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Minnesota state budget

Minnesota
Biennial
Fiscal Year 2012-2013
Signed into law July 20, 2011
GF Revenue


In the state of Minnesota, the Governor Mark Dayton signed the state budget into law on July 20, 2011, after a 20 day state government shutdown.[1] The shutdown occurred after the governor and legislature failed to negotiate a deal on on how to close a $5 billion deficit in the FY2012 state budget. The governor favored taxes and the legislature preferred spending cuts.[2]

On July 14, 2011, the governor and lawmakers reached a deal to end the standoff. The governor accepted the Republicans' offer of June 30, 2011, that balances the budget by $1.4 billion budget difference by delaying payment of school funds and borrowing against the state's tobacco settlement. In exchange, Republicans agreed to drop all controversial policy positions as well as their proposal to 15 percent of the state's work force and not pass a $500 million bonding bill.[3][4] A special legislative session began the afternoon of July 19, 2011, and lawmakers worked through the night to pass the nine budget bills.[5] The governor signed them hours after they were passed and the $35.9 billion budget took effect.[1] The state economist warned in October 2011 that the state would likely face another deficit due to economic growth of only 1.5% since the passage of the budget, which was based on a rate of 3.2%[6]

Minnesota has a total state debt of approximately $70,806,990,000, when calculated by adding the total of outstanding official debt, pension and other post-employment benefits (OPEB) liabilities, Unemployment Trust Fund loans, and the budget gap. [7]

See also: The Minnesota State Budget on State Budget Solutions

[edit] Fiscal Year 2012-13 State Budget

Gov. Dayton signed the $35.7 billion biennial state budget was signed into law on July 20, 2011. The budget makes big changes to education and also to health and human services.[8]

In December 2011, state budget officials delivered a surprise estimate of a $876 million surplus for the remainder of the state's budget due to revenues $358 million higher than expected and spending was $205 million less than prior estimates. By law, surpluses are supposed to go into two state funds: a budget reserve and a cash-flow account.[9]

State leaders revised that figure and announced on Feb. 29, 2012, that the state has a surplus of $323 million. The forecast document said that the first $5 million of the new surplus would refill the reserves back up to $653 million. Whatever amount remains of the surplus will be used toreduce the school payment shift put in place to close the budget deficit.[10]

Bond Sale

A state authority planned to finalize a bond sale late in mid-Nov. that leverages a portion of the state's tobacco lawsuit settlement reached in 1998. The state will sell $787 million worth of bonds, which will direct $640 million to patch a budget deficit and $150 million toward a debt reserve fund, set-up costs and other expenses that limit the amount available for budget purposes. The highest annual debt costs come toward the beginning, when the state's budget is already anticipated to be in rough shape. Officials are projecting $1.2 billion in total overall debt costs. Through the tobacco securitization bond sale, the state gives up rights to a big chunk of tobacco payments through 2031. Minnesota received about $170 million in 2010.[11]

Health and Human Services

The Health and Human Services portion of the budget is expected to be $11.3 billion.[8]

The budget cuts or delays millions of dollars in payments to hospitals, doctors and health plans. The budget penalizes hospitals that don't reduce the number of patients who reenter the hospital within 30 days of discharge and gives vouchers to move about 7,200 lower-income adults from the state-subsidized MinnesotaCare program onto private health insurance.[8]

Education

On April 5, 2012, Gov. Dayton vetoed a Republican plan to use state reserve to repay schools the $2.4 billion the state owes them due to accounting shifts and forced borrowing to avoid tax increases or deeper cuts elsewhere in the budget..[12]

Under the new budget, $700 million in funds due to districts statewide are delayed until the next two-year budget cycle..[8] The $700 million delay is in addition to a previous delay of $1.4 billion that has yet to be repaid.[13]

The delay of the funds will cost the individual districts. As of Dec. 1, 2011, at least 26 districts reported they'll have to borrow a total of $382 million to meet cash needs, incurring $3 million in financing costs.[14]

Transfer of Funds

The budget includes a requirement that the Counties Transit Improvement Board pay more for regional transit operations over the next two yearsl, meaning $15 million in additional expenses for the board whose funds come from a sales tax collected in five metro counties - Anoka, Dakota, Hennepin, Ramsey and Washington.[15]

Credit Rating

Despite ending the standoff, Moody's Investor Service down graded its outlook on Minnesota from stable to negative in light of the budget's reliance on one-time funds. Moody's said that Minnesota faces "significant obstacles" in achieving a structurally balanced budget in the next cycle as a result of those actions.[16] Moody's rates the state Aa+, and Fitch Ratings lowered the state's credit ranking to AA+ in July 2011. Standard & Poor's rated the state its highest rating of AAA,[17] but downgraded the state to AA+ in September 2011, citing “continued structural imbalance” in the state’s budget.[18]

