A look at how some states are considering using their projected budget surpluses in 2014

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Many states are projecting sizeable budget surpluses this year as a result of stronger-than-expected tax revenues. Governors and lawmakers are putting forth a variety of proposals for the extra money, including cutting taxes, increasing spending and fortifying savings accounts. Here’s a look at the situation in some states.

CALIFORNIA

A surging technology sector and temporary tax increases approved during the economic downturn have combined to produce a projected $3.2 billion surplus that could grow to $10 billion within three years. Democratic Gov. Jerry Brown has proposed spending increases but also wants to use the surplus to pay down debts and replenish the state’s reserve fund. Some Democratic legislative leaders want to spend more on welfare programs and launch a new preschool initiative.

MICHIGAN

The budget director for Republican Gov. Rick Snyder is predicting that a tax cut or rebate is “inevitable” in light of a roughly $1 billion budget surplus. GOP legislative leaders want to pursue a personal income tax cut. Snyder has said he will propose a tax-relief plan in the coming weeks. But he said he first wants to expand an early childhood education program and then see how much is available for tax cuts or the state’s rainy day fund.

MINNESOTA

Having raised taxes by $2.1 billion last year, Minnesota’s Democratic legislative majorities and Gov. Mark Dayton are now deciding how to divvy up an $825 million surplus. Dayton wants to devote half of it to repealing some new sales taxes on business transactions and to provide a middle-class tax cut. Some lawmakers are also talking about using the money to accelerate road projects or saving it for future needs.

MISSOURI

Republicans who control the Legislature have made an income tax cut a priority for 2014, after failing last year to override Democratic Gov. Jay Nixon’s veto of a tax-cut plan. A variety of proposals would cut taxes for businesses and individuals. Republican House Speaker Tim Jones says the lost revenues could be partially offset by a surplus that he estimates at $700 million. Nixon is expected to propose a significant funding boost for public schools during his State of the State address next week.

NEW YORK

Democratic Gov. Andrew Cuomo is citing projections of a $2 billion surplus to propose broad-based tax relief, including reducing the corporate income tax rate and eliminating it altogether for upstate manufacturers. Cuomo is also proposing tax credits for lower-income homeowners and renters and a cut in the estate tax. Democratic Assembly Speaker Sheldon Silver has pledged to continue seeking more education funding.

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