May 16, 2022
One Week Left of Session, Supplemental Budget Framework Agreement Reached
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The Legislature Enters the Final Stretch
After a weekend of discussion, Governor Tim Walz, Senate Majority Leader Jeremy Miller (R-Winona), and Speaker of the House Melissa Hortman (DFL-Brooklyn Center) reached an agreement late Sunday evening on the framework of a budget agreement that included supplemental spending, tax relief, and a capital infrastructure proposal. The proposed “deal” would include $4 billion in supplemental appropriations and $4 billion in tax cuts over the next three years while leaving $4 billion on the bottom line.
Materials released by legislative leaders showed that the deal would include $1 billion in additional E-12 spending, $1 billion in the area of health and human services, $450 million in public safety spending, and $1.32 billion in other spending over the next three years. Additionally, the agreement includes a $1.4 billion capital investment infrastructure bill. Legislators still need to hash out the specifics of each appropriation in conference committees. The conference committee schedule can be found here.
While the leaders of both legislative majorities have signed off on the “deal,” the support of members of each minority caucus will be needed if the legislature is going to pass a capital investment bill this session. The bill must pass each chamber with a 3/5 majority vote (81 votes in the House, 41 votes in the Senate).
Senate Passes Alternative to Paid Family & Medical Leave
On May 11th, 2022, the Senate passed S.F. 3885, which would authorize private insurance companies to sell policies covering family and medical leave in Minnesota by a vote of 37-29. Authored by Sen. Julia Coleman (R- Waconia), S.F. 3885 was touted by Republican Senators as a private-market alternative to the state-run family and medical leave program promoted by Gov. Walz and the House DFL Caucus.
Specifically, the bill would authorize insurers who are licensed to issue disability insurance to create a leave benefits package for employees, similar to disability leave. Senate Democrats criticized the bill saying it didn’t do enough to guarantee workers paid leave time. Current state law requires legislative authorization before an insurance company can offer a new form of coverage in Minnesota.
If authorized, these policies could provide coverage for those:
- Who have to take a leave to provide care for family members;
- Who wish to spend time with children after birth, adoption, or the placement of a child in foster care; or
- To address a demand arising from the fact that a parent, spouse, or child of the employee has been notified of impending active duty in the armed force
S.F. 3885 contains most of the policy provisions for Senate Republicans’ alternative Paid Family & Medical Leave plan. However, the Senate’s omnibus tax bill (H.F. 3669) also contains a tax credit designed to incentivize employers with less than 50 employees to buy into these leave insurance products. Employers can receive up to a $3,000 tax credit for participating in these new leave plans.
Elections
The Minnesota Republican, Hennepin County DFL, and Congressional District 4 DFL all held their respective conventions last weekend where delegates met, selected, and endorsed candidates for the 2022 November election.
On Saturday, May 14, 2022, after 9 ballots, former state senator Scott Jensen won the Minnesota Republican Party’s endorsement for governor with 65% of the support from delegates. Earlier in the weekend, Republican state convention delegates also endorsed Jim Schultz for attorney general, Kim Crockett for secretary of state, and Ryan Wilson for state auditor.
On the other side of the aisle, longtime public defender Mary Moriarty received the Hennepin County DFL endorsement for Hennepin County attorney, beating out current House Majority Leader Ryan Winkler (DFL- Golden Valley). On Sunday, May 15, 2022, long-time DFL Congresswoman Betty McCollum (MN-4) secured the DFL endorsement on the first ballot with 64% having been challenged by progressive activist Amane Badhasso. Both Winkler and Badhasso announced their intentions to continue campaigning and run in the August primary. The DFL state convention will be held May 20-22, 2022, in Rochester Minnesota.
This year, the legislature experiencing an unusually high volume of retiring lawmakers, currently 41 legislators (20 Representatives, and 21 Senators) have announced their retirement. Together, their combined experience totals more than 547 years of service, with the average tenure being 13 years. A complete list of retiring legislators and legislators who have declared their intent to seek another office can be found here.
Important Dates to Remember
- May 20-22, 2022: DFL State Convention in Rochester - All statewide offices endorsed. (No US Senate race)
- May 23, 2022: Session’s Constitutional Mandated Adjournment
- May 17 - May 31, 2022: Candidate Filing for all constitutional offices and the MN House and Senate
- August 9, 2022: Primary Election
- November 8, 2022: General Election
Federal Update
Bills, Bills, Bills - The House and Senate Gear up for a Busy Week
The House and Senate are both in session this week as Congress tries to finish the $40 billion Ukraine aid package, take on the baby formula shortage, and deal with soaring gas prices. Covid-19 aid is stalled, and Congress will need to begin to wrestle with that too.
