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Transportation, housing and labor package passes House

(House Photography file photo)
(House Photography file photo)

Proponents of the transportation, labor and housing supplemental budget bill say it will result in a safer, cleaner, more affordable state with provisions that would mitigate the effects of greenhouse gas emissions, provide more protection to workers and expand opportunities for home ownership.

Sponsored by Rep. Frank Hornstein (DFL-Mpls) HF5242, as amended, was passed 69-60 late Wednesday and sent to the Senate.

The bill contains the supplemental budget bills for transportation, labor and housing that were merged in the House Ways and Means Committee last week.

It also has a controversial employment provision that would discourage misclassification of employees as independent contractors.

Opponents, however, say the bill offers only misguided budget priorities and regulations that would distort the market, restrict options and cause unnecessary delays and expense to critical housing, transportation and broadband projects. 

Minnesota House debates HF5242, the transportation, labor & housing supplemental finance bill 5/1/24

“It’s going to be one heck of a conference committee,” said Rep. John Petersburg (R-Waseca).


Any transportation bill should include a multimodal approach, create jobs, improve safety and address greenhouse gases emitted through the transportation system, Hornstein said.

The bill calls for $78.8 million in spending from the trunk highway fund with $40 million going to improve high-priority bridges. Other appropriations would go to plant trees along the highway, model greenhouse gas emissions related to transportation, improve a truck rest stop near St. Cloud and install rumble strips at more intersections.

It would also provide nearly $3 million from the Driver and Vehicle Services account to hire approximately 32 more testers for drivers’ licenses exams. Earlier this session, legislators recounted stories of families spending hours trying to get an appointment online and even more hours traveling to an available testing site.

There would also be funding for an intensive testing program for people convicted of driving under the influence of substances other than alcohol, and for a program that would allow law enforcement officers to offer coupons to get headlights repaired instead of issuing a traffic ticket for faulty lights.

[MORE: View the spreadsheet]

One sticking point for Republicans is provisions to help implement a greenhouse gas mitigation plan, saying it could kill projects that would increase safety or reduce congestion. However, Rep. Larry Kraft (DFL-St. Louis Park) rejects the notion that safety and greenhouse gas mitigation is an either/or proposition.

Several Republicans objected to new regulations on railroad operations, including some that would limit the size of trains to 8,500 feet, require additional wayside detectors and limit hours worked by yardmasters. Among their objections is any possible preemption of federal law and higher costs, especially in the agriculture and mining industries which rely on freight trains.

Additionally, Republicans unsuccessfully offered amendments that would redirect money from trains to other projects, including one that would have sent $150 million more to the Corridors of Commerce program instead of funding passenger rail between the Twin Cities and Duluth, and another that would redirect money planned for an extension of the light rail to hospitals in Maple Grove and Robbinsdale.

Labor and industry

Included in the bill is the contents of HF4444, as amended, that would impose hefty fines on employers who misclassify employees as independent contractors.

The bill was scheduled on the floor Monday (and 14 amendments were lined up to be offered) but was tabled due to time constraints. Republicans pushed for it to be heard separately instead of being added in an all-encompassing bill.

Supporters say misclassification fraud is a growing issue where some employers cheat the system by labeling legitimate employees as independent contractors to cut costs on the backs of workers. Incorrectly classifying legitimate employees means employers avoid costs like employment tax, providing benefits, and paying overtime wages.

“Workers being fairly treated, compensated, and valued should never be up for debate, and today we took major steps to halt mistreatment and fraudulent workplace practices,” Rep. Michael Nelson (DFL-Brooklyn Park), chair of the House Labor Committee, said in a statement.

Labor and industry provisions in the bill would appropriate more than $9.57 million from the General Fund in fiscal year 2025.

The bulk of the spending — $9 million — would go to Tending the Soil to help construct the Rise Up Center in Minneapolis. Located in a former YWCA, it would be a workforce development hub serving and training about 3,000 workers annually.

Rep. Isaac Schultz (R-Elmdale Township) unsuccessfully offered an amendment that would only allot $1.7 million to cover the project’s broadband implementation.

[MORE: View the spreadsheet]

A provision encouraging construction codes to move toward achieving a 70 percent reduction in annual net energy consumption by 2038 compared to 2006 drew much discussion, with Republicans arguing it would price too many people out of owning a home.

An article to allow University of Minnesota employees – including student employees – more flexibility in organizing collective bargaining units removed by an amendment.  


Housing provisions in the bill come from HF4194, which was approved by the House Housing Finance and Policy Committee April 17.

Rep. Michael Howard (DFL-Richfield), chair of the committee and sponsor of the bill, previously said it is targeted at making the biggest impact for Minnesotans most in need.

It would appropriate $10 million from the General Fund, of which $8.89 million would go to the Family Homelessness Prevention and Assistance Program, with $943,000 of this allocated to federally recognized tribes in Minnesota.

[MORE: View the spreadsheet]

The bill would also add to permitted uses of housing infrastructure bonds including:

  • recapitalization of supportive housing where at least 50% of the units are reserved for individuals and families without a permanent residence;
  • acquisition and rehabilitation of foreclosed or abandoned housing to be used for affordable home ownership;
  • recapitalization of a distressed building; and
  • development of cooperatively owned housing affordable to low- and moderate-income households.

"Today, Minnesota took a significant step forward in ensuring housing stability and opportunity for all," Rep. Esther Agbaje (DFL-Mpls) said in a statement.

Several members of the housing committee expressed concern this session about power afforded homeowners’ associations; the bill would appropriate $200,000 for a working group to study the issue.

Among policy provisions in the bill is one tying rent increases for some low-income seniors to increases in Social Security or Supplemental Security Income as opposed to using area median income.

Another would allow housing and redevelopment authorities to create a public corporation to purchase and operate housing projects converted through the federal Rental Assistance Demonstration program.

Rep. Andrew Myers (R-Tonka Bay) successfully offered an amendment requiring a report to the Legislature on any proposed recommendation developed about verification procedures for emergency rental assistance.

Session Daily writers Brian Basham and Miranda Bryant contributed to this story.

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