[edit] State Government Shutdown

The budget was signed into law on July 20, 2011, after a 20 day state government shutdown.[1] The governor and legislature failed to negotiate a deal on the FY2012 state budget before the start of the fiscal year on July 1, 2012, and so on that date the state government shut down. The Democratic governor and Republican-controlled legislature could not reach an agreement on how to close a $5 billion deficit, with the governor favoring taxes and the legislature favoring spending cuts. This is the second state government shutdown in six years.[19]

The House signed off on the $13.6 billion K-12 education bill just over an hour after it was made public, and it contained includes a provision to delay an additional $700 million in school payments, a key part the final budget deal struck by Dayton and Republican leaders. [20] The passed budget relies on that money delayed from going to schools and from future payments on a legal settlement with tobacco companies to erase a $5 billion deficit through mid-2013. [1]

Deal Reached

A special legislative session began on July 19, 2011, and lawmakers worked through the night and passed the nine budget bills.[21]

On July 14, 2011, the governor accepted the Republicans' offer of June 30, 2011, that balances the budget by $1.4 billion budget difference by raising $700 million through bonds tied to a 1998 tobacco settlement and delaying $700 million in payments to school districts until FY2013 so that money isn’t counted in FY2012.[22] In exchange, Republicans agreed to drop all controversial policy positions as well as their proposal to 15 percent of the state's work force and not pass a $500 million bonding bill.[23][22]

Republicans had initially rejected in January the governor's bonding bill which provided $500 million for infrastructure and building projects, including construction and improvements at the state public universities and colleges, renovation of the Mayo Civic Center in Rochester and a new stadium for a minor league baseball team in St. Paul. Republicans agreed to the bonding bill as part of the budget compromise.[22]

Lawmakers said on Thursday, July 14, 2011, that they would hammer out the details of the deal and the move the bills through the required special session. Once they are approved the shutdown will officially end.[24]

Negotiations

"The governor is the only one who can call a special session, so he's in the driver's seat as to how long this shutdown lasts," Mr. Brodkorb said.[25] On June 23, 2011, Ramsey County District Judge Kathleen Gearin rejected the governor's request for a mediator to resolve the budget crisis, and she also rejected an argument by four GOP senators that she should order Dayton to call a special legislative session.[26] The governor has rejected Republican proposals to pass a "lights-on budget" and saying instead that he will not call a special session until an overarching agreement is reached.[27]

Gov. Dayton met with Republican lawmakers on July 5th, 6th and 7th, but the shutdown continued. On July 6, the governor offered Republicans the choice of offered the choice of hiking the state cigarette tax by $1 a pack or raising income taxes on Minnesota residents earning more than $1 million a year. Republicans rejected that choice.[28][27] On July 7, the governor met with Republican Senate Majority Leader Amy Koch and House Speaker Kurt Zellers. They discussed the K-12 budget but did not try to negotiate an overall budget deal.[29] On July 11, 2011, the governor offered to the millionaires tax in exchange for Republicans agreeing to other tax increases. Republicans rejected the offer.[30]

Former Democratic U.S. senator Walter Mondale and former Republican governor Arne Carlson formed a bipartisan, unofficial committee of former legislators and budget officials on July 5, 2011 to come up with a budget proposal. Gov. Dayton [27] The committee released this proposal on July 7, 2011. The plan proposes cutting projected state spending by $3.6 billion, which they said would amount to a 1.5 percent increase in each of the next two years, and also increasing income taxes on all earners and on alcohol and tobacco taxes to generate $1.4 billion. [31] The plan states "no shifts or gimmicks should be used to balance the budget." Under the plan, the overall two-year budget would be $35.6 billion although Republican lawmakers want a budget of no more than $34 billion.[32] Dayton issued a statement praising the commission for its work. He said the plan is in line with his budget proposal, but he took issue with the income tax hike on every Minnesotan.[33]

Millionaire Tax

The Governor wants to make budget cuts and raise some taxes, whereas Republicans opposed increasing taxes and rely on cuts. Gov. Dayton, a Democrat, wanted to spend $35.8 billion, funded in part by a $1.8 billion tax increase on the state’s top earners, whereas Republicans who hold House and Senate majorities said they will not spend more than $34 billion and they reject any tax increase.[34] Dayton's proposed "millionaire's tax" would mean that the 7,700 people making more than $1 million a year in Minnesota to pay higher income taxes, either permanently or as a two-year surcharge, which would generate $500 million to $700 million in revenue. The governor proposes adding 2 percent to the existing 7.85 percent income tax. That additional would put the state third in the nation for top income tax bracket tax. Minnesotans who make more than $1 million a year already are projected to pay $1.081 billion in state income tax for the 2011 tax year. [35]

Republicans defeated the governor's income tax measure on May 17, 2011, and the governor warned that he is prepared to take the budget fight into next year to get a tax increase through the Legislature.[36]

Impact of Shutdown

As a result of the government interruption, Fitch Ratings downgraded the state's bond rating from AAA to AA+ and cited as a result the "increasingly contentious budgeting environment." [37]

