Minnesota budget forecast shows near-term surplus, looming deficit shrinking to $3 billion

ST. PAUL — Minnesota's bi-annual budget forecast on Thursday, Dec. 4, shows the state's looming budget deficit decreasing by roughly $3 billion.

Initial numbers released by Minnesota Management and Budget (MMB) on Thursday morning show a projected $6 billion budget deficit for 2028, decreasing to $2.96 billion for 2028-29. In the near term, projections show the state working with a $2.57 billion surplus for 2026-27. MMB officials and lawmakers are set to present more details on what’s contributing to the estimates at noon Thursday.

The state’s budget reserve, otherwise known as the “Rainy Day Fund,” is at an all-time high of $3.7 billion.

In the 2025 session, bipartisan negotiations with lawmakers and Gov. Tim Walz took aim at shaving down the $6 billion budget deficit by 45% with i