the Governor has the authority to pay school districts back in the future. So, unless the legislature acts, this could be a $1.8 billion cut in funding to schools, Minnesota Budget Project (Side-by-side comparison of the E-12 Education Proposals).

January 26, 2009 - Kitchen Table Budget Principles - The principles emphasize the importance of equity, citizen involvement, long-term investments, pursuing more resources, and of ensuring today’s decisions don’t undermine tomorrow’s prosperity, Organizing Apprenticeship Project and Minnesota Budget Project (Press Release).

January 2009 - Punting the Problem: 2008 Legislative Session ends with a short-term solution - In the 2008 Legislative Session, policymakers relied heavily on one-time revenues to solve the budget deficit, did little to solve the deficits already looming in the future, and cut significantly from the state's health and human services. New analysis from the Minnesota Budget Project, Punting the Problem: 2008 Legislative Session ends with a short-term solution, takes a close look at the outcomes of the last session and how those choices will impact the landscape for the 2009 Legislative Session, Minnesota Budget Project.

December 2008 - The Lost Decade: Taking a Closer Look at Minnesota’s Public Investments in the 2000s - Minnesota No Longer Above Average in State Investments in E-12 Education and Higher Education. State funding for E-12 education, higher education, child care assistance and affordable housing and homelessness prevention will all be at lower levels at the end of this decade than in Fiscal Year 2003, Minnesota Budget Project (Press Release ; E-12 Impacts Handout).

• January 2009 - Key Findings - E-12 Education: No Progress Since FY 2003.

October 2008 - Principles for a Fair Federal Budget and Tax System - Federal budget decisions also affect the State of Minnesota’s budget. One-fifth of Minnesota’s revenue comes from federal dollars. The Minnesota Budget Project put forth a set of four principles that federal policymakers should use to evaluate tax and budget proposals. 

May 6, 2008 - Tough Decisions in the 2008 Legislative Session leave even tougher choices for 2009 - Minnesota Budget Project Analysis of Governor, Senate and House 2008 Budget Balancing Proposals - The Governor proposes a small cut of $2.4 million in total general fund expenditures for K-12 education. The House proposal would increase total funding for K-12 education. The Senate proposal would slightly decrease overall funding for K-12 education, hides some significant changes within the budget.  Read the Full Issue Brief.  It's important.

April 15, 2008 - Minnesota Budget Project testimony at the Senate Finance Committee hearing - A good decision-making process depends on a well-informed debate which requires good information and ample public participation.

April 2008 - Revenue Shortfalls Mean Minnesota Faces Long-Term Budget Deficits - Minnesota State Legislature encouraged to find sustainable solutions, Minnesota Budget Project.

March 14, 2008 - Addressing Inequality: 2007 Legislative Session Still Leaves Many Children Behind - The 2007 Legislative Session began with great expectations, and hopes that the state could move forward on addressing growing geographic, economic and racial disparities and their negative effects on children. The Minnesota Budget Project finds the opportunities for positive change during the last session were constrained by competing demands for limited resources and the lack of political will to raise additional resources. Policy choices in health care, early childhood and K-12 education that could have reduced inequality are examined.

March 7, 2008 - President’s Proposed Budget Cuts Would Hurt Minnesotans and Increase Minnesota’s Budget Deficit - Cuts K-12 education 9% compared to FY 2004 ($43.0 million adjusted for inflation), Minnesota Budget Project.

February 28, 2008 - Enough is enough: It’s time to start acting beyond the current crisis - St. Paul, MN – The February Forecast to be released this morning is expected to show the State of Minnesota’s projected budget deficit has grown significantly since last fall. It was only last February, however, that we were reportedly enjoying a large surplus, Minnesota Budget Project.

January 2008 - Budget Reforms in the 2007 Legislative Session: Progress Lost to a Veto - Summary of good budget processes to promote responsible decision-making and their outcomes in the 2007 Legislative Session.

December 2007 - The November 2007 Forecast: Stormy Weather Ahead - The state’s November economic forecast predicts a weak economy and on-going state budget deficits. The budget choices made over the last ten years, combined with economic trends, have contributed to the current budget situation. Policymakers have the opportunity to make budget decisions in the 2008 Legislative Session that could put the state on a much stronger footing.

April 2007 - Tax Fairness Declining in Minnesota - Minnesota's Taxes: Who Pays and How Much? - Overview of Minnesota’s State and Local Tax System.

April 2007 - What's At Stake: Budget Reforms - One of the primary tasks before the Minnesota Legislature this session is to pass the state’s budget for the upcoming FY 2008-09 biennium. While much attention is focused on revenue and spending choices, policymakers are also considering changes to the budget-making process itself.

January 2007 - Governor's Budget Makes Little Progress on Narrowing Disparities, Improving Budget Process - The Minnesota Budget Project finds the Governor's budget is largely disappointing.

November 2006 - 2006 Budget Decisions Leave Much on the Table for 2007 - In the 2006 Legislative Session, policymakers focused on addressing immediate needs, missing the opportunity to offer comprehensive plans for moving the state towards a more positive future.

May 2006 - Sources of Revenue Considered in the 2006 Legislative Session - As the Governor and Legislature consider a supplemental budget for the 2006 Legislative Session, there are a number of financial resources they are proposing to use.

April 2006 - Minnesota's Taxes: Who Pays and How Much? - Changes over time have meant that taxes are lower, but fairness has begun to erode.

April 2006 - Minnesota's Budget Surpluses May Be Short-Lived - Minnesota's ability to fund current levels of services is at risk.

March 2006 - Follow the Dollars: State Budget Timeline

March 2005 - Testimony by the Minnesota Budget Project before the the House Tax Committee describes the impact of cuts made in past budget-balancing plans, and argues that a fairer way to balance the budget is to include raising revenues in a way that takes into account Minnesotans' ability to pay.