Minnesota Legislature wraps up $72 billion state budget, ends legislative session with far-reaching impact

ST. PAUL, Minn. -- The Minnesota Legislature adjourned on Monday, marking the end to a consequential session where newly empowered Democrats passed a slate of progressive policies with wide-ranging impact.

Lawmakers ended their work before the midnight deadline, sending the last piece of the next two-year $72 billion state budget, a $2.6 billion infrastructure package and $300 million in emergency funding for nursing homes to Gov. Tim Walz's desk for signature.

These bills are among the final acts in a legislative session that will be remembered for years to come.

"That's definitely on the bingo card—transformational and historic," House Speaker Melissa Hortman, DFL-Brooklyn Park, said of the session.

Democrats took back total control of state government—the House, Senate and governor's office—for the first time in a decade this year. And they didn't waste any time. DFL lawmakers before final votes were cast celebrated that they had checked off everything on their wish list.

Among the bills on that initial agenda: codifying abortion rights; setting a new carbon-free electricity benchmark; free breakfast and lunch for all children in school; a state-run paid family and medical leave program; gun regulations; expanding voter access to the polls and much more. 

Democrats also said OK to legalizing recreational marijuana for adults 21 and older.

"That is an incredible accomplishment with a two-vote majority in the House and a one-vote majority in the Senate," said House Majority Leader Jamie Long, DFL-Minneapolis. "We set out a vision and we delivered on it."

But Republicans believe the Democrats' agenda is out-of-step with Minnesotans---and represents government overreach. They described the session as "very disappointing" and criticized both the speed with which Democrats passed significant policy changes and the onslaught of tax increases poised to become law.

"Even a little bit of tax relief that is in some of the bills is not going to be recognized because all of the expenses –from our car tab fees and taxes and delivery fees—increases costs all the way around," House Minority Leader Lisa Demuth, R-Cold Spring, said. "That is consequential and that will take forever to recover."

Lawmakers worked through the weekend to wrap up the remaining pieces of the next two-year budget, which is a 38% increase in state spending over the current biennium. Part of that includes a tax bill with $3.3 billion in cuts targeted at low- and middle-income Minnesotans, including one-time rebate checks for an estimated 2.5 million households.

Nearly all of the $17.5 billion budget surplus that lined the state's bank account at the beginning of session is accounted for.

As session neared its end, the window to approve a state borrowing package to finance local infrastructure projects—known as a "bonding" bill—seemed all but closed, until leaders struck a deal Saturday for a $2.6 billion deal that's a mix of general fund cash and general obligation bonds.

Bonding bills need a supermajority to pass, so Republican buy-in this year was essential. Senate Republicans rejected plan earlier in the year, hoping it would give them leverage in pushing Democrats to pass broader tax cuts.

But in the end, DFL leaders agreed to $300 million in emergency aid for nursing homes in crisis left out of other budget areas, in exchange for Republicans' last-minute support. Both chambers approved the measures Monday night. 

"It got to the point where—do we take care of the vulnerable in Minnesota or do we continue to demand something we knew that Democrats weren't interested in?" Senate Minority Leader Mark Johnson, R-East Grand Forks, said. "In order to make that bill work, we knew we had to do the right thing and choose seniors."

But the final vote of session was on a last-minute overhaul of a bill designed to protect the state's nurses and keep them from leaving the profession. 

That legislation set off a showdown between DFL lawmakers and nurses pushing for passage of the "Keeping Nurses at the Bedside Act," and the Mayo Clinic, which threatened to pull billions in investments out of Minnesota if they were required to meet the staffing requirements under the bill.

There was a deal to exempt all Mayo hospitals from that part of the bill, before the provision was scrapped altogether in session's final hours.  

What remains of the now gutted original bill includes protections against workplace violence and some student loan forgiveness for nurses.

Despite its revisions, authors hailed it at as "nation-leading" policy to bolster nurse safety.

"We didn't get everything that we wanted. We're not going to get everything that we need," said Sen. Erin Murphy, DFL-St. Paul, one of the bill's authors. "But what we have…is important, transformative work for nurses, for direct care workers and the patients in their care."

Lawmakers will gavel in next year on February 12.