Minnesota State's Budget Volatility
Jay Kiedrowski: Let's Stop the State's Fiscal Roller Coaster
In this editorial Jay writes about the volatility of state finance in Minnesota. Last November there was an announced forecast surplus of $2.2 billion by June 2009; no the number has turned to a forecast deficit of $374 million. Due to Minnesota's volatile revenue structure -- more to know about from my perspective -- the state budget condition can be big disappointments during economic slowdowns and recessions, or happy surprises during economic recoveries and accelerations. As high level of uncertainty raises the difficulty of budgeting and financial management, there is a bipartisan consensus to reduce revenue volatility, in which taxes/expenditure do not have to raised to cut.