Budget Deal Concerns
I have many concerns with the deal that the three leaders presented to Minnesotans. My biggest disappointments are that we did not get an end to the Governor’s emergency powers and restore the Legislature’s constitutional role in governing. We also did not provide tax relief to Minnesota families who received supplemental unemployment benefits (UI) and businesses who got PPP loans before taxes were due yesterday. The tax relief will happen at the Special Session (likely June 14th.) It will cover all businesses who received a PPP loan and will be retroactive for the 2020 tax year.
With the budget targets agreed to and the money available from the federal government to cover the “cost” in the budget, there is no reason we couldn’t have passed a free-standing bill on the final day of session to give Minnesotans the certainty they needed before the midnight tax filing deadline. Indeed, we adjourned about 2:30 in the afternoon – there was plenty of time!
It was completely unacceptable to hold Minnesotans’ much-needed tax relief hostage during budget negotiations when we knew the DFL-proposed tax hikes would never be agreed to. Families and small businesses need that tax relief to make ends meet during an extraordinarily difficult year and they should not have to wait another month.
I am glad the Senate Majority leader stood strong against the many DFL-proposed tax increases on gas, income, businesses and farmers. With a $4.4 billion surplus, the state does not need additional revenue from hard-working Minnesotans, particularly when we are just beginning the economy recovery from the pandemic.
As noted above, the budget deal also failed to end Governor's emergency powers. With cases down and vaccinations continuing to rise, not to mention the lifting of the mask mandate and capacity restrictions returning to 100% by the end of the month, it is clear that the period of emergency is over. The Governor needs to relinquish his powers so the Legislature and local elected officials can resume their normal responsibilities. This is especially important for school boards, who should be able to make their own decisions about how schools will run the summer and the fall. One-man rule over schools throughout the state has not served the best interests of students well and we need to restore local decision-making.
Other concerning aspects of the budget deal are that:
- It gives the Governor authority to spend $500 million of the federal Covid-relief money. ALL of this money should be appropriated by the Legislature. The Governor should not have a half-billion of discretionary money to spend on his pet projects.
- The deal specifies that the Governor must approve of the budget bills BEFORE they are brought before the House and Senate. This is a complete violation of separation of powers and is an unprecedented abdication of Legislative power to the Governor. The agreement states: “Any policy and finance provisions included in the final omnibus finance bills must be agreed upon by the Governor, Speaker of the House and the Senate Majority Leader.”
This is “Tribunal 2.0” and it is worse than what we experienced in the 2019 budget session. The House and Senate are supposed to work together to put together a budget that then they present to the Governor to either sign or veto. Although his staff is consulted throughout this process to get a sense of what the Governor will accept, he has never had, nor should he have, the right to officially approve of Legislative budget bills before they are presented to our respective bodies for Legislative approval. This significantly undermines the separation of powers between the Executive and Legislative branches of government and should not be allowed to occur or to set a precedent for future legislative/executive interactions.
Other problems with the budget agreement are that it did not extend the healthcare reinsurance program for another year, which will likely lead to higher premium costs and fewer health insurance providers in the market next fall. Before reinsurance was enacted to stabilize the market after the Affordable Care Act, we saw double-digit premium increases and some counties only had one insurer. Pulling the plug on reinsurance without an alternative will drive up costs, limit options and harm Minnesota families.
You can read the full budget deal here.
Clearly there is a lot of work that still needs to be done before we can finalize the budget. I am hopeful we can still end the emergency powers and ensure that legislature, not the Governor, retains control of the state budget and how the federal Covid dollars are spent.
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