The shutdown has resulted in more than 20,000 employee layoffs. State employees were laid off rather than furloughed, so that they could collect unemployment during the shutdown. They did not receive severance packages.[38] Many lawmakers are still receiving pay although Forty-eight out of 134 House members and 14 senators deferred their pay — 31 Democrats and 31 Republicans. Employees deemed to be "essential" and still on the job are also still being paid. Included in the list of "essential employees" are the governor's chef and housekeeper.[39]

The stoppage meant the end non-emergency road construction, closure of the Capitol and stopped child-care assistance for the poor. More than 40 state boards and agencies are closed to working with only skeleton staff.[38]

The Minnesota Department of Transportation shut down more than 80 highway rest stops by early afternoon on June 30, 2011, and state parks are closed and have been since the start of the July 4th weekend.[40] Minnesota is losing an estimated $200,000 a day from the closure of state parks alone. Each day of the closure, the state loses $1.25 million a day in lottery sales. The Department of Transportation is forfeiting between $40,000 and $50,000 a week from uncollected MnPass tolls.[27] The Department of Natural Resources has estimated tourism losses of $12 million for each week the government is closed. [41]

Critical services, including the State Patrol, prisons, disaster response and federally funded health, welfare and food stamp programs, will continue.[42] As of July 6, 2011, a judge has been determining what services may continue during the shutdown and hs been holding hearings with individual social services groups that are waiting on inspections, licenses and background checks. The judge granted an exception to food banks and the governor requested on July 5, 2011, that the list be expanded to include special-education aid, addiction and mental health services, services for people with HIV and victims of domestic violence, sexual assault and other crimes.[27]

In anticipation of a government shutdown, on June 13, 2011 Lori Swanson, the state Attorney General, asked Ramsey County District Court to rule that some core functions of state government must continue even if a lingering stalemate over the budget forces it to shut down on July 1.[43]

Ramsey County Chief Judge Kathleen Gearin ruled on July 29, 2011, that core functions of government must continue in the event of a shutdown, but found that the court lacked the authority to order funding for the functions beyond the basic functions. The functions that would continue include basic care for Minnesotans in prison, nursing homes, veterans home and state hospitals, as well as funding for health care, computer system maintenance and internet security[44]

[edit] Governor's Proposed Budget

The state's last budget forecast anticipated a shortfall over $5 billion over two years starting in July 2011.[45] Estimates by state finance officials show that maintaining all programs currently mandated by state law would cost $5.8 billion more in the next biennial budget than the $33 billion the state spent in the prior biennium.[46] Gov. Mark Dayton presented his budget to the legislature on Feb. 15, 2011, and addressed the state's $6.2 billion deficit.[47] Minnesota's budget hole shrank by $1.2 billion thanks to a 2 percent federal payroll tax break passed by Congress in December 2010. In response Dayton announced he was withdrawing a proposal to impose a 3 percent surcharge on incomes over $500,000 a year and dropping $200 million in proposed cuts to health and human services programs. It was an announcement not well met by Republican members of the legislature who believed more cuts should be made. [48]

The budget proposal included cutting $950 million in planned spending from health care and higher education, among other categories, while increasing spending on K-12 education by $465 million.[47] In total the state budget reduces spending by $2.4 billion. [49] Lawmakers on June 6, 2011 criticized Gov. Dayton for failing to specify what many of those other budget cuts would be.[50]

Tax Increases

The governor said he wants to raise the state's top income-tax rate temporarily to 13.95 percent for single-filers making more than $85,000 annually, which would be the highest in any state. The governor also proposed raising the top rate on couples earning more than $150,000 of taxable income to 10.95%, up from 7.85% as well as adding a 3% surcharge on taxable income above $500,000 for the next two years. The governor expected the tax to generate $4.1 billion in new revenue. The governor also proposed creating a new, higher property-tax bracket for homes valued at more than $1 million.[47] Gov. Dayton's proposed income-tax increases are expected to generate $2.8 billion of new revenue.[47]

The governor also wants to require anyone living in Minnesota for more than 60 days per year to pay a prorated portion of their income taxes in Minnesota, which would change the current law requiring only those who live in Minnesota for more than six months of the year to pay state income taxes. The change would generate $15 million a year, according to state Department of Revenue projections.[51]

Within weeks of Gov. Dayton's budget, the Minnesota Senate soundly rejected his call to raise taxes on the wealthiest citizens. The Senate voted 63-1 against Dayton's proposal, with all Republicans and all but one Democrat joining in the majority. [52] Senate Republicans argued that Dayton's proposed tax increases would hurt the state's economic recovery. [53]

[edit] Public Union Response

Labor's response to Gov. Dayton's budget proposal was approving. [54] However, once the Republican legislative budget it introduced there may be demonstrations by public workers unions at the capital in protest.

