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Ever since state finance officials revealed the budget forecast, elected officials have been publicly politicking over what to do in light of the the expected $7.7 billion surplus.

Gov. Tim Walz and Lt. Gov Peggy Flanagan laid out a host of economic proposals Thursday centered around that question — including sending $700 million worth of checks to millions of Minnesota households.

The direct payments, dubbed "Walz Checks" by the governor's office, would be sent out to an estimated 2.7 million households, according to a news release. Single tax filers making up to $164,400 would get $175. A married couple, filing jointly and earning no more than $273,470, would get $350.

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The plan would ultimately cost about $700 million.

The administration also proposed sending $1 billion in direct payments specifically to frontline workers. Together, a frontline worker with children would get nearly $2,000 total through various pieces of the governor's proposals.

“This plan builds our economy by putting people — our strongest asset — at the center of the blueprint," said Walz.. "Right now, we have a remarkable opportunity to give money back to middle class Minnesotans, working families, and small businesses."

The "Walz Checks" were just one of a handful of proposals detailed by Walz and Flanagan. They also suggested:

  • Spending $2.73 billion to cover up a much-debated gap in the state's Unemployment Insurance Trust Fund
  • Tax cuts for families (such as middle-class families who need help paying for child care costs) and small businesses
  • $170 million for getting more Minnesotans broadband access — it's currently at 93% of residents
  • $17 million over the next two fiscal year periods for the Angel Tax Credit, to help jumpstart early-stage businesses
  • $19 million to help drought-impacted farmers, as well as meat processors

“During the COVID-19 pandemic, we have seen economic inequities exposed and exacerbated — for frontline workers, for young people, for immigrants and BIPOC communities, and for small, family-owned businesses," Flanagan said. "Our plan to expand economic opportunity will help ensure we are meeting the needs of all Minnesotans in a 21st century economy."

House Minority Leader Kurt Daudt (R-Crown), said in a statement there is bipartisan support for repaying the unemployment insurance trust fund.

But Deputy House Minority Leader Rep. Anne Neu Brindley (R-North Branch) called for "ongoing tax relief," describing the direct payments as "gimmicky checks designed to boost approval ratings." (Senate Majority Leader Jeremy Miller, a Republican from Winona, used the same "gimmick" language.")

"Sending just a fraction of the surplus back to Minnesotans is unacceptable, especially with inflation at record levels," she said.

The Commissioner's Office of Minnesota Management and Budget, in issuing the forecast in December, warned there is  "significant risk" with the projection due to the pandemic and "economic uncertainty." 

If the assumptions made in the newest forecast don't come true, then "the economic outcome will differ" from the $7.7 billion predicted surplus, it warned.

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