Hello from the State Capitol,
As expected, House Democrats led by Speaker Hortman and Majority Leader Winkler this week refused to debate a bill that would have prevented tax increases of 15% or more from being leveled on all Minnesota job providers.
You’ll recall Minnesota needs to replenish its Unemployment Insurance (UI) Trust Fund by more than $1 billion. Available state surplus funds could be used for this purpose, as could federal COVID relief funding that totals more than $1 billion. If neither of these pots of money are utilized, the default repayment is tax increases on local business owners by 15% or more.
Governor Walz’s employment commissioner previously stated that legislation needed to be approved by Tuesday in order to avoid “major problems” for the State of Minnesota.
On Monday, for the second time, House Republicans tried to move legislation that would have prevented these tax increases. But House Democrats again blocked the bill from being debated. Speaker Hortman also walked out of negotiations regarding this unnecessary tax increase.
So, if you’re a local business owner, you should begin preparing to pay significantly more to state government. I can’t sugarcoat this: House Democrats are playing a political game with your livelihoods, and their inaction is the sole reason you are being forced into this mess.
AUDIT FINDS TROUBLING NEWS ON UNEMPLOYMENT INSURANCE FRAUD
The Unemployment Insurance program also received more scrutiny this week, although in this instance it was based on fraud.
Minnesota’s legislative auditor found that during Fiscal Year 2021, the UI Division received nearly 24,000 fraud allegation reports from the public, most alleging an imposter applied for benefits using a stolen identity. In June 2021 alone, the division stopped payments on about 2,500 suspicious accounts—more than one-third of all new accounts opened that month. Yet over the past several years, only a couple of dozen fraud cases have ever been referred to law enforcement.
This is not only troublesome, but problematic. DEED does not need to report information about UI program fraud to the Minnesota Legislature, so this is basically the first we’re hearing about this. It’s clear lawmakers need to address not only the fraud itself, but the reporting of it. If you’ve committed fraud, you’ve committed a crime and law enforcement should be involved. Minnesotans have the expectation that their tax dollars are being used wisely and that criminals receive punishments for their actions. More legislative oversight of this program would likely ensure both of these necessary expectations.
SOCIAL SECURITY TAX RELIEF BILL TO RECEIVE HEARING
Yesterday I learned that my Social Security tax relief plan will receive a hearing in the Minnesota House Taxes Committee. You’ll recall this would eliminate state taxation on a senior citizen’s Social Security benefits. The hearing will be held on Wednesday, March 23 at 1:00.
I’ve heard from many of you that want to see the end of state income tax on your Social Security benefits and you’ve asked how you can help. Well, here’s how. Please let me know if you would like to testify on this bill. Contact me and I will pass your information along. I can be reached at rep.tony.jurgens@house.mn.
Have a good weekend,
Tony