[edit] Legislative Budgets

The legislature adjourned its regular session on May 23 pursuant to the state constitution.[55] A special session had not brought about an agreed upon budget by June 8, 2011.[56] If there is no budget by July 1, the state's government would begin shutting down.[57]

On June 6, Republicans proposed increasing spending on schools, courts and public safety by $110 million, which is closer to Gov. Dayton's proposed spending, although Republicans did not detail what would be cut to increase spending in those areas. [50] The next day, the parties were still quite far apart as of June 7, 2011, and some feared a state government shutdown, which would happen if an agreement is not reached by July 1, 2011.[50]

The House and Senate each passed budget bills, but they have not been reconciled and Gov. Dayton said that he would not start negotiating until Republicans sent him a complete, reconciled budget from both chambers. Republicans oppose raising taxes, but the governor is committed to increasing taxes on top earners.[58]

The Senate passed a bill on Feb. 3, 2011, eliminating $930 million from the state budget with cuts to colleges, local governments and public health programs.[59] The Republican legislative leadership has said any tax increases to fix the budget hole are off the table. [60]

In contrast to the governor's proposal to increase the tax rate for the wealthiest state residents, the House Tax Committee passed a bill that would cut income taxes for all Minnesotans, but could also force property tax hikes in cities across the state.[61]

The House passed $1 billion in cuts which were similar to temporary spending cuts imposed by former Gov. Pawlenty.[62][63] The bill reduces aid payments for local governments and cuts funding for colleges and community health programs.[62] Gov. Dayton said that they were "piecemeal cuts and partial solutions," that address only a portion of the state's $6.2 billion two-year budget hole.[63]

The Republican caucus is expected to introduce its budget proposal in the second week of March. Health and human services funding is expected to be hardest hit because it represents a third of general fund spending. HHS funding is slated to increase by nearly $4 billion in the next biennium. [64]

The budget battle between the legislature and governor is likely to come to a veto, because the Republicans are seeking deep cuts in aid to the Twin Cities and steep reductions to health and human services, which could boot thousands of Minnesotans off public programs. [65] The budget battle could last well into April, 2011.

House and Senate budget writers cut $1.8 billion from health and human services. [66]

[edit] Wisconsin Tax Reciprocity

Minnesota legislators are looking to reinstate tax reciprocity with Wisconsin. Many residents of both states work in the other state. Without reciprocity, thousands of people in both states this spring are filing tax returns to both Wisconsin and Minnesota. There was a reciprocity agreement between the two states, however it was killed after Wisconsin fell 17 months behind paying Minnesota the $60 million it was owed. [67]

[edit] Medicaid

While many states are looking to cut the number of Medicaid recipients, Minnesota has received permission to expand its rolls by 95,000. The expansion began March 1. 83,000 people who are enrolled in two state-funded programs, along with 12,000 uninsured, enrolled in Medicaid. Gov. Dayton told The Hill that Medicaid has more comprehensive benefits and lower co-pays than the the state programs — General Assistance Medical Care and MinnesotaCare. [68]

Gov. Dayton approved the expansion, something former Gov. Tim Pawlenty refused to do. Republican legislators opposed the move saying it ties up too much state money. Dayton said he would veto any legislation that attempts to reverse his decision. [69]

[edit] Budget transparency

Disregarding the mandate of Minnesota House File 548, State Government Omnibus bill (2007), Minnesota did not launch a spending database until March 2009 (over one year after the mandated launch date).[70][71] According to an article in the Star Tribune, the Department of Administration had not launched the website because "An old state computer system, which is being updated, is not Internet-friendly. It's not clear if the new computer system will include a spending database because the Legislature didn't appropriate the $1 million to $1.5 million needed for it."[72]

The actual expense of building the site was far less than initially expected. Curt Yoakum, Legislative Liason for the Department of Management and Budget in 2009, said that the spending database was developed with existing resources and a mere $5,000 consulting fee. Apparently the $1 million plus estimate was a bit high. The site's designers even overcame an antiquated accounting system that appeared unsuited to internet.

According to a press release from the Office of the Governor, "The site was created by Minnesota Management and Budget (MMB) and offers on-line, round-the-clock access to data on state payments for schools, local governments, contractors and other vendors. With just a few clicks, citizens can access detailed information on most state spending. The data is supplied by the state's accounting system and updated nightly."[70] Check it out by clicking here.

The Minnesota Office of Grants Management has made this website, where individuals can find out grants that are available.

Additionally, the Minnesota State Arts Board lists the recipients of its awards.[73] 2008 Media Grants, for example, were distributed to twelve individuals and cost a total of $59,000. They included grants for projects such as:
  • Nathaniel H. Freeman, Minneapolis
$6,000 — for a sixteen-stage video installation that shows the opening scene of sixteen imagined narratives, all informed by the people and events of his northeast Minneapolis neighborhood
  • Heather R. Johnson, Minneapolis
$5,000 — for a documentary film, titled, “No Ugly Trees,” that explores women's body and self-esteem issues
  • Daniel J. Lundquist, Bloomington
$5,000 — for creative time to finish hand coloring “Boris,” an animation about overcoming difficult circumstances to live a happy life[74]

