ST. PAUL (AP) - Minnesota's budget debate kicks into a higher gear on Thursday when state finance officials set the parameters for a process that must conclude by mid-May.

A comprehensive look at state tax and spending patterns will identify the expected shortfall that must be patched when lawmakers set the next two-year budget. Virtually no one at the Capitol expects the forecast to project a long-term surplus.

Gov. Mark Dayton assembled his two-year budget based on a prior forecast reflecting a $1.1 billion deficit.

If the deficit shrinks, Dayton could rejigger the controversial tax-hike proposal that is central to his budget fix. If the shortage grows, it will increase pressure on lawmakers to cut spending or raise taxes even higher.