Skip to main content Skip to office menu Skip to footer
Capital IconMinnesota Legislature

Legislative News and Views - Rep. Lisa Demuth (R)

Back to profile

Legislative update

Friday, February 11, 2022

Dear Neighbor,

First off today, I want to say I was pleased to present Kaitlyn Gilk with a House Resolution commending her for her work to earn a Girl Scout Gold Award, raising more than $22,000 to make Automated External Defibrillators more accessible around the clock throughout the community.

Congratulations again, Kaitlyn, and thank you so much for your efforts to help save lives in our area!

Demuth pic

As for legislative news this week:

Tax relief

Tax relief remains at the forefront in the Legislature early this session with a $7.7 billion state budget surplus as the backdrop. House Republicans are authoring numerous bills to help in this regard, including ones I am co-authoring to prevent businesses from suffering an unnecessary tax increase and to end our state tax on Social Security.

H.F. 2728 is the bill I am co-sponsoring to spare local businesses from suffering a tax increase at a time the state has its historic surplus. On March 15, business owners may face a 15% or more payroll tax hike. This is due to record-setting unemployment claims that depleted Minnesota's Unemployment Insurance Trust Fund amid the COVID-19 pandemic.

The federal government provided more than $1 billion to make up for the shortfall. Now, to account for that deficit, Minnesota payroll tax rates are set to increase unless the Legislature acts.

Like the rest of us, businesses are experiencing higher costs on pretty much everything these days. Inflation is at 40-year highs, there are supply chain issues, workforce challenges, and beyond. More than 35 other states have already used federal COVID relief funds to address their UI deficit, and Minnesota remains one of fewer than 10 states that still has an outstanding debt in our UI trust fund.

The Minnesota Senate Finance Committee has unanimously approved a bipartisan unemployment insurance repayment bill. Meanwhile, House Democrats advanced a proposal on a party-line vote to repay the unemployment insurance trust fund only partially.

Under the House majority’s proposal, the UI fund would only be repaid to $0, rather than the full repayment proposed by House and Senate Republicans, as well as Gov. Tim Walz. The Department of Employment and Economic Development has confirmed that failure to fully repay the trust fund would still trigger six years of increased tax rates for businesses.

It is a major cause to concern to see the House majority indicating it wants the UI tax relief to be packaged with other non-related issues. This would delay progress at the very least and, at worst, altogether derail this important legislation.

Committee work

House committees continue to get organized and up to speed on current issues and are conducting bill hearings. As a member of two committees that address children and education, I continue working from the position that parents deserve to know what lessons are being taught in our schools and have a right to interact with their local school board. I will keep you in the loop as any issues related to that subject develop.

Have a good weekend, watch for more from the Capitol soon and, as always, your input is welcome.

Sincerely,

Lisa

Recent News for Rep. Lisa Demuth