State Budget Forecast shows $2.465 Billion Surplus

Minnesota Management and Budget (MMB) today issued the latest Budget and Economic Forecast. For the current budget period FY 2026-2027, there is a projected surplus of $2.465 billion due to what MMB says is a “better-than-expected fiscal year close and higher near-term revenue collections”. These increased revenue collections were partially offset by increased spending estimates.

MMB characterizes the state budget and economic outlook as “stable” for FY 2026-2027 with “structural” challenges in FY 2028-2029. Higher health care costs and slow economic growth cause a $2.96 billion projected deficit in FY 2028-2029. The budget reserve is $3.711 billion.