Minnesota lawmakers will likely have $1.65 billion in extra funds to work with in the upcoming years.

The state put out its budget forecast Tuesday morning, projecting a surplus of $1.65 billion for lawmakers to compete over when planning the 2018-19 state budget. This figure is slightly higher than the $1.4 billion forecasters projected back in December. It includes a projected $743 million that hasn't been spent from the 2016-17 budget cycle, which ends in June.

Despite an improved economic outlook for Minnesota into the 2020-21 biennium, the Department of Minnesota Management and Budget says "significant risk" remains because of "federal policy unknowns."

You can read all the nitty gritty details of the budget forecast here.

What’s the budget forecast for?

Minnesota’s Legislature will use this updated forecast to determine what it can use the money on over the next two years, beginning in July. Lawmakers – and Gov. Mark Dayton – must approve a budget by June 30 to avoid a government shutdown.

Here's a look at what the budget could look like:

The Democrat Dayton released his $45.8 billion budget plan last month, which includes spending money on early childhood education, expanding the state's MinnesotaCare public health program, and technology upgrades. He'll have to update his budget to the new $1.65 billion forecast, though.

Democrats on Tuesday urged that it's not the time to shy away from making investments.

“With uncertainty at the federal level around funding, now is not the time to step back from the investments and progress we've made in recent years in Minnesota. Our state budget continues to see a surplus, giving policymakers the space to address immediate challenges, while building the opportunities of our future," Rep. Erin Murphy, a Democrat from St. Paul, said in a statement Tuesday. 

Republicans, who have the majority in both the state House and Senate, haven't released a budget plan yet, but they have commented on Dayton's plan and said they want to use the money to cut taxes and spending. House Taxes Committee Chair Rep. Greg Davids, a Republican from Preston, told MPR News that lawmakers have proposed about $6-$7 billion in tax relief already.

House Speaker Kurt Daudt, a Republican from Crown, said Tuesday Republicans will pass "significant tax relief" to give money back to Minnesotans, with House Majority Leader Joyce Peppin, R-Rogers, saying committee chairs will begin working on a budget in the coming weeks.