Latest news with #MinnesotaManagementandBudget
Yahoo
25-03-2025
- Business
- Yahoo
Gov. Walz calls state employees back to the office part time
Gov. Tim Walz gives remarks at Minnesota Management and Budget's economic forecast announcing a $3.7 billion surplus on Feb. 29, 2024. Courtesy of Senate Media Services. Gov. Tim Walz announced on Tuesday that most state employees will be required to return to the office for at least half of their scheduled workdays beginning June 1 as more companies and government leaders shift away from remote work that exploded during the COVID-19 pandemic. 'This approach balances the flexibility of telework with the workplace advantages of being in office,' Walz said in a release. 'Having more state employees in the office means that collaboration can happen more quickly and state agencies can build strong organizational cultures more easily.' Walz's office said about 60% of state government workers currently work in-person and about 60% also worked in person during the pandemic. Still, much of Minnesota's government employees have yet to return to the office fully in the years since the pandemic. Employees who live more than 75 miles away from their primary work location are exempted from the new policy, Walz's office stated. The expansion of remote work during the pandemic has been a boon to both office employees, who can work in sweatpants and skip the daily commute, as well as employers, who've been able to downsize and cut their office costs. But there have also been concerns about a drop in productivity and collaboration from the shift to remote work as well as the cost to downtowns, which rely on the 9-to-5 workers to shop and eat-out at local businesses. Walz's order follows the Trump administration's move to mandate all federal employees back to the office, which has caused chaos in some agencies without enough office space and parking to accommodate all of their workers. Like Trump's order, Walz's directive may face resistance from the state's public sector unions, though they did not immediately respond to requests for comment. St. Paul Mayor Melvin Carter also recently called city employees back to the office at least three days a week beginning April 1. Earlier this month, California Gov. Gavin Newsom issued an executive order requiring agency employees to return to the office for at least four days per week. Newsom has harbored hopes for a presidential run, and has tried to align himself with more conservative policies. Walz appears to also have presidential ambitions. In recent weeks, he has been on the road in Iowa, Wisconsin and most recently Rochester, Minnesota, to host town halls in Republican districts, fueling speculation that he's gauging a 2028 presidential run.
CBS News
21-03-2025
- Business
- CBS News
Gov. Walz's revised budget cuts hundreds of millions with deficit looming
Weeks after budget forecasters predicted a precipitous drop in Minnesota's surplus, Gov. Tim Walz has released a revised budget that his office says cuts hundreds of millions of dollars in spending in the coming years to fend off an impending deficit. The budget revision, which is a legally required annual move, cuts $162 million from the 2026-2027 budget and about $247 million from 2028-2029. The cuts come from several state grants and programs, with some of the larger reductions coming from charter schools, payments to counties to offset tax loss and transit funding in greater Minnesota. New spending in the budget, according to Walz, includes money for law enforcement training and bird flu response. The revised budget maintains pillars of Walz's original proposal , including cutting the statewide sales tax by .075% while expanding the sales tax base, an anti-fraud package and increased accountability for health insurers. It also keeps cuts to special education, state funding for private schools, Medicaid programs and more. If approved by the Legislature, the budget would keep more than $2.3 billion on the bottom line for the next two-year budget. "The revised budget curtails spending growth while maintaining key services that improve Minnesotans' lives," Minnesota Management and Budget Commissioner Erin Campbell said. "This budget is fiscally responsible and recognizes the need to take action now to address the imbalance in revenues and spending long-term." More details about the revised budget can be found on Minnesota Management and Budget's website . Earlier this month, Minnesota Management and Budget forecast a $456 million surplus for fiscal years 2026 and 2027, a reduction of $160 million from the previous forecast. The office cited state spending and "shifting policies at the federal level" as reasons for the shrinkage. Additionally, the office said if the state continues to outspend its revenue growth, there will be a deficit of nearly $6 billion in future years, an increase from the $5.1 billion deficit previously predicted. The Legislature will have to agree on a budget by the last day of session, which is May 19. If they don't, lawmakers will have to go into special session. Without a budget, the state government would shut down starting July 1.
