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Last-minute deals, twists and turns: Minnesota Legislature passes $52 billion state budget

State legislators had an 11:59 p.m. deadline to make on Wednesday.

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Senate Majority Leader Paul Gazelka, R-East Gull Lake, talks to reporters at a news conference at the Minnesota state Capitol in St. Paul on June 30, 2021. Sarah Mearhoff / Forum News Service
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ST. PAUL — With a final push and some surprise twists in the past 24 hours, Minnesota legislators have dodged the threat of state agency and services shutdowns, just barely meeting their deadline to pass a $52 billion state budget.

But a final state taxes budget bill remained unfinished by midnight, failing to meet lawmakers' Wednesday, June 30, deadline.

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Wednesday at 11:59 p.m. was lawmakers’ deadline to get all 13 of their state budget bills through both chambers of the Legislature and to Gov. Tim Walz’s desk for his signature. With all but one bill complete, Walz has signed the 12 bills delivered to his desk into law — averting the potential disaster of state agency shutdowns, employee layoffs, halts to services to needy Minnesotans and more.
To find compromise between the nation’s only divided Legislature has proven difficult, with the Democratic-controlled House and Republican-controlled Senate leaders negotiating with Walz’s office for weeks now. At stake was the basic functioning of Minnesota's state government, impacting everything from state employees' paychecks to Minnesotans' camping reservations at state parks.

Speaking to reporters at the Capitol complex Wednesday evening, Walz celebrated the near end of budget negotiations, saying, "There's a lot to like in this budget."

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"You shouldn't get patted on the back for doing what you're supposed to do," Walz said. "But I'm telling you, in 2021, trying to legislate in this democracy, especially with a divided Legislature, it is quite an accomplishment."

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Minnesota Gov. Tim Walz, along with Secretary of State Steve Simon and First Lady Gwen Walz, host a news conference outside the State Office Building in St. Paul as the Legislature wraps up budget negotiations. Sarah Mearhoff / Forum News Service


As lawmakers have gotten closer and closer to their constitutional deadline, their pace has hastened, and even brought surprising twists and turns. Late Tuesday night, Walz presented a bargaining chip to the Legislature, offering a plan to rescind his 15-month-long coronavirus emergency declaration and associated executive powers, tacked onto the state government budget. That budget funds lawmakers’ offices and their staffs, the Attorney General’s office and other basic state government functions.

Legislative Republicans, who have been critical of Walz’s use of the emergency powers for months, joined Democrats in an early Wednesday vote to end the emergency. Also on Wednesday, the Senate unanimously passed the state's public education E-12 budget.

The only budget that remained as of Wednesday night was taxes. Unlike the other 12 budgets that have been approved, there isn't the same threat of agency shutdowns or layoffs if the bill is late. Closed-door negotiations between the Democratic-controlled House and Republican-controlled Senate continued well into Wednesday. As of midnight, both the House and Senate have yet to give their stamps of approval.

On the table is a tax relief bill that includes nearly $1 billion in tax cuts, including exemptions for businesses who collected federal Paycheck Protection Program aid and for workers who received unemployment benefits during the pandemic.

The Legislature could take up a bonding bill, as well, but it's not constitutionally required and could be put off for later this year.

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In another surprise announcement, Senate Majority Leader Paul Gazelka, R-East Gull Lake, told Capitol reporters Wednesday afternoon that even when they finish their budget work, the Senate likely won't leave the Capitol right away. He didn’t offer specifics, but it could be a strategy to pressure Walz to sign all of the budget bills faster.

Walz told reporters Wednesday evening that he is eager to sign all of the budget bills into law, and he doesn't plan to hold any of them up. And asked how he feels with his emergency powers relinquished, he said, "I'm the happiest man in the state, I can tell you that."

Mearhoff is a Minnesota Capitol Correspondent for Forum News Service. You can reach her at smearhoff@forumcomm.com or 651-290-0707.
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