Legislative Update - May 21, 2025

Publish Date
Committees
Political Council

The bizarre 2025 regular legislative session officially ended and there is still a lot of work remaining to avoid a government shutdown. Work continues as committees that did not finish their bills, now converted into workgroups, scramble to complete their bills before 5 p.m. today, when what’s left gets handed over to leadership to negotiate. Then, Gov. Walz will call the special session, but he cannot adjourn, so the special session will continue until an agreement.

Session was mired with numerous election contests, vacancies, a constitutional crisis and a looming $6 billion deficit likely to be made worse by an unpredictable and unstable federal government.  

Here is what has passed so far: 

  • Veterans and Military Affairs Finance  

    • Funds the operating adjustments for Military Affairs and Veterans Affairs 
       

  • Agriculture Finance  

    • Funds the operating adjustments for Dept. of Agriculture, Board of Animal Health and Office of Broadband Development 
       

  • Legacy  

    • Includes funding for numerous arts and environmental projects overseen by state agencies  

    • Funds certain programming at the MN Zoo 
       

  • Judiciary and Public Safety Finance and Policy 

    • Includes operating adjustments for the Dept. of Corrections, Dept. of Public Safety and the Dept. of Human Rights 

    • Transfers the Dept. of Commerce’s Fraud Bureau to the Bureau of Criminal Apprehension 

    • Protects personal information of Human Services Appeals Division judges similar to administrative law judges 

    • Includes the phased closure of Stillwater-MCF 
       

  • Omnibus Pension Bill 

    • Includes increasing the MSRS General Plan service credit multiplier from 1.7 to 1.9 percent, increasing the post-retirement cost of living adjustment from 1.5 to 1.75 percent  

    • Creates an interim taskforce to form an early retirement plan for corrections agents 

    • UI for Hourly School Workers 

    • Bill funds unemployment insurance for paraprofessionals and other staff in schools  
       

  • Housing Finance  
     

  • Human Services Policy 

    • DCT will continue to be led by an Executive Board and Chief Executive Officer instead of by a Commissioner 

    • Provision requiring that patients must be admitted to a state-operated facility within 48 hours of a medically appropriate bed becoming available extended to June 30, 2027 

    • After June 30, 2027, patients must be admitted to a state-operated treatment program within 48 hours (with no exception for beds available). 

  • Cannabis Policy Omnibus 

  • State and Local Government Policy and Finance 

    • Operating adjustments for the agencies, boards and constitutional offices 

    • Allow an agency to withhold payments to a program participant for up to 60 days if there is a preponderance of evidence the participant has committed fraud to obtain payments 

    • Expand the scope of existing whistleblower protections for state employees 

    • Establish a retained savings program to encourage state agencies to innovate and identify efficiencies and cost savings 

    • Allow the Office of the Secretary of State to assess an up to $40 late penalty when a person files for renewal or reinstatement of business entity that was administratively dissolved. 

Bills outstanding include: 

  • HF2442/SF2393 Energy, Utilities, Environment & Climate policy and finance 

  • SF1832/HF2440 Workforce, labor, & economic development finance bill 

  • SF2216/HF2443 Commerce & Consumer Protections policy and finance 

  • HF2435/SF2669 Omnibus Health and Human Services policy and appropriations

The Higher Education conference committee had actually finished its work, but Rep. Marion Rarick refused to sign the conference committee report unless Governor Walz agreed to hold the University of Minnesota Board of Regents election convention during special session. A tax bill and bonding bill have also not made an appearance yet, nor has the education finance bill passed both chambers. 

Leaders also reached agreement on the more contentious policy issues on Thursday. There will be no change to the Earned Sick and Safe Time law. Paid Family Medical Leave will have a 1.1 percent premium cap, and leadership agreed to end MinnesotaCare coverage for undocumented adult Minnesotans by the end of 2025. Whether all of those items will hold up in these new negotiations is unknown. 

Other updates 

The U.S. House budget committee advanced their proposed spending package. This area will have devasting consequences for Minnesota, as items for consideration have numerous cancellations of climate resiliency standards and grants and significant Medicaid restructures. Proposals on Medicaid cuts include: 

  • Implementing work requirements 

  • More frequent eligibility checks for both recipients and providers 

  • Moratorium on rule change for Basic Health Plan, CHIP, and Medicaid enrollment 

  • Reducing Federal Medical Assistance Percentage (FMAP) by ten percent for states that provide any medical coverage to undocumented individuals 

  • Cutting retroactive coverage from three months to one 

  • Requiring co-payments for individuals covered under expanded coverage above the federal poverty level 

  • Prohibiting Medicaid payments to be paid to nonprofit providers, essential community providers and their affiliates primarily engaged in family planning services, reproductive services, or provide abortion services not currently exempted under the Hyde Amendment 

  • Blocking any state from increasing the provider tax 

  • Disqualifying gender care and transition services from Medicaid and the Affordable Care Act 

The proposal in total would cut Medicaid spending by $715 billion over ten years and result in more than 10 million people losing their health insurance coverage by 2034. Medicaid is the largest provider of health insurance for Minnesotans, covering roughly 20 percent of the population. Proposed increase to states cost sharing percentages for SNAP benefits could cost Minnesota over $200 million annually. The House reconciliation process is expected to conclude before Memorial Day, after which the Senate will take it up for consideration.