[edit] Government tools

The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases
State DatabaseSearchabilityGrantsContractsLine Item ExpendituresDept/Agency BudgetsPublic Employee Salary
TAP MinnesotaY
600px-Yes check.png
N
600px-Red x.png
Y
600px-Yes check.png
N
600px-Red x.png
Y
600px-Yes check.png
P
Partial.png
  • The site provides salary schedules, as well as compensation totals for executive branch agencies and departments. Individual employee salaries, however, are not provided.[75]
  • Agency requests are included with final budget documents.[76]
See also: Evaluation of Minnesota state website

[edit] Limitations and Suggestions

Minnesota's "Transparency and Accountability Project" site lacks information about state employee salaries

[edit] Fiscal Year 2011 State Budget

Find the state’s FY2011 Comprehensive Annual Financial Report (CAFR) compiled by the state government here.

2011 State spending & deficit in billions[77]
Total spending Pension Health care Education Welfare Protection Transport Debt Budget gap
$20 $3.5 $10.6 $0.5 $3.4 $1.4 $1.7 $9.4 $3.1
2011 Local spending & deficit in billions[77]
Total spending Pension Health care Education Welfare Protection Transport Debt
$24.0 $0.4 $2.1 $9.9 $2.3 $2.7 $3.1 $31.6

[edit] Cash Crunch

To prevent the cash crisis, the administration delayed $141 million in payments to 134 school districts, deferring $89 million in aid to the University of Minnesota and delaying $221 million worth of tax refunds to Minnesota businesses until January.[78] The school districts had to use their own reserves or borrow money to pay their bills.[79]

The state's tax revenues were $55 million more than expected from July through September 2010.[80] An economic update released by Minnesota Management and Budget in Oct. 2010 showed that Minnesota is running $22 million behind for the full two-year cycle that runs through June 2011.[80]

[edit] Federal Funds

Minnesota received approximately $430 million from the federal government under H.R. 1586, a $26 billion plan to give states money for Medicaid and education that the President signed into law on August 10, 2010.[81][82] The governor waited until Sept. 8, 2010, to confirm that he would accept the $230 million in Medicaid funds that were part of the federal funds he had previously referred to as a "reckless spending spree."[83]

[edit] Passage of the Budget

Gov. Tim Pawlenty vetoed the state budget bill on May 11, 2010.[84] The veto gives the legislature under one week to address the budget deficit.[84] The vetoed bill included a new income tax bracket for couples earning more than $200,000 a year, and the governor's veto of the Democrat's proposed tax increase was his third in four years.[84] The Senate narrowly passed the measure 34-33 and the House of Representatives voted 71-63 for the budget balancing bill.[84]

Minnesota lawmakers approved $312 million in cuts to local governments, public colleges, farm programs and more after agreeing with Gov. Tim Pawlenty on the outlines of a partial deficit-reduction plan.[85] The bill addresses one third of the state's projected $1 billion budget deficit.[85] Legislators are anticipating that additional federal funds will be headed toward the state and are anticipating a relatively small gap to confront before their constitutionally mandated May 17 adjournment.[85]

Local government allowances were cut by $105, and while that is the largest blow in the bill, it is less than the $250 million cut sought by Gov. Pawlenty.[85] Additional cuts include[85]:

  • $47 million less for the state's universities and colleges
  • postponing a $260,000 upgrade to its dairy inspection and food monitoring system
  • $555,000 cut to the tourism promotion office
  • $770,000 less to the Historical Society

The Minnesota Supreme Court ruled that Gov. Pawlenty overstepped his authority by unilaterally cutting state funding for a small nutrition program before the budgeting process was complete but after the legislature had adjourned.[86] The governor's action is known as "unallotment."[87] The decision raised the possibility that others affected by the governor's $2.7 billion budget reductions could sue to have their eliminated funds restored.[86] Gov. Pawlenty called an emergency cabinet meeting on May 7, 2010 to plan possible reductions in state services should a court orders the state to make such payments, which it cannot afford.[86] Before the court ruling, Pawlenty and the Democratic-Farmer-Labor-controlled Legislature were making slow progress toward solving a $536 million budget deficit but the possibility of having to restore funding when the state does not have the money to do so threw a wrench into the budget plans.[86]

On May 8, 2010, Gov. Pawlenty threatened to shut down the state government if the legislature does not come to an agreement on a new FY2011 budget.[88]

Minnesota will receive approximately $430 million from the federal government under H.R. 1586, a $26 billion plan to give states money for Medicaid and education that the President signed into law on August 10, 2010.[81][82] The governor waited until Sept. 8, 2010, to confirm that he would accept the $230 million in Medicaid funds that were part of the federal funds he had previously referred to as a "reckless spending spree."[89]

