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Minnesota Update
Budget Continues to Take Shape
Last week the Minnesota Legislature spent most days, and multiple nights, debating and eventually passing the first iterations of their omnibus finance bills. As each chamber nears the end of its list of omnibus finance bills, both chambers turn their attention to their omnibus tax bills. The House Tax Committee rolled out and voted on its $3 billion proposal last week and it could be taken up by the full House of Representatives later this week. Meanwhile, the Senate Tax Committee is expected to release its bill on Tuesday with its first hearing will be Wednesday, April 26.
Once each body has passed their respective versions of a budget bill, legislative leaders are appointing five members from each chamber to serve on a conference committee to negotiate the differences in the bills before the May 22 deadline to adjourn.
House Budget Bills on the Move
The House of Representatives passed the following bills last week.
- Omnibus Environment, Natural Resources, Climate, and Energy Finance (H.F. 2310): Authored by Rep. Rick Hanson (DFL-South St. Paul), H.F. 2310 was passed by the House of Representatives on a 69-59 vote early last week. The bill appropriates $1.7 billion on the Department of Natural Resources, the Public Utilities Commission, the Board of Water Soil and Resources, state and regional parks and trails, and the Minnesota Zoo. The bill includes $356 million funding for energy related programs, many of which focus on transitioning to renewable energy resources. The bill also increases fees on outdoor activities like fishing and boating and directs the Pollution Control Agency (PCA) to prepare a report on how Minnesota can become a “zero waste” state by 2045.
- Omnibus Veterans and Miliary Affairs Finance (H.F. 1937): Authored by Rep. Jerry Newton (DFL-Coon Rapids), H.F. 1937 was passed by the House of Representatives on a 131-0 vote. The bill appropriates $368.9 million, from the General Fund, which is a 54% increase over last biennium funding. A few of the largest areas of funding are $190 million for veterans’ health care, $188 million for state veteran’s homes for the startup of three new facilities, and $86 million for other veteran’s programs and services.
- Omnibus State Government Finance (H.F. 1830): Authored by Rep. Ginny Klevorn (DFL-Plymouth), H.F. 1830 was passed by the House of Representatives on a 70-59 vote. The bill appropriates $1.59 billion to fund a variety of state agencies and support state and local election operations. A few notable provisions include an increase in funding for the executive branch, the creation of the Office of Tribal Relations within the governor’s office, and $140.8 million in new state IT spending. The bill also appropriates funds to support the State Emblem Redesign Commission to redesign the official state flag.
- Omnibus Transportation Finance (H.F. 2887): Authored by Rep. Frank Hornstein (DFL-Minneapolis), H.F. 2887 was passed by the House of Representatives on a 71-59 vote. The bill appropriates $8.8 billion for FY 24-25 for roads, bridges, and transit systems. The bill includes an increase in registration fees and vehicle sales tax, a .75 percent state imposed metro sales tax increase to fund transit improvements, $194 million for the Northern Lights Express passenger train from Duluth to Minneapolis, and $13.6 million for electric vehicle infrastructure.
- Omnibus Housing Finance (H.F. 2335): Authored by Rep. Howard (DFL-Richfield), H.F. 2335 was passed by the House of Representatives on a 70-57 vote. The bill appropriates $1 billion for state programs including homeownership investment grants, a statewide rental assistance program, housing voucher programs, and family homeless prevention assistance. The bill also includes a new .25 percent sales tax in the seven-county metro area to support rental assistance programs.
- Omnibus Agriculture Finance (H.F. 2278): Authored by Rep. Samantha Vang (DFL-Bloomington), H.F. 2278 was passed by the House of Representatives on a 70-58 vote. The bill includes $163 million in General Fund spending for the Department of Agriculture and $125.7 million for the Office of Broadband.
- Omnibus K-12 Education Finance (H.F. 2497): Authored by Rep. Cheryl Youakim (DFL-Hopkins), H.F. 2497 was passed by the House of Representatives on a 70-60 vote. The bill appropriates $23.2 billion to the state’s K-12 education system, a 10.6 percent increase over the base. A few significant funding initiatives include $730 million toward special education, $705 million increase to the public-school funding formula, $85 million for the permanent expansion of pre-k, and $60 million to double funding for American Indian education to fund tribal schools and school districts, based on the number of American Indian students enrolled, as an overall increase to their yearly funding. There is also$65.9 million for paraprofessional and special education to pay them for preparatory time, professional development, and orientations, and $73 million to overhaul literacy education.
