Friends and neighbors,

More than 6,500 Minnesotans lost their lives. Businesses were shuttered. Thousands lost their jobs.

But Minnesotans are resilient. They have held strong in the face of a worldwide pandemic and showed care and compassion to their neighbors. They endured constant changes from Governor Walz to everything from school and business closures all the way down to how many people could gather in their backyard. They took care of their neighbors when they were sick. They helped businesses keep their doors open when they were struggling themselves. Even now, they are using social media to help complete strangers find vaccines. These folks deserve recognition.

These are our COVID Heroes.

LEGISLATIVE RECAP

Pellet Incentive

Earlier this week I presented legislation that would create a Pellet Incentive program. My bill SF 1163 would allow the Commissioner of Commerce to make payments to eligible industrial wood pellet producers for up to 10 years after the producer begins production, at $25 per ton.

• This legislation seeks to provide financial incentives for the production of industrial wood pellets in Northern Minnesota. The proposed plants would be located in Bemidji and/or Grand Rapids

Sawmill residuals, the byproducts created when making lumber, and forest residues – the unused portions of the harvested trees and materials from diseased, distressed, or burned trees – would be used to make the industrial wood pellets. Benefits to this bill include:

• The creation of new jobs
• An increase in wages
• $17 million per year in export revenue
• Over $56 million in Annual Economic Activity
• Providing beneficial revenue to the School Trust Lands
• Improvement of forest health 

We are a state with a lot of forested lands, approximately 18 million acres. Minnesota has a strong logging history, but in recent years we have witnessed a declining industry. We have lost a number of sawmills and wood processing facilities. If there had been a market for residual byproducts, maybe these businesses would have fared better.

• My bill gives us a chance to return market potential back to Minnesota. This incentive program is economically good for the area, it will revitalize the industry, and it will provide a new energy source for our state’s economic and environment future
• Funding for this project would come from Minnesota’s Renewable Development Account, which typically supports investments in bioenergy projects

I’m excited about this bill and the potential it holds. What we’re talking about would open our state up to the renewable energy market, while also improving forest health. This is a great, cost-effective way to help out our businesses while creating jobs across the State.

Paycheck Protection Program (PPP) Update

On Thursday, the Minnesota Senate passed legislation that seeks to ensure businesses are not penalized for keeping their employees on payroll through the COVID-19 pandemic. Last year the federal CARES Act established the PPP program for small businesses experiencing hardship and revenue losses resulting from the COVID-19 pandemic.

In order for the loan to be forgiven by the federal government, the loan needed to be utilized to fund qualifying costs (payroll, health insurance for paid sick/medical/family leave, mortgage interest payments, rent, utilities), and 60% of the loan proceeds needed to be used for payroll costs.

• In December 2020, the federal stimulus bill made it evident that forgiven PPP loans were not considered taxable income at the federal level. Unfortunately, Minnesota does not automatically conform to federal tax law changes
• SF 263 seeks to bring Minnesota into federal conformity so that these forgivable loans are not taxed in Minnesota. With tax season on the horizon, passing this bill offers relief to businesses and business owners that have been left wondering if they would be hit with an unexpected tax, after a year of uncertainty and floundering revenues 

The passage of this bill ensures that small businesses that have been negatively impacted by COVID in the last year are not also hit with an unprecedented tax for trying to save their businesses and helping their employees during a pandemic.

• This loan program was a lifeline meant to help business owners keep their doors open and their employees paid, and now they’re facing an unexpected tax and it’s just not right
• The bottom line is folks are still struggling and piling on a new tax after such a hard year is not the answer

Our small businesses did their part to keep our state’s economy afloat, and now it’s time we do ours. I’m glad we passed this bill because we absolutely need to be supporting our small businesses through economic recovery.

Federal Stimulus

Congress passed another round of federal stimulus money and was signed into law this past Thursday by President Biden. Approximately $5 billion will come to the state and local entities from this stimulus.

The GOP Senate started this session committed to balancing the budget without raising taxes. With every week that passes, it’s easier to stick to that commitment. Minnesota already has a $1.6 billion budget surplus, the stimulus sends nearly $5 billion to the state, and revenue collection continues to exceed expectations. The goal for these federal monies is to use it for COVID-related needs.

• There is absolutely no reason to raise taxes on Minnesotans! The Governor should drop all his proposed increases. We know an economic recovery from COVID-19 is a Minnesota priority that can be done without tax increases

LEO (Law Enforcement Operations) Account

The Senate passed legislation last Monday funding the Law Enforcement Operations Account (LEO). It secures resources for emergency law enforcement operations tied to extraordinary and unplanned emergency events. The resources can be accessed by state and local law enforcement following an emergency declaration or when the Minnesota State Patrol requests assistance for state properties, particularly the Minnesota Capitol.

The Law Enforcement Operations Account will be funded with a $20 million appropriation from the General Fund. Applications for the funds can then be made by both tribal or local entities and are not exclusively limited to law enforcement.

• Fire services, emergency medical services, and other governmental operations can also apply for funding for their needs 
• Eligible costs include mutual aid, overtime, food, lodging, damaged or destroyed equipment, and emergency management costs. Jurisdictions experiencing the emergency are eligible for reimbursement up to 75% of their expenses and assisting jurisdictions can receive the full 100% 

Applicants have 90 days following the event to request funds. All applications will be reviewed by a five-member reimbursement panel consisting of the Commissioner of Public Safety, two sheriffs, and two police chiefs, who will evaluate the requests and make binding recommendations for reimbursement from the account.

• Passing this bill is providing a bailout for Minneapolis, but is an offering of support for law enforcement, and a commitment to public safety for ALL Minnesotans
• No matter where you live, Minnesotans deserve to have the confidence to believe that their elected government leaders are taking every available step to keep them safe and protect them from violence and unrest

This bill that ensures Minnesota is prepared to provide adequate public safety and ensure the preservation of life, safety, and property.

Fun stuff to break up the doom & gloom

• Sunday March 14…Daylight saving time begins. Don’t forget to set your clocks ahead one hour and check the batteries in your CO2 & Smoke Detectors
• Sunday March 14…Pi Day. It is a day to celebrate the mathematical constant pi (π) and to eat lots of pie. It is celebrated in countries that follow the month/day (m/dd) date format, because the digits in the date, March 14 or 3/14, are the first three digits of π (3.14). Pi Day was founded by Physicist Larry Shaw in 1988
• Wednesday March 17…Saint Patrick’s Day. Have a beverage and a bite at your local restaurant

That’s all for this week’s update. Please do not hesitate to reach out to me to share any thoughts, concerns, or questions you may have. I can be reached by phone at 651-296-9651 or by email at sen.paul.utke@senate.mn

Have a great week!
Paul