By: Jessica Lee

February’s budget forecast predicts a smaller deficit for the state’s 2014-15 biennial budget.

State finance officials announced Thursday that Minnesota’s looming $1.1 billion deficit —predicted in November — is expected to improve by $463 million.

The forecast, crafted by Minnesota Management and Budget, offers relief for the current biennium with a positive balance of $295 million.

Most of that revenue is supposed to be paid back to the state’s school districts — money owed from previous budget deals.

The remaining funds from the current budget’s positive balance are expected to go into the state’s budget reserve.

Gov. Mark Dayton is expected to change his tax plan, which was based on November’s forecast, to fit with the new predictions.

The newest forecast will be used by legislators to make their budget plans and a final budget is expected by mid-May.