[edit] Budget Background

Minnesota operates on a biennium, covering two fiscal years at a time. A fiscal year begins on July 1 and ends on June 30 of the following year, however the biennium begins July 1 of odd-numbered years. The process of creating a new state budget begins in even-numbered years. All state agencies submit budget requests for the next biennium along with actual expenditures and receipts for the two most recent fiscal years. The Governor then submits a three-part budget to the Legislature. Part one is a budget message, part two a detailed operating budget, and part three a capital expenditures budget. Parts one and two are presented to the legislature in January or February of odd-numbered years and part three is presented to the legislature in January of even-numbered years. Both the House and the Senate examine, modify, and enact the final budget. [90] [91]

Minnesota's “unallotment” law[92] specifies conditions under which the executive branch can reduce expenditures to prevent an anticipated budget deficit. The key part of the law provides:[93]

  • (a) If the commissioner [of finance] determines that probable receipts for the general fund will be less than anticipated, and that the amount available for the remainder of the biennium will be less than needed, the commissioner shall, with the approval of the governor, and after consulting the legislative advisory commission, reduce the amount in the budget reserve account as needed to balance expenditures with revenue.
  • (b) An additional deficit shall, with the approval of the governor, and after consulting the legislative advisory commission, be made up by reducing unexpended allotments of any prior appropriation or transfer. Notwithstanding any other law to the contrary, the commissioner is empowered to defer or suspend prior statutorily created obligations which would prevent effecting such reductions.

[edit] Budget figures

The following table provides a history of Minnesota's expenditures and gross domestic product (GDP).

Fiscal Year Expenditures (billions) GDP (billions)
2000 $35.4 [94] $185.1 [94]
2001 $38.0 [94] $190.2 [94]
2002 $40.5 [94] $198.6 [94]
2003 $41.3 [94] $208.2 [94]
2004 $42.1 [94] $223.5 [94]
2005 $42.9 [94] $232.0 [94]
2006 $44.8 [94] $242.1 [94]
2007 $46.7 [94] $255.0 [94]
2008 $48.7 [94] $268.5 [94]
2009 $50.8* [94] $282.8* [94]
  • NOTE: The figures for FY 2009 won't be finalized until the end of the fiscal year.


[edit] Accounting Principles

Main article: Minnesota government accounting principles

Minnesota auditing authority is divided between the State Auditor and the Legislative Auditor. The Office of the State Auditor is a constitutional office that is charged with overseeing more than $20 billion spent annually by local governments in Minnesota, publishing their audit reports online. The Office of the Legislative Auditor audits state agencies and constitutional offices, and also publishes their audit reports online.[95]

Rebecca Otto was elected Minnesota State Auditor in 2006.[96] Jim Nobles has been the Legislative Auditor for the State of Minnesota since 1983, an appointed position under the Legislative Audit Commission. In addition to the office's primary focus on state agencies and programs, they also audit three metropolitan agencies and selectively review programs that are administered locally.[97]

[edit] Stimulus

Minnesota received $4 billion in federal funding.[98]

[edit] Public Employees

According to 2008 Census data, the state of Minnesota and local governments in the state employed a total of 360,790 people.[99] Of those employees, 232,388 were full-time employees receiving a net pay of $1,043,514,803 per month and 128,402 were part-time employees paid $143,995,658 per month.[99] More than 54% of those employees, or 196,977 employees, were in education or higher education.[99]

