Minnesota Management and Budget officials, including Commissioner Erin Campbell, State Economist Dr. Laura Kalambokidis, and State Budget Director Ahna Minge, presented the State’s November 2023 Budget and Economic Forecast on Dec. 6. Governor Walz, House Speaker Melissa Hortman and Senate Majority Leader Kari Dziedzic provided insights and addressed reporters’ questions. The state’s current biennium indicates stability in the budget and economic outlook, with a projected surplus of $2.4 billion for FY 2024-25. The surplus is $808 million above what was estimated at the end of the 2023 legislative session, driven by increased consumer spending and corporate profit growth. Much of this projected surplus is expected to be one-time money (as opposed to ongoing spending).
While recent revenue updates show a positive trajectory, concerns arise for FY 2026-27 due to increased spending in health and human services and education. Commissioner Campbell expressed optimism in the short term, but House Speaker Hortman highlighted the need for bipartisan cooperation for a capital investment bill, hinting at a potential bonding bill of $1.7 billion with GOP support or $800 million if pursued solely by Democrats.
SPECIAL ELECTION RESULTS
In a closely watched Minnesota House special election for District 52B, Democrat Bianca Virnig secured 58 percent of the vote, defeating Republican Cynthia Lonnquist with 40 percent of the vote. Virnig, a member of the Rosemount-Apple Valley-Eagan school board, will now fill the seat vacated by former DFL Representative Ruth Richardson. The election will not alter control of the chamber, yet it attracted attention for its significance as a rehearsal for messaging strategies leading up to next fall’s elections.
STATE OFFICE BUILDING RENOVATION
Renovation and expansion of the Minnesota State Office Building (SOB) has started. The first phase will include closure of the tunnel between the SOB and the Capitol building, as well as the closure of the north entrance into the building. The SOB will be closed completely for interior renovation of the building after the 2024 legislative session wraps up.
The project will add 166,000 square feet to the building, aiming to increase meeting space and accessibility for the public. The cost of the project will total $730 million with interest on bonds.
DATES TO REMEMBER
February 12: First day of 2024 legislative session
May 20: Adjournment of the 2024 legislative session