Warning Signs:
•The steepest decline in housing values in 20 years
•Personal income growth down
•Unemployment up
•Gasoline prices remain near $3 a gallon
Big shifts in prior forecasts:
•November 1997: Up $1.3 billion
•November 1999: Up $1.6 billion
•November 2001: Down $2.2 billion
•November 2006: Up $1 billion
How the 2004-2005 budget shortfall was balanced:
• Spending cuts: $2 billion
• Reserves and tobacco funds: $1.2 billion
• New and one-time revenues: $931 million
• Accounting shifts: $503 million
Sources: State economist; Minnesota Dept. of Finance