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Minnesota Deficit Shrinks To Just Over $5 Billion

February 28, 2011, 10:20 AM

ST. PAUL, MN - A new economic forecast shows Minnesota's budget deficit has improved by more than a billion dollars, and now stands at $5 billion.

A copy of the budget forecast obtained by The Associated Press shows the deficit falling from an earlier projection of $6.2 billion. The forecast says federal tax cuts are behind the short-term improvement.

The forecast was due to be officially released shortly before noon Monday.

Democratic Gov. Mark Dayton and the GOP-controlled Legislature are split on how to handle the shortfall, with Dayton pushing for new high-end income and property taxes and Republican leaders vowing to balance the budget through spending cuts.  Dayton said earlier he might revisit his proposals to cut spending on nursing homes and home health care programs if the forecast improved.

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