Skip to main content Skip to office menu Skip to footer
Capital IconMinnesota Legislature

Notes from the House, incl. big tax increase despite massive state surplus

Monday, March 21, 2022

Dear Neighbor,

Here is a look at some of the latest notes from the House:

House Democrats cause tax increase despite historic surplus

House Democrats are forcing a massive tax increase on job creators that will ultimately impact all of us at a time the state has a nearly $10 billion surplus and Minnesotans already are struggling with historic inflationary price increases under Biden-Walz.

House Democrats blocked a last-ditch Republican effort recently to vote on bipartisan Senate legislation that could have prevented this tax increase from taking place. It was the second time in less than a week the majority voted to not bring this bill up for a vote.

The issue surrounds the state’s unemployment insurance trust fund that was depleted with more people out of work during the pandemic. The federal government provided funding to the state to keep the program afloat and now that debt of more than $1 billion is due.

This tax hike will impact us all

Members of the House majority continue to downplay the impacts of their inaction on this issue, but real-life reports indicate the tax increases could be significant. One recent article quotes Greater Minnesota employers saying they face tax increases in the tens of thousands of dollars next year. In one reported case, a 130% increase translates to a $21,000 spike.

This might formally be a tax on employers but, let's be real, it's going to cost us all more at a time we already are paying higher prices in the current economy. I just don’t know how House Democrats can ignore the consequences their lack of action is going to mean for Minnesotans. This should be a time we are pulling out all stops to get our economy going and to help people get back on their feet after losing income during the pandemic. Instead, House Democrats are just adding to the burden and making it more difficult to recover.

House majority on an unemployment issue island

Gov. Tim Walz, House Republicans, Senate Republicans, and most Senate Democrats support passing a clean bill to fully replenish the UI funds. The Senate one month ago approved by a veto-proof majority legislation to do so.

But House Democrats continued to withhold that bill through the March 15 deadline. Their own UI bill, which the Minnesota Department of Employment and Economic Development testified would result in six years of tax increases on businesses, has been stagnant since early February.

Now, a tax increase is set to take place to pay the state’s federal debt despite the fact Minnesota has a surplus of around $10 billion. House Democrats spent a lot of time on the House floor Monday making excuses for why they didn’t want to fix this problem but none of that is going to matter to Minnesotans. Minnesotans are going to know House Democrats are responsible for a tax increase at a time the state has a historic surplus and that’s not going to sit well with people.

'Your Legislators' TV show appearance

I was pleased to be invited to participate in a recent episode of the Your Legislators show broadcast live throughout the state on Pioneer public television. We discussed everything from the aforementioned unemployment insurance issue to local infrastructure projects, frontline worker compensation and more. Click here to see the show.

Auditing Southwest Light Rail

Construction costs for the Southwest Light Rail line in the metro now have nearly tripled from just over $1 billion to more than $2.75 billion over the last decade. Meanwhile, the Met Council is pushing hundreds of millions of dollars in new light rail spending. The House recently approved legislation to conduct a thorough, non-partisan audit of this project so further legislative action can be taken as appropriate.

Please reach out if I can be helpful, or if you have input or questions on legislation being debated at the State Capitol.