The 2022 legislative session has ended, and though Minnesotans’ top priorities this year were inflation and public safety neither of those topics were officially addressed prior to adjournment.
Earlier in the week, the House and Senate majority and Governor Walz agreed to a framework that would include $4 billion in tax spending, $4 billion in new spending, and $4 billion remaining unspent in case the economy declined prior to the start of 2023 session.
By the time session ended, the House and Senate had reached agreement on some areas within state government and remained miles apart in some others.
One area where compromise was reached was on a comprehensive taxes proposal. While I wasn’t thrilled with everything included in that agreement, I was extremely pleased to see that my legislation that would eliminate the state tax on Social Security benefits for ALL Minnesota senior citizens was in the final plan. Unfortunately, that bill never came to the House floor for a full vote. This was unfortunate as this is the closest we have ever come to eliminating this unnecessary tax in our state.
The House Democrat majority refused to bring the taxes bill forward until billions worth of new spending had been approved. The Senate Republican majority refused to pass any new spending measures until the House approved tax relief. And with that standoff, session ended with a thud.
It is worth remembering that some important provisions were approved and signed into law this year. We extended our reinsurance program, which significantly lowers health insurance premium rates for those Minnesotans who are forced to purchase it on the individual market, for five years and provided funding for it for three of those years. We authorized bonus checks to front-line workers who put their lives on the line during the early stages of the pandemic. We also solved our unemployment insurance trust fund debt problem, which eliminated a 15% tax increase on every Minnesota employer. Locally, the Lake Rebecca improvement project received $1 million through Legislative Citizen Commission on Minnesota Resources (LCCMR) funding.
But a comprehensive capital investment plan – even numbered years are known as the bonding years in the state legislature – was not brought forward. And on the issues of providing tax relief to Minnesotans who are struggling with higher grocery bills and $4 per gallon gas, and addressing public safety concerns across our state, agreements were also not reached.
With all of that said, while it appears everything is dead, the governor could always call us back into special session. As of this writing a special session is not imminent, but if he believes legislative leadership is getting closer to consensus in several areas he could call us back to St. Paul.
It’s worth remembering that we don’t have to spend any money this year. A $52 billion budget will cover our state until June of 2023. Most reasonable people understand this should be enough to make state government function. Any spending bill that would be enacted in special session would be permanent and ongoing, which gives many lawmakers heartburn.
While special session remains up in the air, in my opinion not having one is not the end of the world. There’s nothing wrong with entering the 2023 legislative session – an actual budget year – with a significant financial cushion if the economy doesn’t falter. I will be sure to keep you updated if anything changes, but for now session has ended and much of the budget surplus many of us thought would be allocated this year remains unspent.