- Omnibus Children and Families Finance (H.F. 238): Authored by Rep. Dave Pinto (DFL-St. Paul), H.F. 238 was passed by the House of Representatives on a 70-60 vote. The bill would establish a new Department of Children, Youth and Families, combining various programs and services currently administered by the Department of Human Services and the Department of Education. The bill also appropriates $875 million to fund initiatives related to childcare, food insecurity, and economic stability.
Senate Budget Bills on the Move
The following bills passed the Senate last week:
- Omnibus Human Services Finance (S.F. 2934): Authored by Sen. John Hoffman (DFL-Champlin) was passed by the Senate on a 63-4 vote and appropriates $14 billion from the General Fund for FY24-25. The bill allocates $126.4 million in new funding for nursing homes and $311.4 million in rate increases for various disability services. The bill also eases the Medicaid spend down requirements for individuals with disabilities and older Minnesotans and eliminates certain fees on some parents of children with disabilities.
- Omnibus Higher Education Finance (S.F. 2075H.F. 2073): Authored by Sen. Omar Fateh (DFL-Minneapolis) was passed by the Senate on a 36-31 vote and spends $4 billion for FY 24-25 toward education related initiatives. The primary piece of this bill is the Minnesota Commitment to Higher Education Act which provides students with scholarships to cover tuition and fees for Minnesota residents attending an in-state public or tribal college or university, if the student falls below income requirements, applies for FAFSA or state aid application, meets academic requirements and does not yet have a bachelor’s degree. Also included is funding for the American Indian Scholars Program, and changes to the teacher shortage loan program, prioritizing racial and ethnic teachers who are unrepresented in the workforce.
- Omnibus Legacy Finance (S.F. 1682H.F. 1999): Authored by Sen. Foung Hawj (DFL-St. Paul) was passed by the Senate on a 40-27 vote. the bill appropriates funds for the Outdoor Heritage Fund, Clean Water Fund, Parks and Trails Fund, and the Arts and Cultural Heritage Fund. Total for all funds is $821 million. The money appropriated for these funds comes from a statewide sales tax already in place for these funding areas.
- Omnibus Health and Human Services Finance (S.F. 2995): Authored by Sen. Melissa Wiklund (DFL-Bloomington) was passed by the Senate on a 35-32 vote. The bill includes a number of DFL initiatives that seek to reduce the cost of health care in Minnesota. Specifically, the bill would establish the Health Care Affordability Board to monitor, limit, and set health care costs and remove the income eligibility cap on the state’s MinnesotaCare program to create a full “public option” insurance program with the goal of allowing more people in the private market to qualify for public insurance. The bill also seeks to regulate the way hospitals handle issues related to nurse staffing and create new state oversight of private health care transactions.
- Omnibus Military and Veterans Finance (S.F. 2247H.F. 1937): Authored by Sen. Nicole Mitchell (DFL-Woodbury), H.F. 1937 was passed by the Senate on a 66-1 vote and includes $381.6 million in General Fund spending. A few of the larger appropriations include $191 million for veterans’ health care and $68 million for various veteran’s programs and services such as veteran’s cemeteries, soldier assistance, veteran homelessness, and the veterans bonus program.
- Omnibus State Government Finance (S.F. 1426H.F. 1830): Authored by Sen. Erin Murphy (DFL-St. Paul), H.F. 1830 was passed by the Senate on a 34-33 vote. The bill includes the creation of the Office of Tribal Relations within the executive branch, an increase in spending for the state IT infrastructure system, the creation of the Ranked Choice Voting Advisory Task Force, and the provisions from SF 2051 which makes changes to various campaign finance and caucus participation provisions, among others.
- Omnibus Environment and Climate Finance (S.F. 2438H.F. 2310): Authored by Sen. Foung Hawj (DFL-St. Paul) was passed by the Senate on a 37-29 vote and spends a net total $670 million in General Fund dollars. Included are appropriations to the Minnesota Zoo, the Pollution Control Agency (MPCA), the Department of Natural Resources (DNR), the Board of Water and Soil, the Science Museum, and the Minnesota Compensation Corps, among others.
Additional Notable Bills
- Today the House of Representatives plans to take up HF 100 (Stephenson), legislation that would legalize adult-use cannabis. The Senate bill is continuing to move through the process as well.
- The Senate passed a few other notable bills last week that have been priorities for the majority, including a ban on conversion therapy and a bill that includes protections from legal repercussions and extradition orders for transgender people and their families traveling to Minnesota to receive gender-reaffirming care.
Dates of Note:
- The Minnesota Legislature is constitutionally required to adjourn the regular session no later than May 22, 2023
Federal Update
Good afternoon, McCarthy plans to put his debt limit bill to a vote. Biden's Labor secretary nominee is voted on in committee. Senate Judiciary, following a Supreme Court order regarding Mifepristone, hears testimony on reproductive rights.
