News that higher-than-expected tax collections will slash Minnesota's projected budget deficit by close to a third cheered area lawmakers in St. Paul Monday.
Rep. Paul Gazelka, R-Brainerd, said the projected budget shortfall was reduced from $700 million to $466 million as the result of increases in projected receipts from individual income taxes, corporate income taxes and sales taxes.
While he said this was a sign the state's economy is rebounding, it didn't mean the economy was out of the woods yet. He said the more optimistic revenue forecast will provide long-term flexibility in areas such as education and human services.
Rep. Larry Howes, R-Walker, said the good economic news is a sign that Minnesota has weathered the financial storm and the state is headed in the right direction.
He said state revenues have increased by $157 million from the November estimate and that when combined with current law spending changes, a $175 million budget balance is predicted.
Sen. Paul Koering, R-Fort Ripley, said the revenue forecast indicates the state is heading in the right direction.
"I think it sends an optimistic message that the economy is starting to take off," he said.
Although the state still has a budget shortfall, Koering said lawmakers should note that it's not as bad as originally thought. Lawmakers, he said, should ask themselves what sort of education and health care systems they want for Minnesota.
MIKE O'ROURKE can be reached at firstname.lastname@example.org or 855-5860.
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