 Dear Neighbor, New federal tax policy could be a great benefit for fiscally challenged Minnesota schools, without raising our taxes one single penny. Education funding House Republicans have introduced legislation (H.F. 3490) that would opt Minnesota into a federal tax credit program ensuring Minnesota taxpayer dollars benefit Minnesota schools and Minnesota students. Participation in this program would cost Minnesota nothing. A number of states have already opted in including North Dakota, South Dakota, and Iowa, as well as blue states like Virginia and Colorado. The funds could be used to support tutoring, extracurricular activities, and services for students with special needs. They could also help schools address learning loss, provide classroom supplies that teachers often purchase out of pocket, and expand educational opportunities for students across the state. During a press conference, House members highlighted the scale of funding that could be generated through this program. Minnesota has approximately three million taxpayers. If each taxpayer took advantage of the $1,700 federal tax credit, the potential contributions could total roughly $5 billion. Of course, not every taxpayer would participate, but even if only half chose to take advantage of the credit, it could still represent approximately $2.5 billion in additional support for education. If Minnesota does not opt into the program, taxpayers could choose to direct those contributions to schools in other states, including nearby states such as Iowa and the Dakotas. Because some misinformation has circulated about this proposal, it is important to clarify what the bill does not do. First, this House bill does not create a state tax credit program; that program already exists under federal law. The bill also does not authorize Minnesota taxpayers to donate to scholarship-granting organizations; Minnesotans already have that ability under existing federal law. This legislation simply allows Minnesota schools and students to benefit from a program that is already available. While the Legislature could act to pass this bill, the governor also has the authority to opt Minnesota into the program directly. Ultimately, it’s a rather straightforward question: Should our Minnesota taxpayer dollars support Minnesota students? Affordability in MN Affordability remains a major issue during this legislative session, particularly at a time when state spending has increased at a rate that far exceeds the growth in most individual incomes.  Families across Minnesota are feeling the strain as the cost of groceries, childcare, housing, insurance, energy, and other everyday necessities continues to rise. In addition to these visible expenses, there are also less obvious costs such as new delivery fees, a new payroll tax, and unfunded mandates placed on local governments that ultimately result in higher costs for taxpayers. House Republicans are focused on reversing policies that have contributed to rising costs and on pursuing measures that will make Minnesota a more affordable place to live, work, and raise a family. - Lower/keep health insurance costs low via permanent reinsurance (H.F. 3388)
- Create a direct primary care healthcare program (H.F. 1724)
- Require cost defrayal for new healthcare mandates (H.F. 400)
- Property tax commission to lower property taxes (H.F. 3396)
- No tax on tips or overtime (H.F. 3524, H.F. 3525)
- Repeal the retail delivery fee, ending the tax on Social Security income, and removing the automatic gas tax increases that were approved by Democrats last session. (H.F. 5)
- Lower boat registration fees (H.F. 3669)
- Lower vehicle tab fees (H.F. 3562)
- Return a portion of future surpluses back to taxpayers (H.F. 4)
- Lower property taxes by allowing schools to opt out of certain unfunded mandates from the state (H.F. 957)
- Lower property taxes by allowing local government noncompliance of unfunded mandates (H.F. 1593)
Rather than addressing these concerns or working to correct past policy decisions, some Democrats are even talking about “quintupling” vehicle tab fees. Even raising such an idea highlights a troubling disconnect from the financial pressures currently facing Minnesota families. Higher education The House Higher Education Finance and Policy Committee on Thursday, March 12, heard two bills that take distinctly different approaches to our state’s higher education policy. House Democrats have introduced a bill (H.F. 3432) that would extend in-state tuition eligibility at Minnesota State colleges and universities to individuals who have just accepted full-time employment in the state, but do not meet the residency requirement. The proposal also encourages the University of Minnesota to adopt a similar policy. For context, U.S. News & World Report indicates in-state tuition at the University of Minnesota Twin Cities is approximately $18,482 per year, compared with $41,368 for out-of-state students. Under current law, in-state tuition is available to dependent students who attend a Minnesota high school for at least three years and graduate from a Minnesota high school. During the committee hearing, several concerns were raised regarding potential cost shifts and questions of residency fairness. Some legislators questioned whether individuals who have recently moved to Minnesota should receive the same tuition rates as families who have lived, worked, and paid taxes in the state for many years. I also noted the potential impact on institutional budgets, as well as the possibility that families could move to Minnesota, have one parent obtain short-term employment to qualify their children for in-state tuition, and then leave the state, since the bill does not specify any requirements regarding the type or duration of employment. That same day, we heard a bill H.F. 1323 which prioritizes citizens and individuals who are here legally for all state grant dollars. The State Grant program is projected to face a $102 million shortfall in fiscal years 2026 and 2027, despite the legislature closing a similar sized gap just last session. Last spring, as Chair of the House Higher Education Finance and Policy Committee, I worked to resolve a major State Grant Program shortfall through spending reductions and policy adjustments. However, the program is again facing a massive shortfall, due in part to increased enrollment by students with significant financial need who are applying to the North Star Promise program which pays the full amount of tuition and fees for families with household incomes of $80,000 or less. The Minnesota Office of Higher Education says more than 75,000 students received approximately $222 million in Minnesota State Grants in fiscal year 2025. This included 617 students who do not have legal status, but received nearly $5 million in state grants under the Minnesota Dream Act provision. Both bills were laid over for possible inclusion in the Higher Education omnibus bill. |