In Minnesota we care about each other and our families
We need to make sure every community thrives across Minnesota by expanding access to affordable childcare and housing, investing in infrastructure and broadband internet, and giving local leaders the tools they need to succeed. We all do better when everyone has the tools they need to live a joyful life and work with dignity. In Minnesota, everyone contributes and everyone benefits.
A growing caregiving crisis in our state means too many Minnesotans are forced to choose between taking care of themselves or a loved one and a paycheck. Many jobs provide limited to no benefits to workers who have given birth to a child or have an ill relative that needs care. The pressure of paying the bills while caring for loved ones puts pressure on families across the state.
DFLers have proposed solutions that would allow workers to earn paid leave as they work in their job(s). One bill introduced would allow Minnesota workers up to 12 weeks of paid leave so they can care for a family member with a serious health condition or to bond with a newborn or newly adopted child. Another bill would give Minnesota workers the ability to earn paid time off to use when they are sick or to take care of an ill family member for short periods of time.
Senate DFLers have been unable to move either of these bills forward because Senate Republicans remain opposed to them. What is even more disconcerting is that Senate Republicans have not even tried to develop alternatives to these DFL proposals. Despite this Republican opposition, the Senate DFL will continue to fight for workers and their families this session.
The State of Minnesota has a moral and economic interest in ensuring people have a chance to make their lives better. Investments in helping people achieve better lives through career education undoubtedly benefits them, their families, and the State of Minnesota. Equity funding started in 2016 after a report found Minnesota was failing people of color economically. In response, the State of Minnesota has invested more than $90 million in equity funding. The DFL Senate will look for additional investments this session in equity funding to help people prosper and meet the demands of Minnesota businesses.
Some hospitality employers in employment settings where workers are tipped may encourage lawmakers to consider tip penalty legislation. The bill would allow employers to pay tipped employees a minimum wage that would decrease in value if a tipped employee’s wages and tips were above a pre-determined amount set by law.
The tip penalty woud lower workers pay over time. Tipped workers would be less likely to be able to afford housing, food, and other necessities to better their lives. A tip penalty would not just impact restaurant employees but all employees who receive a tip (ride services, hair stylist, food delivery drivers, etc.).
The governor’s bonding proposal calls for a $276 million investment in safe and affordable housing. That includes $200 million in Housing Infrastructure Bonds to be awarded on a competitive basis to housing developers. These types of bonds are used for supportive housing (youth, veterans, long-term homelessness, persons with disabilities, and people with mental illness), preservation (Section 8), community land trusts, senior housing, and manufactured home parks. The proposal also recommends $60 million for Public Housing Rehabilitation Funding to be invested in aging public housing that needs repair.
Select Committee on Home Ownership Affordability and Availability
Although a lack of affordable housing is a statewide problem impacting job creation and family budgets in every corner of the state, Senate Republicans planned no new money for housing in their original 2019 budget proposal. Instead, they cut proven programs, such as the Challenge Program, and resisted DFL-led investments in Homework Starts with Home, Family Homeless Prevention, and rental assistance.
By the end of last session, the DFL successfully included $15 million in new spending for housing and acceded to creating a new Select Committee on Home Ownership Affordability and Availability. That committee has spent the interim reviewing different factors in the price of a home. The committee’s work included several visits to housing complexes in communities across the state, input from municipalities, and significant testimony from builders’ associations and Realtors about local government housing fees and “red tape” they believe is preventing more affordable units. Local units of government have been defensive of the building fees they charge which will setup a battle in the Legislature with home builders.
Section 179 and farmers
Many Senators have been hearing about a “farmer penalty” related to Section 179 expensing and like-kind exchanges. Senate Republicans have promised to address the issue this session and some are pointing fingers at Democrats for causing the problem in the first place, but the issue stems from President Trump’s Tax Cuts and Jobs Act (TCJA) and Minnesota’s failure to fully conform to federal Section 179 changes also made in that bill. The TCJA changed the treatment of like-kind exchanges – an exchange of personal property, such as farm equipment – so that any gain from such an event now must be reported as taxable income. The TCJA also increased Section 179 expensing limits, which allow the entire cost of certain equipment to be deducted in the year it’s placed in service.
The problem is that Minnesota conformed to the like-kind exchange rule and the higher Section 179 federal limits but did not change the state’s “add-back” requirement that spreads the full deduction over five years. Farmers that now must report like-kind exchange gains are experiencing higher taxable incomes without the offset of the more generous expensing rules supplied at the federal level.
This problem could be solved through full Section 179 conformity, which was recommended in all three initial tax proposals last year. The cost was $161.4 million in 2020-2021. The proposal was eliminated during closed-door negotiations for unknown reasons. However, the DFL House and governor’s proposals to close two foreign corporate tax loopholes that could have raised more than $200 million also were eliminated during those negotiations – two tax-fairness proposals that could have paid for full Section 179 conformity.
Buffer tax credits
In last year’s tax proposal, Governor Walz included a $50-per-acre property tax credit for landowners employing state-mandated buffer strips. This was a top priority of several Minnesota farm groups. The proposal was not included in the Republicans’ tax bill, and they also opposed a DFL amendment to add a similar provision to the tax bill when it was heard on the Senate floor. Expect the proposal to return this year.
Grain bin safety
Minnesota has seen several tragedies relative to grain bins and silos in the past year. The Agriculture, Rural Development, and Housing Policy Committee will likely examine ideas to further limit the risk of accidents occurring in the future. Senator Frentz will likely be authoring legislation that would allow farmers to apply for grants that to make safety improvements to their grain bins.