Yahoo
07-03-2025
- Business
- Yahoo
Federal uncertainty and inflation lead to a gloomy Minnesota budget forecast
Gov. Tim Walz takes questions following the release of the state's November budget forecast in December 2024. Photo courtesy of Minnesota House Public Information Services. Minnesota's budget agency on Thursday said stubborn inflation is causing the state's looming multi-billion dollar deficit to grow, while providing a snapshot of Minnesota's current economic outlook. But all of that could be quickly upended by President Donald Trump's sweeping economic policies and slashes to federal spending. In the remaining 10 weeks or so of the legislative session, lawmakers will work in earnest to craft a two-year budget that will likely top $60 billion, funding everything from roads and schools to parks and social services. It will be a difficult feat with swiftly changing federal policies, Minnesota's split Legislature and entrenched partisanship. Here's some takeaways from Thursday's forecast. Budget analysts project that state lawmakers will have a $456 million budget surplus to craft their two-year budget — $160 million less than November estimates. Minnesota's increasing costs are expected to outpace revenue, potentially causing a nearly $6 billion budget deficit during the two years beginning in July 2027 — $852 million worse than November estimates, largely due to higher-than-expected inflation. This is all quite a contrast from two years ago, the last time the Legislature gathered to craft a budget. Then, the Democratic-Farmer-Labor trifecta approved a $72 billion budget fueled by a $17 billion surplus, a large increase in state spending that included lots of one-time expenses. Minnesota Management and Budget now says lawmakers won't enjoy a large cash heap like they did two years ago, and lawmakers need to be careful about ongoing spending, otherwise Minnesota could end up nearly $6 billion in the red. What's causing it? Increasing costs of disability services and special education are still the biggest drivers of the projected deficit. Trump's policies, including tariffs, tax and spending cuts and deportations, as well as the policy uncertainty and chaos that are his forte, could depress business activity and erode consumer confidence, but at the moment it's not clear exactly what cocktail he's brewing. Minnesota lawmakers will have to draft a budget without knowing the full impact of Trump's policies. Since taking office, Trump and Elon Musk's Department of Government Efficiency have laid off about 62,530 workers over the past two months from the federal government. Minnesota is home to 18,000 civilian federal employees. Trump has also proposed sweeping new tariffs on Canada, Mexico and China; Trump said Thursday he is delaying the new tariffs on Canada and Mexico another month after stocks tumbled when they took effect earlier this week. Disruptions from Trump's attempts to freeze federal funding have also impacted several Minnesota programs. Minnesota Management and Budget Commissioner Erin Campbell was at times understated during a budget presentation Thursday. 'In the weeks and months ahead, Minnesota policymakers will need to decide how to account for the potential impacts of federal actions and the growing projected deficit in the planning years.' At other moments, Campbell was blunt: 'The impact on the state budget could be really devastating.' About one-third of Minnesota's budget comes from the feds, and in fiscal years 2026-2027 MMB projects the state will receive $45 billion in federal funds — over half of which includes Medicaid. Last week, the U.S. House passed a budget resolution that calls for $880 billion in cuts to programs overseen by the House Energy and Commerce Committee, which includes Medicaid. About 1.2 million Minnesotans are on Medicaid, and if Minnesota wants to ensure all these people keep their health care, we would be on the hook to fill in any gaps that federal funds don't cover. This means lawmakers would need to make significant cuts to coverage or elsewhere in the budget — or increase taxes. Walz said Thursday that the state will need to make tough decisions to rein in rising spending. In January, Walz proposed a budget that included slowing spending on disability services and proposed changes to the sales tax that would shift the tax burden on wealthier Minnesotans, while generating more revenue for the state. But Walz said he would rethink his proposed budget if Congressional Republicans cut Medicaid. Thanks to what the Department of Human Services calls a 'coding error' that goes back a decade, the federal government paid $113 million in reimbursement for seven mental health facilities. The problem: They are not eligible for federal reimbursement, which means the state will have to repay the money. 'I am proud of our … staff at DHS for detecting a decade-old coding error in our billing system and taking immediate action to diagnose the problem and then fix it. In the process, we verified that all claims paid out by DHS were accurate and for legitimately provided treatment services,' said Shireen Gandhi, the acting commissioner of DHS, in a statement. Because of the 'improperly claimed payments,' as MMB calls them, however, the state is now on the hook for $113 million. State Budget Director Ahna Minge, when asked about the improper payments, said the budget forecast reflects a 'set up with the federal government to apply the right payment source to the cost,' noting that none of the payment amounts were incorrect but only from the wrong source. The next election might be 19 months away, but it's never too soon to hit the opposition. Gov. Tim Walz blamed Minnesota's grim economic outlook on one person — Trump. 'There's a storm at the federal level, and that storm is Donald Trump,' Walz said. 'That's the thing that's changed between November and today's numbers.' Minnesota was already facing a multi-billion dollar deficit in the long term, however, before Trump took office, thanks largely to increasing cost of health care and special education. Walz has floated running for president in 2028, and Minnesota going from a multi-billion dollar surplus to a multi-billion dollar deficit during his tenure wouldn't be a great talking point. Right on cue, Republicans blasted Democrats for the stark difference in where Minnesota stands now compared to two years ago, when federal COVID money and improving economic conditions led to the big surplus. 'Republicans are ready to work on a responsible and balanced budget that's going to fund our priorities. It will protect vulnerable Minnesotans, yet we're going to address the fiscal disaster that Democrats in the state of Minnesota have created,' House Speaker Lisa Demuth, R-Cold Spring, said. 'We can't take time blaming a new administration for problems that were caused over the last two years under one party.' Senate Minority Leader Mark Johnson, R-East Grand Forks, pushed back on the idea that Trump's policies are causing chaos for Minnesotans. 'Let's address (the deficit) first before we start getting into the hypotheticals of what's going on in D.C.,' Johnson said. 'The reality is that we have issues right here in the state right now.' Senate Majority Leader Erin Murphy has used a salty tongue to get her point across lately, and Thursday was no exception: 'Trump, Musk and the Republicans in Congress have got to pull their heads out of their asses and get to work for the people of this country,' said Murphy, DFL-St. Paul. 'The Democrats here will continue to stand up for all Minnesotans, and we will pass a balanced, equitable budget that does everything we can to protect Minnesotans from Trump's chaos.'
