Dear Neighbor,
The House majority this week finished bringing its parade of omnibus bills to the floor for initial approval. Each of these bills contain major flaws, but the good news is they stand zero chance of becoming enacted this year without drastic changes.
For example, the tax bill House Democrats approved this week is part of the majority’s push to spend $21 for every $1 in tax cuts at a time the state has a massive surplus. We’ll get into more of that another time, but the surplus needs to focus on permanent, meaningful tax relief, not growing government.
On another note, legislation to repay Minnesota’s unemployment insurance trust fund deficit and reverse tax hikes employers in the state faced despite a $10 billion surplus has been enacted into law.
The bill (S.F. 2677) provides $2.7 billion to fully repay the trust fund which was depleted with more people out of work during the pandemic.
It is good to see the unnecessary UI tax increase is resolved after blatant partisan gamesmanship by House Democrats caused this to drag out for months on end. The delays they created led to a great deal of needless uncertainty and added financial stress for employers in our state. This was the last thing people needed when they are trying to recover from restrictions the governor placed on them the last couple of years and already are dealing with higher prices in the Biden-Walz economy.
Senate Republicans approved a clean bill to rectify this issue in February, with broad, bipartisan support. House Democrats delayed action until late April, when they added more than $1 billion in other funding to the bill. This change complicated matters and delayed final approval, costing state taxpayers $50,000 in interest for every day the legislation remained unfinished.
Final language includes $500 million in payments to frontline workers – approximately $750 per person – and $190 million is provided to Minnesota Management & Budget for continued COVID-19 expenses. Another measure allows just one legislative body to reject an expenditure instead of the current requirement for both bodies to object.
Approval of this bill replenishes the unemployment insurance trust fund, uses the state’s remaining federal American Rescue Plan funding and halts automatic payroll tax increases that kick in by default when the trust fund dips beneath required levels. The bill was widely supported, with a 124-5 House vote and near-unanimous passage in the Senate before the governor enacted it.
Click here for details on the changes in unemployment insurance law, and you also can visit www.frontlinepay.mn.gov for information on frontline worker pay eligibility and more.
-Steve