Red ink, gambling revenue, locked-up juveniles and smaller walleye

Today on the MPR News Update: We hear arguments for and against Gov. Dayton's tax overhaul proposal, state officials worry - again -- about how they will pay for a new Vikings stadium, some people in state custody may have been held longer than necessary, and Lake Mille Lacs area folks sound off about a plan to cut fishing there in half. But first, the latest state budget forecast is out:

LESS RED INK: The February budget forecast shows a projected budget deficit of $627 million. That's an improvement of $463 million from the November numbers, which showed a projected deficit of $1.1 billion. State lawmakers will use the forecast to shape their budget decisions this legislative session.

TAX PLAN REACTIONS: Our DFL governor's tax overhaul proposal would raise about $2 billion in new revenue by raising income taxes on top earners and by expanding the sales tax while reducing property taxes. It got its first House committee hearing last night, and drew passionate reactions.

GAMBLING REVENUE: One of the most closely watched numbers in today's state budget forecast may be the projected gambling revenue to pay for a new stadium for the Minnesota Vikings. Seeing slower-than-expected growth in revenues from electronic pulltab gambling, state finance experts cut their expectations in half in November. Now, officials think revenues will probably miss revised estimates, too. That may boost interest in alternatives at the Capitol and elsewhere.

SAME-SEX MARRIAGE: Lawmakers have launched a long-anticipated effort to legalize same-sex marriage in Minnesota. DFL state Sen. Scott Dibble and DFL state Rep. Karen Clark, both of Minneapolis, are the chief authors of the bill. If passes, the measure would remove a prohibition in current state law, and allow same-sex couples to begin marrying Aug. 1.

NO WAY OUT: Hundreds of people with mental illness remain in state-run psychiatric facilities for months or even years after they are ready to return to the community, according to a lengthy report released by the Office of the Legislative Auditor, who says the failure to discharge patients or provide community housing options may violate patients' legal rights and put the state at risk of lawsuit.

RACE AND DETENTION: The rate of children sent to juvenile detention facilities across the country for delinquent behavior has dropped off dramatically over the past decade and Minnesota is one of five states with the sharpest declines, a new report says. But behind the numbers in Minnesota and across the country is a disturbing trend: Kids of color are being locked up at a higher rate than whites.

EDUCATING INMATES: Inside Stillwater Prison, inmates are doing long, sometimes life sentences for murder, armed robbery, and other felonies. But when many of those prisoners went inside they were high school dropouts or people who hadn't had much education, or cared about school. Prison has changed that. Daily Circuit producer Maddy Mahon went inside the prison to find out what kinds of educational programs it offers.

WOUNDED KNEE: Faith White Dress was on the Pine Ridge Indian Reservation 40 years ago when about 200 members of the American Indian Movement and their supporters huddled in houses, some with guns, to protest alleged corruption within the tribal government. Two Native Americans were killed, an activist went missing and a federal agent was wounded. She says little has changed since the fatal standoff.

SMALLER WALLEYE: A town hall meeting Wednesday night on the north side of Lake Mille Lacs was packed, as Department of Natural Resources officials heard from area residents and business owners about how regulations on one of the state's most popular walleye lakes could impact the community. The name of the game is going to be "small walleye friendly."

CASINO LAWSUIT: The city of Duluth has sued the federal government as part of its long-running dispute with the Fond du Lac Ojibwe Band over revenues from its Duluth casino. The city filed suit this week against the federal National Indian Gaming Commission. Two years ago the commission ruled that the revenue sharing agreement between the band and the city of Duluth violated federal law, which requires that Indian tribes retain "sole proprietary interest" of their casinos. Starting in 1994, Duluth received about $6 million a year from the downtown casino. But in 2009 the band stopped paying.

MAYO MONEY: Mayo Clinic reports a large decline in its bottom line last year, but officials are still calling the results a solid financial performance. Clinic officials say the drop in income was by design, but is also due in part to a large payment to its pension plan. Mayo brought in a lot of money last year, nearly $8.8 billion across its system. That's 6 percent more than the year before. But the Clinic also spent more money.

MINIMUM WAGE: A bill that would raise Minnesota's minimum wage to more than $10 an hour by 2015 is moving through the Legislature. The House Labor, Workforce and Regulated Industries Committee on Thursday passed a bill to increase to the minimum wage in three steps until it hits $10.55. After that, wages would automatically rise according to inflation.

MENTAL ILLNESS GENETICS: The largest genetic study of mental illnesses to date finds five major disorders may not look much alike but they share some gene-based risks. The surprising discovery comes in the quest to unravel what causes psychiatric disorders and how to better diagnose and treat them. The disorders -- autism, attention deficit-hyperactivity disorder or ADHD, bipolar disorder, major depressive disorder and schizophrenia -- are considered distinct problems. But findings published online Wednesday suggest they're related in some way.

NORTH LOOP FOODIES: Like other foodie metropolises around the country, the ever-expanding Twin Cities dining scene is producing its fair share of hot neighborhoods filled with new bars and restaurants. The Star Tribune's Tom Horgen says, "My new favorite is this short stretch of North Washington Avenue near Target Field where a few of the best restaurants in the city are now clustered.

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