Tricounty News

State facing a budget deficit

Rep. Hosch says job creation remains top priority

Minnesota is still experien-cing high unemployment because of the severe national recession and it has resulted in an additional projected budget deficit of $1.2 billion budget deficit through 2011 and a $5.4 billion deficit through 2013 according to the budget forecast released Wednesday, Dec. 2, by the Minnesota Department of Finance. The additional $1.2 billion gap brings the total budget deficit during the current biennium to $7.6 billion, the largest in state history. State Rep. Larry Hosch said the budget challenge reiterates the Legislature's top priority for the 2010 session - create jobs to grow Minnesota's economy.

"Our budget deficits will not go away until we address the jobs deficit in this state," said Hosch. "There is no silver bullet or single answer, so we must move forward with a broad range of ideas and measures that can spark our economy and create new jobs."

According to the Minnesota Department of Finance, 70 percent of the projected $1.2 billion budget deficit is a result of lower than expected income tax receipts, a trend that has been seen in the past several economic forecasts. Hosch said that lack of jobs is the chief driver of these deficits.

"We keep hearing from economic experts that our budget deficits are a result of a revenue shortage," said Hosch. "The number one reason for that shortage is too many Minnesotans are out of work."

This is the seventh budget deficit in Governor Pawlenty's eight years in office. Rep. Hosch said it is evidence that short-term fixes and a partisan-budgeting approach will not solve our budget problem.

"If we ignore our budget troubles, or push them out into the future, things will only get worse," said Hosch. "We have to work collaboratively on a long-term approach to solve our serious budget challenges, that's what it will take for sustainable solution."

State Economist Tom Stinson has pointed to education as the best tool to promote long term economic growth. That is because the evidence shows that Minnesota has traditionally been a national economic leader because of our world-class educated workforce. Hosch said it would be critical to maintain Minnesota's excellence in education at every level in order to lay the foundation for a healthy economic future.

"The next generation of workers who will fuel our economy is sitting in classrooms across Minnesota, and its critical we provide them the skills they will need to compete in the competitive global economy," said Hosch. "From an economic standpoint, when Minnesota students succeed, Minnesota succeeds."

Governor Pawlenty's suggested he would use his unallotment authority to make more cuts to local cities and counties before the Legislative Session begins in February. Hosch said another round of deep cuts to local governments would increase property taxes on families still struggling in this recession and urged the governor to consider input from the public before making a unilateral decision that would increase property taxes.

"Increasing property taxes on Minnesota homeowners to balance the budget deficit is unwise and it would be unfair for the governor to take that action without hearing from the public," said Hosch. "We have some very difficult decisions ahead, but we will do a better job making those decisions if we hear from the public and work together during the session."

With the 2010 Legislative Session a few months away, Hosch urged his constituents to contact him with questions and input about the budget and upcoming session. The 2010 Legislative Session begins Feb. 4, 2010.

Rep. Hosch can be reached at (651) 296-4373, by e-mail at This email address is being protected from spambots. You need JavaScript enabled to view it. , or by mail at 565 State Office Building, St. Paul, MN 55155.