With CHIP money restored, is Minnesota deficit gone?

Minnesota will regain a critical federal allowance for children's health programs under a short-term budget agreement signed into law Monday, mostly patching what had become a hole in the state budget.

Federal money had run out for the Children's Health Insurance Program, known as CHIP. Minnesota was forced to divert some state tax dollars to the program to keep 125,000 children and others in low income families connected with care.

Minnesota Management and Budget Commissioner Myron Frans said Tuesday he's still awaiting some details on changes lawmakers made to CHIP. But he said the federal budget agreement offers needed certainty.

"The reauthorzation of the Children's Health Insurance Program will provide the assurance for the next six years that program will be funded," he said.

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Minnesota Human Services Commissioner Emily Piper, whose agency administers the program, said it's a relief.

"Health care for Minnesotans has faced a lot of uncertainty over the past year and the stability that this brings, even if overdue, helps families with kids and new and expecting moms across Minnesota to receive access to the health care when they need it," she said.

The lapsed federal CHIP payments had been a big factor in a state budget forecast in December that projected a slight deficit. Those hung-up grants had accounted for $178 million of a $188 million projected deficit. A new economic report scheduled for late February will address whether the deficit has been patched up.

The prior forecast also failed to account for a major federal tax overhaul, which hadn't passed into law when the state budget estimates were made.

Does that mean December's deficit will become a February forecast surplus? It's too soon to assume that, Frans said.

"There are still too many variables to get an indication of where we will be," he said.