Dear Neighbors,

It was another busy week in St. Paul, working hard to make sure you and your family are well represented in the legislature. This week I discuss SF 1 and our updated budget forecast. Scroll down below to learn more!

SF 1: Helping Minnesota’s businesses

On Thursday, the Minnesota Senate successfully passed bipartisan legislation to allow businesses to be open with no state-imposed limitation so long as the business owner maintains their own COVID safety preparedness plan. This will allow Minnesota businesses to open their doors at their own pace while providing all the safety possible for employees and customers.

This concept of one size fits all has infected every aspect of our lives and created an approach where we treat all businesses and schools the same regardless of their uniqueness.This uncompromising approach hasn’t helped our state, Minnesotans, or any of our small businesses. Today, we’re restoring trust to the process and working with businesses to open doors, get people back in work, and return Minnesota safely to normal life.

SF 1 allows businesses to be open with their own precautions in place. Instead of limitations set for the entire state by the Governor, this bill will give the power back to the people to decide what measures they need in their business. It would prohibit a Governor from closing businesses by Executive Order under Chapter 12.21 or 12.31 unless there is a majority vote of the legislature. It would also require a notice of 14 days after a vote before taking effect, giving businesses ample time to prepare for the shutdown.

Minnesota’s economy has suffered dramatically since the beginning of the pandemic and resulting lockdowns. The Minneapolis Federal Reserve reports that Employment is down 8% from the previous year and that Labor force participation down from pre-pandemic levels. Unemployment also remains above pre-pandemic levels at 4.4% in December 20 vs. 3.3% in December 19.

The pandemic has been particularly severe for small businesses and Minnesota’s hospitality industry. The National Federation of Independent Businesses reported that 1 in 5 small business owners was at risk of closing due to economic conditions.   Additionally, nearly 100 restaurants closed in the Twin Cities metro in 2020. More than half of restaurants report they face insolvency in the next few months if things don’t improve.  

Minnesota’s February Budget Forecast

The office of Minnesota Management and Budget (MMB) released its annual February economic forecast on Friday. The report, which details the state’s budget picture, projected a surplus of $1.6 billion for the 2022-23 budget cycle, an increase of $2.9 billion from the deficit projected in the November forecast.

The projected surplus is good news for the people of Minnesota, but it should not be taken for granted given the future financial hurdles we all face as the result of COVID. Our surplus is the continued success of reform and restrain that Senate Republicans have delivered over the past four years. Still, Minnesota must focus on protecting its seniors, families, main street businesses, and farmers during the upcoming biennium. That means no new taxes, controlling our budget, and ensuring existing programs are delivering results that help Minnesotans.

Senate Republicans have recently announced their 2021 session priorities placing an emphasis on safely reopening Minnesota’s schools and businesses while helping the economy recover. The caucus will also continue to focus on keeping life affordable for Minnesotans by balancing the budget without raising taxes. That means no new gas tax, no income tax, or sales tax increases. Senate Republicans will also ask that government to tighten its belt as well. Republicans will also support families by increasing choices for their kids’ education and working on expanding homeownership in their communities.

Governor Walz recently announced his $52.4 billion budget proposal. His plan includes $1.64 billion in new taxes on Minnesotans and would vault the state to number two in the nation for the country’s highest business tax rate and number three in the nation for highest income tax rates.