[edit] See Also

[edit] External links

[edit] Additional reading

[edit] References

  1. ↑ 1.0 1.1 1.2 1.3 ABCNews.com "Minn. Governor Signs Budget, Ends State Shutdown" July 20, 2011
  2. ↑ MSNBC.com "Minn. government shuts down as budget talks fail" July 1, 2011
  3. ↑ The Minneapolis Star Tribune "Dayton agrees to June 30 GOP offer, with conditions" July 14, 2011
  4. ↑ Bloomberg "Minnesota Governor, Lawmakers Strike Deal" July 14, 2011
  5. ↑ Forbes "Minn. lawmakers convene to vote on ending shutdown" July 19, 2011
  6. ↑ Minnesota Public Radio "State likely to face another deficit" Oct. 7, 2011
  7. ↑ State Budget Solutions “Report reveals aggregate state debt exceeds $4 trillion” Oct. 24, 2011
  8. ↑ 8.0 8.1 8.2 8.3 The Minneapolis Star Tribune July 21, 2011
  9. ↑ The Washington Post "Good news: Minnesota, expecting worst, gets estimate of $876 million budget surplus" Dec. 1, 2011
  10. ↑ The Minneapolis Star Tribune "State has budget surplus of $323 million" Feb. 29, 2012
  11. ↑ Businessweek "Minn. burns future tobacco cash for budget fix now" Nov. 8, 2011
  12. ↑ The Minneapolis Star Tribune "GOP plan to repay schools vetoed" April 5, 2012
  13. ↑ The Minneapolis Star Tribune "School aid delay comes with some extra costs" July 26, 2011
  14. ↑ Minnesota Public Radio "Short on cash, school districts will borrow to meet expenses" Dec. 1, 2011
  15. ↑ Pioneer Press "State hijacks funds from five counties' local sales taxes to fix budget" Aug. 1, 2011
  16. ↑ The Wall Street Journal "Moody's Lowers Minnesota Outlook To Negative On Strained Finances" Aug. 1, 2011
  17. ↑ The Minneapolis Star Tribune "State braces for a costly S&P credit downgrade" Aug. 27, 2011
  18. ↑ Bloomberg "Minnesota Bonds Lose Top AAA Rating as S&P Cites ‘Imbalance’" Sept. 23, 2011
  19. ↑ MSNBC.com "Minn. government shuts down as budget talks fail" July 1, 2011
  20. ↑ The Minneapolis Star Tribune "Dayton signs budget, shutdown ends" July 20, 2011
  21. ↑ Forbes "Minn. lawmakers convene to vote on ending shutdown" July 19, 2011
  22. ↑ 22.0 22.1 22.2 Bloomberg "Minnesota Governor, Lawmakers Strike Deal" July 14, 2011
  23. ↑ The Minneapolis Star Tribune "Dayton agrees to June 30 GOP offer, with conditions" July 14, 2011
  24. ↑ Financial Times "Minnesota poised to end shutdown" July 14, 2011
  25. ↑ The Wall Street Journal "Minnesota Shutdown Continues; GOP Meets at Capitol" July 4, 2011
  26. ↑ The Minneapolis Star-Tribune "Judge won't order state budget mediation, special session" June 23, 2011
  27. ↑ 27.0 27.1 27.2 27.3 27.4 The Washington Post "Minnesota shutdown drags on" July 5, 2011
  28. ↑ The Wall Street Journal "No Progress in Minnesota Budget Stalemate" July 6, 2011
  29. ↑ Minnesota Public Radio "Shutdown Day 7: No budget offer from GOP but criticism for Dayton" July 7, 2011
  30. ↑ The Minneapolis Star Tribune "Dayton offer goes nowhere"July 12, 2011
  31. ↑ The Minneapolis Star Tribune "Budget panel offers its blueprint" July 7, 2011
  32. ↑ Minnesota Public Radio "Mondale/Carlson Commission: Tax cigs, alcohol and income" July 7, 2011
  33. ↑ Minnesota Public Radio "If it lasts, shutdown could make history" July 8, 2011
  34. ↑ Inforum "Minnesota budget talks back on" June 27, 2011
  35. ↑ The Minneapolis Star Tribune "Top earners cool to paying more" July 8, 2011
  36. ↑ The Minneapolis Star Tribune "Divide widens; vetoes loom" May 18, 2011
  37. ↑ Businessweek "Minnesota bond rating downgraded over budget woes" July 7, 2011
  38. ↑ 38.0 38.1 The Washington Post "No way to tell how much the Minnesota shutdown will cost" July 6, 2011
  39. ↑ The Washington Post "Minnesota government shutdown stirs accusations over who gets paid, who doesn’t and why" July 11, 2011
  40. ↑ CNNMoney.com "It's D-day for state budget" June 30, 2011
  41. ↑ Washington Post, Minnesota government shuts down, July 1, 2011
  42. ↑ Cite error: Invalid <ref> tag; no text was provided for refs named shurts
  43. ↑ Businessweek "Minn. AG starts legal preparations for shutdown" June 13, 2011
  44. ↑ The Minneapolis Star Tribune "Judge: Core functions must continue in shutdown" June 29, 2011
  45. ↑ The Daily Planet "State budget shortfall shrinks to $5.03 billion" March 1, 2011
  46. ↑ The Pioneer Press "3 Minnesota governor candidates: How they would balance state's budget" Oct. 25, 2010
  47. ↑ 47.0 47.1 47.2 47.3 The Wall Street Journal "Minnesota Considers Top-Tier Tax Boost" Feb. 15, 2011
  48. ↑ http://politicsinminnesota.com/blog/2011/03/minnesota%E2%80%99s-projected-budget-deficit-dropped-by-12b-but-tensions-still-remain/ Politics in Minnesota, Projected Budget Deficit Drops, But Tensions Still Remain, March 2, 2011]
