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Legislative News and Views - Rep. Paul Anderson (R)

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Legislative update

Thursday, May 5, 2022

Dear Neighbor,

With a hard deadline approaching, the Legislature recently passed and the governor signed into law a bill that fully replenishes the state’s Unemployment Insurance Trust Fund.

In addition, the Hero Worker Pay Bill was passed at the same time, and it provides $500 million in one-time payments to frontline workers in Minnesota. It was a somewhat rocky road, but compromise and hard work led to the agreement that lowers the unemployment tax rate on all businesses in the state.

Because of all the shutdowns during the pandemic, applications for unemployment benefits increased greatly. The fund that pays those benefits actually went into a deficit situation and had to borrow money from the federal government to stay afloat. The deficit was around $1 billion and the interest payment to the feds was somewhere in the neighborhood of $60,000 per day!

Businesses were facing up to a five-fold increase in the rate they pay into the fund. Now, with the fund replenished, the base rate will revert to its original amount. The higher rate actually went into effect back in January but the payments were not due until last week. Those who have already paid their first quarter premium at the higher rate will get either a refund or a credit back from the state.

Minnesota has about 130,000 employers, and they will all need to have their first quarter UI tax amount recalculated. Letters will be sent out to businesses once that recalculation has been completed. Refunds are not going to be automatic, and those businesses requesting refunds may not see them for several months, depending on the volume of processing. Click here for details on the changes in law.

You also can visit www.frontlinepay.mn.gov for information on frontline worker pay eligibility and more.

Watch for more from the House as we now enter the thick of negotiations ahead of the May 23 deadline to adjourn. The House majority has now finished moving its major omnibus bills through the floor on initial passage and conference committees will assemble to reconcile differences in bills the House and Senate propose.

It could be quite challenging to find agreement on supplemental budget issues since the spending amounts and policy items in the House and Senate versions are, in some cases, vastly different. Senate Republicans passed an $8 billion tax cut, while House Democrats are looking to spend $21 for every $1 in cuts they propose.

On a quick side note, the drought aid bill for farmers that was approved by the House almost two months ago is still being held up by the House DFL's insistence on including money for the DNR's tree planting. Enactment of this much-needed relief is long overdue and I hope we wrap this up soon.

We will see how things unfold over the next couple of weeks and, as always, your input is appreciated.

Sincerely,

Paul