2021 Legislative Wrap-Up

Budget Finalized, Session Adjourned, What’s Next?

After a lengthy June special session, the state legislature and Governor finalized budget bills just in time for the start of the state’s new fiscal biennium. While the House of Representatives adjourned their session, the State Senate remained in special session for an additional week to discuss the Governor’s Commissioner appointees. Frustrated on a variety of policy topics, the Senate GOP majority appeared poised to vote to not confirm several Walz Commissioners.

After making it clear to the Governor that MN Pollution Control Agency Commissioner Laura Bishop would not be confirmed, Ms. Bishop offered her resignation, which seemed to appease the Senate GOP leadership enough that they agreed to adjourn the special session as well. As it currently stands, the legislature will return to the regular biennial session on January 31, 2022.

September Special Session Determines Bonus Pay 

Before January 2022, however, there will be at least one more special session in September. A nine-member commission will be put together this summer to provide recommendations on distributing $250 million in federal “frontline worker pay” to workers, “including but not limited to long-term care workers.” In developing recommendations for issuing these payments, the commission, “must consider factors including a frontline worker’s increased financial burden and increased risk of virus exposure due to the nature of their work.” An estimated 1.1 million Minnesotans are said to be the potential pool of recipients for these funds.

Getting to a Final Deal

Minnesotans sent a divided legislature to St. Paul, once again, in the wake of the 2020 general election. Amidst the COVID-19 pandemic, racial tensions over community policing, projected budget shortfalls and the continued use of peacetime emergency powers by Governor Walz, the legislature began their work in a virtual format last January. Six months later, the Governor and legislature arrived at a budget deal increasing the state’s two-year budget to $52 billion. The budget deal also includes a tax bill that sends roughly $740 million back to taxpayers, at least for companies who collected PPP loans and individuals who collected unemployment insurance. The policy changes were light as the Senate GOP and House DFL had to walk away from their more partisan priorities to get budget bills passed by both chambers.

Legislature Reconvenes January 2022 with General Election in November 2022

The legislature reconvenes their regular biennial session on January 31, 2022 with an anticipated adjournment date of May 16, 2022. Unlike the odd-numbered session, where a new budget needs to be enacted, there won’t be any such pressure in 2022, certainly nothing that would force another summer-time special session.

Before they reconvene, Legislators will be looking at a new state legislative district map this fall. All 201 state House and Senate seats are on the election ballot in November 2022, along with the Governor, Constitutional Officers and the Congressional Delegation. Many insiders anticipate a significant number of retirements next year. After the 2022 election, state Senators will enjoy back-to-back 4-year terms before the 2030 census begins.

The 2022 session is a time to focus on a Capital Investment or “Bonding” bill. The legislature and Governor also left $900 million on the bottom line of the American Rescue Plan funds allocated directly to the state of Minnesota. These dollars will be the source of much debate over the next year. If the state’s budget continues to improve and we return to surplus projections in the November and February forecasts, we’ll see increased pressure by DFLers for new spending and Republicans for tax cuts, all ahead of the 2022 general election.