MN state leaders set almost $18B in budget targets

Capitol Building on a cloudy winter day
Capitol Building on a cloudy winter day(Quinn Gorham)
Published: Mar. 22, 2023 at 5:25 PM CDT
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ST. PAUL, Minn. (GRAY) -- On Tuesday, Minnesota State leaders announced their agreed-upon joint-budget targets for the 2023-2024 biennium.

“As I said on January 3, in the inaugural address, the era of gridlock is over. You’ve witnessed that because of the incredible leadership of the folks [in charge],” said Governor Tim Walz.

The newly announced targets include $18 billion in new investments in areas like education, public safety, and infrastructure.

“We’re able to set those targets amongst the House, the Senate, and the executive branch, and able to give those numbers to our chairs to go and continue to build on what we’ve already done,” Walz said.

Budget targets are typically agreed on later on in the session, often taking until May to settle. This year, the legislative trifecta that the DFL holds made it easier to set and agree on the targets.

“We have an agreement between the House, the Senate, and the Governor, about two months before we normally get to this point,” said Rep. Liz Olson (DFL - Duluth), Chair of the House Ways and Means Committee.

Olson said the early agreement gives them plenty of time to work on hammering out details.

“The chairs can go back and put together their omnibus bills, we can finish our work in the House and Senate, we can go to conference committee and hopefully have a more timely and transparent conclusion to the session,” she said.

As for the targets themselves, they feature some significant investments.

The new budget targets aim to increase education spending to $2.2 billion.

“This is the largest increase in early education, K-12, and higher education that I can recall in my time serving in the legislature over the past nearly 20 years,” said Speaker of the House Melissa Hortman.

The budgeted spending on education falls behind only infrastructure ($2.3B) and tax cuts ($3B).

“[The targets] provide the largest tax cut to Minnesotans in our state’s history,” said Walz.

Still, the $3B in agreed-upon cuts is less than the governor’s originally proposed $8B.

“There are differences of opinions on how we do this. I think there are not differences of opinion that we want to deliver this relief back to the taxpayers of Minnesota,” Walz said.

Two of the most contentious issues of the session have been tax breaks and removing the tax on social security. Hortman believes $3B is enough to get those things done.

“There’s room for nice-sized [rebate] checks in this proposal. And there is a commitment to do something... on Social Security,” Hortman said Tuesday.

Still, Republican Caucus Leaders were less than pleased with the plan.

“What we don’t see is how a full elimination of the Social Security tax cut is possible, meaning Democrats who campaigned on eliminating the tax are breaking their promises to Minnesotans. With more than $17 billion in surplus, the paltry amount of tax relief being offered leaves Minnesotans who are already struggling with rising costs behind,” said Senate Minority Leader Mark Johnson (R - East Grand Forks) in a statement.

“Contrary to what Governor Walz might have you believe, this budget is clearly focused growing government, not giving money back to Minnesotans. This isn’t what Minnesotans have been asking for. Our historic surplus should have been the impetus for tax cuts, not massively expanding government and charging the taxpayer for it,” said House Minority Leader Lisa Demuth (R - Cold Spring) in a statement.

Here are some notable line-items from the budget targets:

  • $2.2 billion for K-12 education and pre-kindergarten
  • $1.178 billion for children and families
  • $100 million for broadband expansion
  • $1 billion for housing
  • $255 million for energy and climate
  • $650 million for public safety
  • $2.3 billion for infrastructure projects
  • $3 billion in tax cuts, the largest in state history