Minnesota lawmakers finish $72 billion budget

ST. PAUL — Minnesota lawmakers raced against the clock Monday, May 22, to get their final bills passed before the adjournment of the 2023 legislative session.

All the bills forming the $72 billion two-year budget backed by Democratic-Farmer-Labor lawmakers and Gov. Tim Walz have passed in the Senate and House, as well as a $2.6 billion infrastructure investment bill — the first in nearly two years.

It's been a whirlwind of legislation at the capitol since Jan. 3, as DFLers in control of state government for the first time in nearly a decade scored many major victories.

Bills passed this session that have either become law or are on their way include legal adult-use recreational marijuana, new protections for abortion rights, gun control laws, universal free school lunch and the creation of a paid family and medical leave program.

Walz on Sunday called 2023 the “most successful session of our lifetimes.” DFLers won control of state government in November, and with no Republican Senate majority in the way have moved swiftly to enact many of their priorities.

Speaking to reporters Monday, House Speaker Melissa Hortman, DFL-Brooklyn Park, noted not just the speed and accomplishments of the DFL this session, but also that lawmakers had finished nearly all of their business with time to spare before the midnight deadline.

"I've served for 20 years, about half of it in the minority, about half of it in the majority. And there were too many sessions where bills were thrown on our desk at like 11:50, with hundreds of pages that we had never seen before," she said. "We had no idea how could we decide whether to vote for them or against and we didn't know what was in them."

House Minority Leader Lisa Demuth, R-Cold Spring, told reporters Monday that this session will be consequential for Minnesotans as they'll see their taxes go up.

While DFLers delivered billions in tax relief to many Minnesotans through child tax credits and direct rebate checks, they also introduced billions in new fees and taxes. Demuth called the 2023 session "very quick and very disappointing" and asked why DFLers didn't do more to return the historic budget surplus.

"With a $17.5 billion surplus, we delivered none of that back to Minnesota," she said. "None, it's nothing for the Minnesota taxpayers."

Minnesota's last two-year budget was $52 billion, and the upcoming budget represents a 38% expansion. But Hortman pointed out that much of that spending is one-time and will not all carry into the following years.

One of the biggest final-day items included the health and human services bill, which sets a $6.2 billion budget for the next two years. It passed the Senate 34-32 and the House 69-64 on Monday afternoon.

The more-than 800-page bill contains many provisions, including the creation of a health care affordability board and allowing people in the U.S. illegally to enroll in MinnesotaCare health insurance. It also eliminates remaining abortion restrictions in state law that were struck down by a judge last year, including a 24-hour wait period.

A last-minute change by lawmakers removed language requiring hospitals to establish boards that would create boards to determine nurse staffing levels. DFL lawmakers backed off including the "The Keeping Nurses At the Bedside Act," after Mayo Clinic said it would reconsider billions in new Minnesota investments if it passed. Mayo got an exemption which some DFL lawmakers and Gov. Tim Walz supported.

Still, many other hospitals said they also opposed the change, and the staffing requirement didn't make it into the final health bill. Instead, lawmakers took up the "Nurse and Patient Safety Act," which would provide loan forgiveness to nurses and create new workplace violence protections. It's a compromise not as strong as the staffing requirement that used to be in the health bill.

"Corporate power in health care is real and we touched it and it pushed back," said Sen. Erin Murphy, DFL-St. Paul.

A $2.6 billion capital investment package DFLers and Republican lawmakers announced an agreement on Saturday is on its way to the governor.

In exchange for support of the $1.5 billion of borrowing in that proposal, DFLers agreed to back $300 million in aid to struggling Minnesota nursing homes. Both chambers approved that bill unanimously late Monday.

It’s been over two years since the Legislature last passed a capital investment bill, and communities across the state — particularly in Greater Minnesota — say funding for local projects can't wait any longer.

The money funds projects like water treatment plants and roadwork across the state. Small local governments often rely on borrowing, or bonding bills, to build essential infrastructure they’d otherwise struggle to afford.

There are two bills in the revived capital investment proposal lawmakers passed Monday night: one has $1.5 billion in borrowing, the part that needed Republican votes. The cash part is about $1.1 billion. It's a revival of an infrastructure package that passed the House earlier this session, but the borrowing part fell short in the Senate.

A big change is the level of cash. The original cash portion of the bill called for $400 million in general fund money, but now it's more than a billion. Projects contained in the original bill will remain intact, lawmakers said.

In the $400 million bill passed earlier this year, about $90 million in bonds and $185 million in cash for local projects was split between Democrats and Republicans.

Borrowing bills require three-fifths support from the Senate and House to pass. And even though Democrats have majorities in both chambers, they needed GOP votes to get a supermajority on a bill.

House Republicans joined DFLers in approving the $1.5 billion bonding bill earlier this year, but Senate Republicans blocked it, demanding more action on tax cuts as the state had a historic surplus.

But soon it became clear that DFLers were not interested in entertaining Republican demands for more tax relief. After months of offers from Republicans — and just days before the end of session — the deal came on nursing homes, something GOP lawmakers had been pushing for in addition to the taxes.

Another item of business Monday included House consideration of a bill to put an equal rights constitutional amendment on the ballot in 2024. In the next statewide election, voters would be asked whether the Minnesota Constitution should include an amendment to reinforce equality under the law. It passed in the Senate but only needs approval from the House to be put to voters. The House adjourned without passing it, so it'll have to wait until the next session.

There's a chance lawmakers may have to reconvene this summer to address details of a proposed merger between South Dakota-based Sanford Health and Twin Cities-based Fairview Health Services. Fairview holds assets tied to the University of Minnesota Medical School, and many have argued the state should retain them when Sanford takes control of Fairview in the merger.

Follow Alex Derosier on Twitter @xanderosier or email aderosier@forumcomm.com .