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flag Minnesota forecasts a $3.7 billion surplus for 2026-27, erasing a projected deficit, but long-term fiscal challenges remain.

flag Minnesota projects a $3.7 billion budget surplus for 2026-27, $1.3 billion higher than earlier estimates, due to stronger-than-expected revenue and a better economic outlook. flag The state now forecasts a $377 million general fund balance by 2028-29, eliminating a prior projected $3 billion deficit. flag Officials warn of ongoing risks, including federal funding uncertainties, potential Medicaid payment pauses, shifting immigration and tariff policies, and incomplete data from recent federal shutdowns. flag Despite the improved short-term outlook, long-term fiscal challenges persist, with spending outpacing revenue growth. flag The findings will guide lawmakers as they consider a bonding bill and priorities like school safety, infrastructure, and government reform.

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