Anticipating Bump In Revenue, Legislators Consider Tax Cuts, Education Spending

New revenue estimates show the state government will have $912 million more in the bank than previously projected, and already state leaders are weighing in on what to do with the money.

The nonpartisan Legislative Fiscal Bureau said a boost in tax collection will leave state coffers with a balance of close to $1 billion by June of next year.

Assembly Speaker Robin Vos said he’d like to use the money to cut property taxes, possibly using state technical colleges as the vehicle to do it.

“The property tax relief will be my highest priority, it always has been. I think Gov. (Scott) Walker and others — I’m in that camp, too — are OK with updating the tax tables to have the maximum amount of peoples’ take-home pay held by them in their own checks as opposed to an interest-free loan to state government,” Vos said. “And then, we’ll put money in the rainy day fund just as we have in the past.”

Republican Senate Majority Leader Scott Fitzgerald wasn’t ready to endorse any specific tax cut. He said some of his members wanted to save some of the surplus.

“There certainly is a group of senators that want to pay some of the future obligations — the structural deficit. They want to take care of that. And then after that, I think the dollars certainly will be moved into increased tax cuts,” Fitzgerald said. “Now, how you do that or where you put that money, I think is what we have to kind of continue to discuss.”

Assembly Democratic Minority Leader Peter Barca said the state should take a more balanced approach to dealing with the surplus.

“We look at Minnesota, we see how they’ve handled their surplus. They’ve had over a billion dollars and they’ve given targeted tax relief, but they’ve also invested in education and job training, and it’s paid dividends for them,” Barca said. “Their job numbers are far better than ours.”

Walker will outline his plans for the money during next week’s State of the State address.