FRIDAY, MAY 14, 2021

CONCLUSION OF 2021 SESSION: Minnesota lawmakers are not going to pass a budget by Monday’s regular session deadline. Negotiations around budget targets have been ongoing, but no dollar amounts have been announced as of Friday afternoon. On Thursday, Governor Walz acknowledged that tax increases on people with high incomes won’t survive negotiations and he said he’s working for a deal to avoid a state government shutdown. Legislators and the Governor must agree on a budget by June 30 to prevent a shutdown. 
Seven out of the past 10 budget-setting legislative sessions have required a Special Session to complete their work. The state had government shutdowns in 2005 and 2011. During those shutdowns, a court appointed Special Master was able to deem services essential and allow funding to continue to flow to them. But that option went away with a 2017 state Supreme Court decision that emerged from a previous budget battle. Only the Legislature can appropriate money, ruled the court in The Ninetieth Minnesota Senate v. Dayton, an opinion written by Chief Justice Lorie Gildea.
Under state law governing emergency powers enacted in response to COVID-19, Walz must call the Legislature into special session whenever he extends a peacetime state of emergency. Governor Walz extended the peacetime state of emergency today and he’ll likely do it again on or around June 14.
That leaves two scenarios for what might happen between now and Monday: 
  • If Governor Walz, Senate Majority Leader Paul Gazelka, and House Speaker Melissa Hortman reach an agreement on the size of the two-year state budget — likely to be in the $50 billion range — legislative committees could spend the time between the end of the regular session and the start of a special session working out the many spending and policy disagreements. 
  • If the leaders — two DFLers and one Republican — don’t agree on the size of the budget, then the current state of uncertainty remains, with no deadline pressure to hurry things along, at least until June 30.
PEACETIME EMERGENCY EXTENDED: Governor Walz today signed Executive Order 21-22 to extend the peacetime emergency in Minnesota. As of today, the federal government and 45 states remain in a state of emergency. Governor Walz also signed Executive Order 21-23 ending Minnesota’s statewide mask requirement, aligning Minnesota with new Centers for Disease Control and Prevention (CDC) guidance on face coverings.
FEDERAL FUNDS GUIDANCE ANNOUNCED: On Monday, the U.S. Treasury Department announced that Minnesota will receive more than $2.8 billion in federal relief funds from the American Rescue Plan Act (ARPA), roughly $200 million more than expected. The $1.9 trillion American Rescue Plan Act includes $350 billion in emergency funding for state, county and city governments. The final funding totals and guidance on how the money can be spent arrived in the midst of budget negotiations at the Legislature. Senate Republicans have been adamant that the legislature should have a say in how the federal funds are used, while House DFLers have been largely silent. Governor Walz can appropriate the funds if the legislature is not in session, sending notification of the spending to the Legislative Advisory Commission (LAC). 
MDH/COVID-19:  Minnesota’s COVID numbers continue to improve, with cases now averaging just over 1,000/day. David Montgomery of MPR News said on Twitter that cases will probably fall below 1,000/day tomorrow for the first time since March 17. However COVID numbers remain elevated in Minnesota and Michigan relative to the rest of the Upper Midwest. Minnesota has a 7-day positive % between 6%-10% and 128 cases per 100,000 people in the last 7 days. 61% of Minnesotans over age 16 have received at least one vaccine dose (2.7 million)
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