Session Update

Most of us think about shutdowns in terms laid-off state workers, and services that are suddenly unavailable. Anyone remember when all rest areas were closed along the highways during the last shut down? Shutting state services down is costly and inconvenient. But if lawmakers miss their deadline to pass a balanced budget, the resulting government shutdown will also stop the flow of money to many of the state’s contractors on July 1.

For example, construction contractors will have to temporarily walk away from highway job sites until the legislature passes the spending bills that, taken together, make up the state budget. And it’s not just about road projects being delayed. There are a lot of hidden costs that taxpayers may have to pick up even if the shutdown is averted at the last minute. Contractors are required to wind down their job sites before July 1 arrives, which is why they’re watching the special session drama at the Minnesota State Capitol closely. That can entail moving equipment, locking down material and erosion control operations.

The Minnesota Legislature has 9 days to get all 15 budget bills done, or the state government will shut down. At the time I am writing this, the only bills that have passed are Legacy and Higher Education. There are many more budget bills to pass, including the Jobs and Economic Growth, Health and Human Services, and Public Safety bills.

For many months, there has been disagreement as to how to make businesses whole after COVID-19. Minnesota lawmakers have agreed to $150 million in business relief, though only a fraction of the money will go to businesses damaged by the 2020 civil unrest in Minneapolis and St. Paul. Of the total amount in the jobs and economic development bill, $80 million will be available for redevelopment projects, which could be used for rebuilding after the rioting. The other $70 million will cover business losses related to the COVID-19 pandemic. It’s not clear how much money will flow to riot rebuilding, though it will be far less than the $300 million that Democrats originally proposed in the wake of the unrest. Since then, some businesses have rebuilt with insurance money or private foundation funds. Government has not provided rebuilding money.

As of the date that this article was written, bonding language has not yet been agreed to or passed.

Emergency powers have not been relinquished. Police reform is still a big sticking point.

The reinsurance program has not been funded.

Both bodies still have a lot of work to do before month end. Leadership is confident they will reach agreement but the path is sure twisted to get there.

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