On December 1, advocates got an unexpected surprise when Minnesota's November 2011 forecast revealed an $876 million surplus for the current biennium. What does this collective good news for Minnesota mean for housing?
By state law, surplus funds will first be used to recover what we've spent from Minnesota's rainy day funds; $255 million will go into the cash flow account and $621 million into the budget reserve. This surplus would almost fully restore the state's budget reserve. If there had been more budget surplus, it would then be used to start paying back what we've borrowed from school payment shifts. So this surplus doesn't mean there's additional money for restoring cuts to homeless and housing programs. In fact, there's still a projected $1.3 billion shortfall for the next budget cycle of FY 2014-15.
So why are we cautiously optimistic? While we're not out of the woods, painful cuts to housing and homelessness programs are less of an immediate concern this budget cycle. It also means that the HousingJobs Campaign, spearheaded by MHP and our friends at Metropolitan Consortium of Community Developers (MCCD), stands a better chance of seeing legislation that's good for housing passed this coming session. Top HousingJobs policy goals include bonding for housing and passing a new state housing tax credit.
Look for more details to come as we approach Minnesota's 2012 legislative session, which begins January 24.
One final note: housing was left out of the final bonding bill last year and many state legislators are now motivated to further rein in state spending. We have our work cut out for us, but see a lot of opportunity for moving bonding for housing this session.