MN Has $2.4B Surplus For 2023; A Looming Deficit Could Spell Trouble

ST. PAUL, MN — Minnesota’s budget and economic outlook remain stable in the current biennium, but a possible deficit looms, the state Management and Budget Office said Wednesday.

Minnesota has a $2.4 billion budget surplus, and state lawmakers will decide how to use that money during the next legislative session that starts in February.

"The near-term U.S. economic outlook has improved since February, driven by stronger than expected consumer spending, business investment, and employment," budget officials said.

But there could be trouble on the horizon.

State economists also projected a budget deficit during the 2026-27 fiscal year as a result of rising cost estimates in health and human services and education.

Democrats, who control both chambers of the state Legislature and the governor's mansion, passed a $72 billion two-year budget — the biggest in state history, according to the Star Tribune.

Lawmakers started this year's legislative session armed with a record-high $17.5 billion budget surplus, which went to expanding the state government and direct tax rebate checks to Minnesotans.