State officials announced a $323 million surplus Wednesday, but the money was automatically committed to paying the state's debt to public schools and replenishing budget reserves, the Star Tribune said.
The budget forecast was the second positive forecast in as many years. State Economist Tom Stinson and Minnesota Management and Budget Commissioner Jim Schowalter said it showed the state's finances may be in a holding pattern.
Stinson and Schowalter said that the state's economy has picked up and Minnesota's December unemployment was 2.8 percentage points lower than the national average -- 5.7 percent in Minnesota compared to 8.5 percent nationally, the Tribune said.
Minnesota has significant debts to repay in the coming budget cycles, so the forecast is unlikely to change the dynamic at the Capitol this year, the article said.
The next budget forecast predicts a $1.1 billion shortfall for 2014-15, the Pioneer Press said.
State leaders announced in November an improved economy created a surplus of nearly $900 million, money that was used to begin refilling reserves, the Tribune said. The state will now begin paying down $2.7 billion in the school shift -- money that was essentially borrowed from public education to bring the state budget into balance.
Stinson said that consumer confidence is rising.
"Generally things are looking good," he said "The economy appears to be strengthening."
Lower spending estimates account for two-thirds of the change, with revenue updates accounting for the other one-third, the Press said. State revenue are stable and Minnesota labor numbers are outperforming other states.
"We're certainly in a much stronger place than we were a year ago," said Schowalter.