Editorial roundup: Reserve, surplus allows a robust relief package
Minnesota’s conservative budget principles embraced by Democrats and Republicans have paid off now that we’ve all come to experience the “rainy day” of the COVID pandemic.
The state reported an expected budget surplus of $641 million for the year ending June 30, reversing an earlier prediction of a $2.4 billion shortfall. Minnesota Management and Budget still estimates a $1.27 billion shortfall for the 2022 and 2023 years, but that is also much lower than an earlier prediction of a $4.7 billion shortfall.
Part of the turnaround is due to Minnesotans spending on goods during the pandemic in unexpected ways. Sales tax revenues were higher due in part to federal unemployment assistance and one time payments of $1,200. On the spending side, education and health care expenses were down for the state as public school enrollment declined and people didn’t use state-funded health care as much, putting off going to the doctor due to the pandemic.
But Minnesota also planned for these economic shocks by having a healthy reserve fund of about $2.5 billion.
Republican legislative leaders and Gov. Tim Walz are on a path to provide a bipartisan COVID relief package, with the governor noting the surplus allows them to do that and do it quickly. He estimated the relief package would cost anywhere from $300 million to $600 million.
These pages have previously urged a robust package to assist small businesses like bars, restaurants, salons and other retail businesses. Some form of sales tax relief and more flexibility like letting bars sell mixed drinks for takeout seems reasonable.
We hope Democrats and Republicans can come to a reasonable compromise on a COVID relief package. This is no time to try to make political points or statements about one party’s apparent economic philosophy.
It would be very disappointing to hear either side issue statements or talking point press releases, some of which have already creeped into media mailboxes. Nobody’s talking about raising taxes. Nobody’s talking about who hurts the middle class most. Let’s keep it that way.
COVID relief should not be a partisan issue.
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