CBS News
06-03-2025
- Business
- CBS News
Minnesota budget surplus falls by $160M in latest forecast, looming deficit grows to $6B
Minnesota's surplus for the next two-year budget has plummeted by $160 million, according to the latest forecast, which cites federal policy changes and inflation as reasons for the decline. In December, officials forecast a $616 million surplus for fiscal years 2026 and 2027. On Thursday, the projected balance is now $456 million, according to Minnesota Management and Budget, a shrinkage of nearly 26%. "Minnesota's budget outlook has been adjusted downward amid significant near-term economic and fiscal uncertainty," the office said. If the state continues to outspend its revenue growth, there will be a deficit of nearly $6 billion in future years, officials said — $852 million worse than the previous forecast. In November, officials warned lawmakers should consider that possibility when crafting the next two-year budget. "Shifting policies at the federal level introduce significant uncertainty to the projections," Minnesota Management and Budget said. Officials were expected to release the full budget forecast and more information at noon on Thursday. State leaders are expected to speak shortly after that. After the December forecast, state Republicans were quick to blame Democrats for overspending when they controlled the House, Senate and governor's office. DFL leaders in response said the state had a robust rainy day fund and vowed to balance the budget through bipartisan work.
Yahoo
28-01-2025
- Politics
- Yahoo
Walz: Trump's federal funding freeze threatens $1.9B-a-month for MN schools, healthcare, police
The unilateral decision by President Donald Trump to temporarily freeze federal funding already approved by Congress threatens up to $1.9 billion in monthly funding in Minnesota, Gov. Tim Walz said. The federal Office of Management and Budget issued a two-page memo late Monday announcing a temporary pause on federal grants and loans. On Tuesday, there were widespread reports that the federal portal that distributes Medicaid funding to states had stopped working, with The New York Times is also reporting there have been interruptions in funding for Head Start early childhood education providers. Minnesota Management and Budget said it attempted to draw down $400 million in federal Medicaid funding on Tuesday morning but was unable to do so, however it was successful in obtaining the money on Tuesday afternoon. Bring Me The News also understands that at least two cities in Minnesota – West St. Paul and Newport – have been informed that federal funding for its police departments distributed by the Department of Justice's COPS program have been put on hold as part of the freeze. As well as the two-page memo, the federal Office of Management and Budget also sending a document to federal agencies asking for more details on 2,600 programs – including those providing free school meals to low-income students and reintegration programs for homeless veterans – to see whether they comply with the Trump Administration's directives to scrap anything that promotes diversity, equity and inclusion (DEI) or "gender ideology." With confusion rife over the programs to which the freeze applies, the White House clarified on Tuesday afternoon that it should not impact anyone receiving "individual assistance" from the federal government, but instead was targeting programs aimed at reducing greenhouse gas emissions and promoting diversity initiatives or "transgenderism and wokeness." With the funding halted by Trump having already been approved and earmarked by Congress, the orders are expected to be quickly challenged as unconstitutional in the courts. On Tuesday, Gov. Tim Walz said an ongoing funding freeze would put an almost $2 billion hole in the state's monthly budget, claiming Trump "just shut off funding for law enforcement, farmers, schools, veterans, and health care." Minnesota Management and Budget said that while there remains much unknown due to limited information from the federal government, there around 1,000 state programs in Minnesota potentially affected by the funding freeze, and many thousands of employees in the state. "Minnesota will do what we can to keep the lights on, but we cannot fill the nearly $2 billion hole this will put in the state budget's each month. I do not believe this decision was constitutional and we will work diligently to reverse it, but we are preparing for every eventual outcome to help Minnesotans weather this storm," he said. "President Trump is leaving states out in the cold without any guidance or explanation. Minnesota needs answers. We will see President Trump in court," he added. "This is not constitutional. This is not governance, and this is going to hurt people in every state," Lt. Gov Peggy Flanagan said. "I want to acknowledge this is scary ... but in Minnesota we are here for you. We don't have all the answers yet and we certainly need to call in our lawyers, but we will get through this." Flanagan went on to describe the freeze as an "illegal power grab" by Trump designed to hold taxpayer dollars in Washington D.C. rather than sending it back to the states. "We're not going to sit around and take it, we're going to stand up for the people of this country," Minnesota Attorney General Keith Ellison added during a Tuesday press conference. But there is support for Trump's move from 8th District Republican Rep. Pete Stauber, who posted: "We are 36 trillion dollars in debt, largely because of wasteful spending in Washington on things we don't want and can't afford. "Rest assured, this pause on federal funding will be lifted on worthy projects, many of which I fought for in the Northland. This is good governance and what the American people voted for!"