1. Ready, debt, go. House Republicans gear up for a vote on their bill to address the debt ceiling, cap spending, and much more.
2. Labor votes. Biden's Labor secretary pick is scheduled for a committee vote this week as the number of Democrats who would back her floor remains unclear.
3. After Dobbs. Senate Judiciary is likely to weigh in on the Supreme Court order on Mifepristone in a hearing on reproductive rights in a post-Dobbs world.
4. On the radar. Looking for ways to cut the deficit and shrink Medicare spending, the Biden administration and Congress have zeroed in on one controversial policy idea.
Schedules
White House: Biden holds an event honoring the Council of Chief State School Officers' 2023 Teachers of the Year. Later in the afternoon, he meets with Tennessee State Reps. Justin Jones, Justin Pearson, and Gloria Johnson to discuss gun regulations.
House: Not in session; convenes Tuesday at 2 p.m.
Senate: Not in session; convenes Tuesday at 3 p.m.
House Republicans Plan to Vote on Debt Limit Legislation
House Republicans plan to pass their proposal to raise the debt ceiling this week. The draft bill is meant to serve as a starting point for negotiations with Democrats and President Joe Biden, even as they insist that House Speaker Kevin McCarthy, R-CA, is holding the debt limit "hostage" to secure GOP legislative wins. House Rules meets to prepare the bill for the floor, where debate on the measure is expected to begin on Wednesday. It would raise the current $31.4 trillion borrowing limit by $1.5 trillion or suspend it through March 31, 2024, reinstating the limit at whichever point happens first. The legislation would cap fiscal 2024 discretionary spending at $1.47 trillion, an 8 percent cut from comparable funding this year, and includes several other measures popular with Republicans.
But some in McCarthy's caucus want changes to leadership's bill. The speaker last week declined to answer whether he would allow changes. House Majority Leader Steve Scalise, R-LA, said leaders are still listening to member feedback but that the bill has been carefully negotiated.
Senate HELP to Vote on Labor Secretary Nominee
Acting Labor Secretary Julie Su's nomination to be secretary could get through committee this week, but could face delays before a confirmation vote in the full Senate. Senate Health, Education, Labor, and Pensions is scheduled to vote on Su's nomination Wednesday. The nominee, who stepped in as an interim leader in March after Marty Walsh’s departure, will likely be approved in committee.
But she's been sharply criticized by Republicans, and some moderate Democrats who don't sit on Senate HELP are reportedly on the fence. Democratic Sens. Joe Manchin III of West Virginia and Jon Tester of Montana, along with independent Sen. Kyrsten Sinema of Arizona, are thought to be the votes to watch on Su’s confirmation. Republicans grilled Su at last week's confirmation hearing about her track record as California’s Labor secretary during the pandemic, the state’s controversial independent contractor law and her experience mediating large labor disputes.
The White House signaled it was aware of the need to win over more senators ahead of a floor vote, which leaders could hold off scheduling until the return of Sen. Dianne Feinstein, D-CA., given tight margins in the chamber.
Senate Judiciary Examines Reproductive Rights Post-Dobbs
Senate Judiciary Democrats turn their attention in a hearing to reproductive rights for the first time since the Supreme Court's decision in Dobbs v. Jackson Women’s Health Organization. The panel has yet to announce who will testify Wednesday on the effects of the ruling from the high court overturning the constitutional right to an abortion. But Democrats are sure to question witnesses on how Congress can respond to what they see as women losing the ability to make their own reproductive health care decisions. "Republican-led legislatures have passed abortion bans in more than a dozen states, and now, a single federal judge in Texas has sought to upend our federal drug approval process," Judiciary Chairman Richard J. Durbin, D-IL, said in a statement, referring to a case related to a commonly used abortion medication Mifepristone.
The Supreme Court on Friday put on hold lower court rulings that would have taken mifepristone off the market, temporarily safeguarding access to the drug while the challenge to FDA approval moves through the courts.
On the Radar: Washington Weighs Paying Hospitals Less
As the Biden administration and lawmakers look for ways to cut the deficit and shrink Medicare spending, some have zeroed in on one controversial policy idea: paying hospitals less.
Backed by bipartisan members of Congress and groups spanning the ideological spectrum, the proposal would require Medicare to pay the same rate for some outpatient services regardless of the type of facility it was provided in. Medicare pays hospitals a higher rate for most of those services than it does for physicians’ offices and surgical centers.
Endangered Species: Members of Congress are eyeing permanent legislation that would prevent the enforcement of a 2015 ruling on the Endangered Species Act, a change they say is necessary to avoid years of bureaucratic entanglements.
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