Minnesota House and Senate Release Committee Budget Targets

March 31, 2025

The announcement is the first step toward the passage of a two-year state budget and sets priorities for committee jurisdictions.

Legislative leaders in the House and Senate announced their budget targets for the next state budget cycle. The targets outline how much general fund money committees can spend or, in some cases, how much must be cut from its budget area. The targets follow Minnesota Management and Budget’s February state budget and economic forecast, which projected a $456 million surplus for 2026-2027 and a nearly $6 billion deficit in 2028-2029.

The Senate’s budget targets propose reducing state spending by $754 million in the upcoming two-year budget and a reduction of $1.7 billion in future years. The House proposed a spending reduction of $1.2 billion for the upcoming budget cycle and a reduction of $2.6 billion in future years.

A notable element of the Senate’s tax target would require the Senate Taxes Committee to raise revenue through tax increases or reduce funding for programs like local government aid (LGA). While no bills to reduce LGA have been heard this year, legislators have indicated that all options remain under consideration. The House tax target would also require the House Taxes Committee to raise revenue or reduce funding, but not near the level outlined in the Senate target.

What’s next?

With under two weeks remaining before the third committee deadline, finance committees will spend that time compiling their major budget bills for passage to the Senate Finance Committee and House Ways and Means Committee.

After both chambers pass their budget bills, conference committees will need to reconcile the differences, with input from Gov. Walz’s administration, before they can be passed into law. The constitutional deadline for the legislative session is May 19, and a budget must be passed by June 30 to avoid a state government shutdown.

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