By: Senator Carla Nelson
The new legislative session begins on February 12. Though we will not be crafting a new state budget this year, Minnesota faces a challenging fiscal situation that will significantly impact what we can realistically accomplish.
Last year, the state had a record $19.5 billion budget surplus. However, the governor and DFL-led legislature chose to spend all of it, approving a $72 billion state budget – a 40% increase over the previous budget. They also passed $10 billion in tax increases.
Now, just a year later, Minnesota is projected to have a $2.5 billion budget deficit in 2026. This dramatic turnaround leaves little room for tax relief or investing in our shared priorities for this upcoming session.
In even-numbered years like 2024, the legislature typically focuses on passing a bonding bill to fund infrastructure projects. As a longtime member of the Capital Investment Committee, I will once again be a strong advocate for investments in critical and urgent projects like local roads, bridges, water systems, and facilities like the Rochester airport. Especially with limited funds available, infrastructure projects that enhance safety and economic growth should be prioritized.
The legislature also needs to think of this session as a ‘fix-it’ session. We should review and amend some of the laws passed during last year’s spending spree. We need to rein in spending to prevent a budget deficit and avoid further tax increases. Bills like the Earned Safe and Sick Time mandate and Paid Family and Medical Leave program need common-sense fixes after causing confusion for employers and employees alike. We also need to reduce punishing taxes like the nation-leading 9.8% business tax rate, ultimately hurting employees and consumers.
In addition, new workforce mandates have driven away business expansions and jobs. Since 2020, Minnesota has lost 54 development projects, 2,500 potential new jobs, and $6.6 billion in business investments to other states. We need bipartisan solutions to retain and attract employers so Minnesotans have opportunities to build financial security.
Finally, public safety remains a concern, especially in schools. Last year, Democrats approved a change to the law that governs school resource officers, causing those officers to be pulled from schools across the state. Some have since returned but we need to get them all back. In recent weeks we have seen large brawls at multiple Minnesota schools, and who knows how many incidents happen that we don’t hear about. We have to get resource officers back into schools as soon as possible. They support students, staff, and everyone’s safety. It must be a top priority.
The upcoming session faces several big challenges that call for restraint. Investing in critical infrastructure, making Minnesota’s economic climate more competitive, empowering schools and law enforcement, and avoiding future deficits will likely dominate the agenda.
As your state senator, I welcome your feedback on these issues. Only by working together can we create growth and prosperity for all Minnesotans. You can contact me any time at Sen.Carla.Nelson@mnsentate.gov. Please share your thoughts and concerns so I can best represent your priorities and values in Saint Paul.
It is a privilege to serve you!