Concerning trends in Minnesota’s state budget could soon spell trouble for taxpayers and the broader economy. Here are five critical details every Minnesotan needs to know.
- Minnesota has spent more than it collects in revenue each year since 2024.
- Inflation-adjusted per capita spending in the 2026 fiscal year ($5,962) was the second-highest in state history, surpassed only by 2024. Spending is projected to exceed pre-2024 levels each year through 2029.
- Spending on Health and Human Services (HHS) — which primarily comprises several means-tested programs, such as Medicaid — exceeded E-12 education for the first time in 2026.
The budget share allocated to HHS has grown by 60 percent since 2000. As a result, state spending on public services outside of E-12 education and HHS (such as public safety) has shrunk to less than 30 percent of the state budget.
- Adjusted for inflation, Minnesota spent over $2 billion more on Medicaid in the 2026 fiscal year than in 2023. Medicaid is the primary driver of budget growth and has accounted for nearly a third of all new spending since 2023.
- In 2024, Minnesota ranked 12th-highest, making it one of the top spending states nationally.
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