  49. ↑ Review-News.com, Minnesota Budget Debate Begins, March 1, 2011
  50. ↑ 50.0 50.1 50.2 The Minneapolis Star Tribune "Budget talks: Another step backward" June 7, 2011
  51. ↑ Minnesota Public Radio "Dayton's snowbird tax plan may be hard to enforce" March 8, 2011
  52. ↑ Duluth News, Minn. Senate Rejects Dayton Income Tax Plan, March 2, 2011
  53. ↑ MPR, Dayton: Recess is Over, March 3, 2011
  54. ↑ Public News Service, Public Workers Unions Praise Dayton's State of the State, Feb. 10, 2011
  55. ↑ Waseca County News "Round one of Minnesota's budget complete" April 12, 2011
  56. ↑ []
  57. ↑ The Minneapolis Start Tribune "Divide widens; vetoes loom" May 18, 2011
  58. ↑ Minnesota Public Radio "Work on Minn. budget bills expected to pick up as Legislature edges toward deadline" May 9, 2011
  59. ↑ Bloomberg "Senate takes $930M whack at Minn. budget shortfall" Feb. 3, 2011
  60. ↑ Politics in Minnesota, Projected Budget Drops, But Tensions Still Remain, March 2, 2011
  61. ↑ Minnesota Public Radio "GOP income tax cut bill advances in Minn. legislature" March 20, 2011
  62. ↑ 62.0 62.1 "Minn. House passes 1st wave of budget cuts" Jan. 27, 2011
  63. ↑ 63.0 63.1 The Minneapolis Star Tribune "Minn. GOP's first budget pass: $1 billion in trims" Jan. 19, 2011
  64. ↑ Politics in Minnesota, Projected Budget Drops, But Tensions Still Remain, March 2, 2011
  65. ↑ Star Tribune, Minnesota GOP Legislators Rushing to Craft State Budget, March 27, 2011
  66. ↑ Star Tribune, Minnesota GOP Legislators Rushing to Craft State Budget, March 27, 2011
  67. ↑ Pierce County Herald, Legislature to Look at Wisconsin- Minnesota Tax Reciprocity again, March 3, 2011
  68. ↑ The Hill, Minnesota Expands Medicaid Coverage, Feb. 17, 2011
  69. ↑ Business Week, Minnesota gets OK from feds on Medicaid expansion, Feb. 17, 2011
  70. ↑ 70.0 70.1 Office of the Governor, "GOVERNOR PAWLENTY UNVEILS NEW STATE WEBSITE TO ALLOW CITIZENS TO TRACK GOVERNMENT SPENDING ONLINE," March 26, 2009
  71. ↑ Minnpost.com, "Many states, including Minnesota, lag in putting their spending on the Internet," February 27, 2009
  72. ↑ Star Tribune, "A blogger's quest: Where's the database?" May 15, 2009
  73. ↑ Minnesota State Arts Board website
  74. ↑ 2008 Grant Recipients, Artists Initiative
  75. ↑ Salary plans
  76. ↑ Minnesota Management and Budget
  77. ↑ 77.0 77.1 USA Spending, State Guesstimated* Government Spending
  78. ↑ Businessweek "Governor: Minnesota 'unlikely' to tap credit line" Sept. 9, 2010
  79. ↑ The Minneapolis Star Tribune "State taps schools for another $142 million" September 25, 2010
  80. ↑ 80.0 80.1 Businessweek "Minn. tax revenues up $55M for most recent quarter" Oct. 11, 2010
  81. ↑ 81.0 81.1 Federal Fund Information for States “ARRA FMAP Extension & Education Jobs Fund Totals” Aug. 11, 2010
  82. ↑ 82.0 82.1 The Minneapolis Start Tribune "Obama signs $26B stimulus package -- $430M for Minn." Aug. 10, 2010
  83. ↑ The Minneapolis Star Tribune "Pawlenty to feds: We'll take the cash" Sept. 7, 2010
  84. ↑ 84.0 84.1 84.2 84.3 Minnesota Public Radio "Pawlenty vetoes state budget bill as session erodes" May 11, 2010
  85. ↑ 85.0 85.1 85.2 85.3 85.4 Business Week "Minn. lawmakers sign off on $312M in budget cuts"March 30, 2010
  86. ↑ 86.0 86.1 86.2 86.3 Pioneer Press "If you thought the state's budget was shaky before ..." May 6, 2010
  87. ↑ Twin Cities Daily Planet "Unallotment undone" May 9, 2010
  88. ↑ Cite error: Invalid <ref> tag; no text was provided for refs named ksfy
  89. ↑ The Minneapolis Star Tribune "Pawlenty to feds: We'll take the cash" Sept. 7, 2010
  90. ↑ Minnesota Legislative Reference Library,"Resources on Minnesota Issues State Budget," December 2008
  91. ↑ Minnesota Management and Budget,"2010-11 Governor's Budget Instructions & Forms," retrieved March 18,2009
  92. ↑ Minnesota Office of the Revisor of Statutes, "Minn. Stat. § 16A.152, subd. 4.," retrieved October 27, 2009
  93. ↑ Minnesota House of Representatives Research Department, "Unallotment: Executive Branch Power to Reduce Spending to Avoid a Deficit," March 2008
  94. ↑ 94.00 94.01 94.02 94.03 94.04 94.05 94.06 94.07 94.08 94.09 94.10 94.11 94.12 94.13 94.14 94.15 94.16 94.17 94.18 94.19 US Government Spending,"Minnesota State and Local spending," retrieved March 17,2009
  95. ↑ Minnesota Office of the State Auditor Web site, retrieved October 27, 2009
  96. ↑ Minnesota Office of the State Auditor Web site, retrieved October 27, 2009
  97. ↑ Minnesota Office of the Legislative Auditor Web site, retrieved October 27, 2009
  98. ↑ Recovery, "Stimulus Spending by State"
  99. ↑ 99.0 99.1 99.2 2008 Minnesota Public Employment U.S. Census Data
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