Minnesota stands to gain a cool $3 billion from the federal stimulus package being completed in Washington, and possibly more once competitive grants are included.
State officials caution that the numbers are still being finalized but said Thursday the package will infuse cash into nearly every part of the state budget, with money for roads, bridges, schools, health care, local government, clean water and more.
According to White House documents, the package will create or retain up to 66,000 jobs across the state.
More than a third of the stimulus legislation is devoted to tax cuts, and Minnesotans can expect to see up to $400 individually or $800 jointly in reduced tax liabilities, in addition to tax credits for college and school-age children. Jobless benefits would go up by $100 a month and food stamp benefits would be increased 13 percent.
House Speaker Margaret Anderson Kelliher, DFL-Minaneapolis, said that while "a lot of the details are not as crisp as we would like," there appears to be more flexibility in the funds than state officials had thought.
That could be a boon as legislators try to wipe out a projected state deficit that could approach $7 billion by March.
Kelliher said the state is in line to get at least $40 million in education funds that could be applied broadly across its existing funding formula. It also will receive at least $29 million for roads and bridges, with the proviso that at least half the money goes to projects that will be shovel-ready by midsummer.
Kelliher said that any states that cannot find enough projects to use up half their money will have to return it to the feds to redistribute to other states. "Hopefully we'll be ready to use all of ours and maybe even ... to pick up more," Kelliher said.
Jim Schowalter, state budget director, said Minnesota will get at least $2 billion that can help the state's general fund and another $1 billion for items outside the general fund. In addition, he said, the state can compete for some grants related to energy and other green-job funds.
All of this could mean an overhaul of Gov. Tim Pawlenty's proposed budget. That proposal would have pared about $2 billion in state spending, cut nearly every part of government except K-12 schools and ratcheted back on health care.
But some of those changes won't be allowed under the stimulus package rules, which require states to maintain a certain level of service in areas such as health care and education.
State Management and Budget Commissioner Tom Hanson said the administration would have to change portions of the budget proposal but that there is no way yet to tell how much.
Patricia Lopez • 651-222-1288