Both the Minnesota House and Senate held two remote sessions over the past week that included the passing of another round of COVID-19 related policy waivers. The House and Senate education committees are still working on a bill that would address funding and policy issues raised with the implementation of distance learning for the state’s E-12 public schools.

Headlines from the past week:

  • On Tuesday, the Legislature passed another round of COVID-19 related policy waivers on a number of issues stemming from child support payments to processing commercial driver’s licenses.
  • On Thursday, the Senate passed a bill allowing restaurants to sell limited amounts of packaged alcohol to customers who order take-out or delivery. The House passed the bill Friday, and Gov. Tim Walz’s signature is expected shortly.
  • The hold up on the E-12 response bill is disagreement on the language and its effect related to schools paying hourly staff.
  • The economic update for the state, released Friday, showed state General Fund revenues for February and March $103 million below forecast amounts.

E-12 COVID-19 Response Bill

The hold up to faster action on the COVID-19 response bill for E-12 education in Minnesota is a House DFL proposal requiring schools to continue paying hourly staff in accordance with their regularly scheduled hours. There’s disagreement about the actual force and effect of the language.

Minnesota Education Commissioner Mary Cathryn Ricker weeks ago clarified the intent of the Executive Order during distance learning regarding hourly staff is that the order does not cover staff hours primarily paid for with fee-based revenues.

While testifying at a remote House Education Policy Committee on April 8, the Commissioner provided these very thoughtful comments about the issues surrounding hourly staff during distance learning:

  • “At its core, this bill sends an important message to our educators and districts that we value everyone in our school community. Providing assurances that everyone will be able to put food on their table, pay their bills and maintain affordable health care is crucial in these uncertain times.”
  • “This bill sets the highest expectations to exhaust every tool in the toolbox to pay workers before considering layoffs. It would not prohibit layoffs, but establishes clear steps that must be taken before getting to that decision.”
  • “It provides a more consistent expectation statewide, rather than a patchwork result. One of the things we have been hearing is that one district may be making budgetary decisions differently than a neighboring one, and this has been creating confusion and consternation. This bill would align expectations.”
  • “With the Legislature acting on this, it shows the state that we have true agreement on the value of all of our school workers.”
  • “Distance learning is an unprecedented act for our schools. Administrators need to meet this challenge by thinking creatively about how to deploy school workers and I have had a lot of really productive conversations with school leaders on exactly that. Leveraging the skills and unique abilities of our staff is a key component to equitable distance learning.”

What’s Next?

  • HF 4415 is slated to advance in the House on Tuesday.
  • The Senate E-12 Committee meets again on Friday.
  • MREA will continue tracking this legislation among other developments on tax and budget issues as the state grapples with new federal funds and a declining state budget picture.

State Budget Update

The $1.5 billion surplus projected for Minnesota less than two months ago seems like ancient history now. State officials are no longer able to offer such an optimistic future.

Minnesota Management and Budget (MMB) Commissioner Myron Frans and Dr. Laura Kalambokidis, the head of Economic Analysis at MMB, presented a state economic update to the House Ways and Means committee on Monday.

Facing the uncertainty of the total cost of the pandemic, the MMB is working hard to provide some direction for the Legislature regarding the state budget. The latest revenue and economic update, released on Friday, showed state General Fund revenues $103 million below forecast amounts for February and March.

Additionally, Minnesota’s macroeconomic consultant, IHS Markit, had projected 2.1 percent national economic growth in 2020, the number used by the state in developing the February Forecast.

  • IHS is now projecting a 5.4 percent decrease in state GDP for 2020.
  • When Commissioner Frans was asked about starting the budget cut conversation he replied, “I think it’s very hard to say at this point that we need to start cutting without knowing exactly where we are in terms of revenues coming in and the expenditures we need to make.”
  • Frans said he hopes MMB can provide the Legislature a better overview of the shape of the state’s budget in early May.

There’s a lot of speculation about what and how the legislature might do in light of a large deficit for the current biennium. Minnesota is about 10 months into a 24-month budget period.

MREA will be monitoring this conversation very closely as state budget decisions can directly impact local government aids, library system funding and the timing of payments to local government systems.

More Hearings & Focus

In addition to session, the Legislature continues to ramp up its capacity to hold virtual hearings. Ten House committees are now holding remote hearings, while the Senate had four remote hearings this week.

As Majority Leader Paul Gazelka closed out Thursday’s Senate floor session, he stated that the Senate intends to meet every three days to both confirm commissioners and work through bills. He further stated that the Senate will focus on three key things:

  1.  “A modest bonding bill”
  2. Dealing with oversight of the federal COVID-19 funds coming to Minnesota
  3. A tax bill aimed at jumpstarting the economy.

The Legislature can pass bills up to midnight on May 17.



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