(KNOX) – Minnesota Governor Tim Walz says the 2025 Legislature is in a good position to do a measured, responsible, bipartisan budget.
However, Minnesota’s economic forecast warns that future state budgets could have multi-billion-dollar deficits because of soaring costs for special education and long-term care.
“Those two are heavily driven by federal policy, federal regulation about having to deliver those services,” Walz told the media. “In the case of special education, we are obligated to deliver that, and when that law was passed, the federal government promised us 40% of the cost. They’ve never delivered more than 27% of that cost. It usually hovers slightly under 20%.”
Republicans, including Senate Minority Leader Lisa Demuth, say lawmakers must consider cuts in all areas of government.
“House Republicans do expect that Democrats will work with us to reign in the state budget so that we can avert this looming budget crisis,” Demuth began. “Even though it’s a few years off, now is the time to actually exercise caution. We have to stop the spending spree.”
Walz says entire state agencies could be eliminated…but not close the looming budget gaps.
“Very clearly, those things are going to have to be addressed, but this is not ‘Light your hair on fire’ that these things are there,” Walz said. “This is a stable, balanced budget with AAA Bond Rating and some of the highest labor participation rates and growing incomes.”
The Minnesota Legislature convenes in about a month.
