Yes, Rachel Maddow, Wisconsin really does have a budget deficit

The confusion, it appears, stems from a section in Lang’s memo that — read on its own — does project a $121 million surplus in the state’s general fund as of June 30, 2011.

But the remainder of the routine memo — consider it the fine print — outlines $258 million in unpaid bills or expected shortfalls in programs such as Medicaid services for the needy ($174 million alone), the public defender’s office and corrections. Additionally, the state owes Minnesota $58.7 million under a discontinued tax reciprocity deal.

The result, by our math and Lang’s, is the $137 million shortfall.

It would be closer to the $340 million figure if the figure included the $200 million owed to the state’s patient compensation fund, a debt courts have declared resulted from an illegal raid on the fund under former Gov. Jim Doyle.