The House is expected to vote on two bills addressing the formula shortage this week. One, from House Education Committee Chair Bobby Scott (D-Virginia) would loosen the restrictions on what type of formula can be purchased through the WIC (Women, Infant and Children) program. About 50 percent of formula sold nationwide is purchased with WIC benefits.
House Appropriations Committee Chair Rosa DeLauro (D-Connecticut) is also preparing an emergency supplemental for funds to immediately purchase baby formula available from Chile, Mexico, Ireland and the Netherlands. On Thursday, an Appropriations subcommittee will hear from FDA Commissioner Robert Califf on the shortage.
In addition, the House will take up a bill to address price gouging by allowing President Biden to issue a national emergency to prohibit selling gasoline or fuel for homes at an “unconsciously excessive” price. The bill would authorize the Federal Trade Commission to penalize bad actors, particularly large corporations.
Both issues – the formula shortage and gas prices – are major priorities for Frontliners as they desperately try to change the narrative heading into what’s shaping up to be a ruthless political climate for Democrats going into the midterms.
Ukraine Aid Faces Senate Procedural Gauntlet
The Senate returns this afternoon to a $40.1 billion emergency spending package for Ukraine, and the same amendment standoff that has stymied quick passage of the measure.
The only way to speed things up would be to get consent from Kentucky Republican Rand Paul, who wants to add language to give authority to the special inspector general for Afghanistan reconstruction to oversee the spending in Ukraine.
Sen. Paul rejected an offer from Senate Majority Leader Charles Schumer, and Minority Leader Mitch McConnell, last week for a vote on his amendment, with a 60-vote threshold, and a separate Ukraine spending oversight bill. Sen. Paul’s hold led Schumer to start the cloture process last week. The first step is a cloture vote on the motion to proceed to the bill, which is set for 5:30 p.m. today.
Assuming there are 60 votes for cloture, then there would be up to 30 hours of debate just on the motion to proceed unless there's agreement to cut that time short. Then senators go through that process all over again to end debate on the bill and move to final passage.
The White House has said the funding is needed by late this week, when previously appropriated funding is expected to run out. In addition to restocking Ukraine’s weapons, the supplemental spending bill is needed to address short-term food needs in Ukraine and other countries, U.S. Agency for International Development Administrator Samantha Power told lawmakers last week.
Sen. McConnell led a delegation of Republican senators to Ukraine over the weekend, where they met President Volodymyr Zelenskyy. “The United States stands squarely behind Ukraine and will sustain our support until Ukraine wins this war," Sen. McConnell said in a statement. Others on the trip included Sen. Susan Collins of Maine, Sen. John Cornyn of Texas and Sen. John Barrasso of Wyoming.
Restaurant Aid Bill Could be Poised for Floor Action, but Faces Big Hurdles
A $48 billion aid package for restaurants and other pandemic-ravaged businesses the Senate is expected to take up this month faces steep hurdles, from Republicans concerned about a lack of offsets to senators in both parties who have never heard of the measure. The Senate could vote as soon as next week on a $48 billion small-business aid bill.
Republicans Divided on Semiconductor Tax Breaks in Competition Bill Talks
An effort to add bipartisan tax incentives for U.S. semiconductor manufacturing to a larger economic competitiveness package is running into divisions among House Republicans.
The top-ranking Republican member of the tax-writing Ways and Means Committee, Rep. Kevin Brady of Texas, is among those who believe giving tax breaks to chipmakers is too narrow an approach as Congress aims to get the U.S. on better footing in sectors where China leads. But Republicans who proposed the semiconductor tax credits want to see swift action, citing an urgent need for the country to attract semiconductor plants.
The Senate Finance Committee’s leaders — Chair Ron Wyden (D-Oregon) and ranking member Michael Crapo (R-Idaho) — are leading the push to add tax provisions to the competitiveness package as 107 lawmakers embark on the conference process to iron out differences between House and Senate versions of legislation. The effort kicked off with a public meeting last week, where disagreement on potential tax additions emerged.
Please reach out to any of the Larkin Hoffman Government Relations team members with any questions.
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