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Sailer says state shortfall emphasizes need to grow jobs and budget for the long term

The Minnesota Department of Finance released its updated state budget

forecast today showing that the state faces a $1.2 billion deficit

through mid-2011, and a $5.4 billion deficit in the following two-year

budget cycle for 2012-13. The bleak numbers reflect lower than

projected revenues that state economists attribute to the severe

national recession and high unemployment numbers.

State Representative Brita Sailer (DFL-Park Rapids) said the numbers

released today underscore the need to return to a long-range approach to

state budgeting in order to return the state to fiscal stability.

"Despite what some would have us believe, you can't cut your way to

prosperity," said Rep. Sailer. "Until we find a way to honestly and

responsibly address our budget challenges, we'll continue to see

perpetual deficits that undermine our ability to grow our economy and

create jobs."

According to the Minnesota Department of Finance, 70% of the projected

$1.2 billion budget deficit is a result of lower than expected income

tax receipts, a trend that has been seen in the past several economic

forecasts. Sailer said that lack of jobs is the chief driver of these


"Economic experts keep telling us that our budget deficits are the

result a revenue shortage," said Sailer. "Not only are thousands of

Minnesotans out of work, but many of those still working are making

less. Clearly, the number one reason for our revenue shortage is that

too many Minnesotans are out of work."

Efforts made at the state and federal levels helped keep the current

recession from becoming a depression and have recently showed signs of

improving Minnesota's economy, said Sailer. Federal Recovery dollars

have saved or created 14,000 jobs in Minnesota since February, and state

bonding dollars spent on shovel-ready projects enacted this last

legislative session have put thousands more to work. A larger bonding

bill will be on the table this session as lawmakers work to pinpoint

projects that will quickly create jobs and spur needed economic growth.

"Our bonding bill will focus on those projects that can quickly create

new jobs and strengthen our infrastructure to help our state grow in the

future," said Sailer, noting regional bonding projects including

finishing the work on the Red Lake high school and middle school


In addition to focusing on job creation and Sailer said it will be

important for the Legislature to recognize the short and long term

budget challenges facing Minnesota and to start this session.

"There is no single solution to solve this budget crisis," said

Sailer. "Cuts alone kill jobs and leave families and businesses with

less money to spend - we must work towards a balanced solution. Our

state's economy used to perform better than the rest of the country

during good and bad economic times. But in recent years, Minnesota has

fallen to the point where we consistently rank in the bottom ten states

in employment growth. It is of prime importance for the people of our

state to work as one to reverse this trend and I have no doubt that we

can accomplish it if we put our collective minds to it."

Sailer continued, "We have to get off the budget roller-coaster of

the past few years and get serious about long term, stable state

budgeting. We have to consider every available option and we need to do

it now, because putting off the hard decisions just makes things