Special legislative session off the table, billions of dollars left unspent by the state

Talks of a special session collapsed Thursday as Gov. Walz and legislative leaders failed to reach an agreement, despite a multi-billion dollar surplus.

“I could see a lot of Minnesotans just being disgusted. It’s politics as usual,” said Larry Jacobs, professor of politics at the University of Minnesota’s Humphrey School of Public Affairs.

Jacobs said Republicans and Democrats had reached an ‘agreement in principle’ last month for how to appropriate the remaining money in the budget surplus, with $4 billion used to cut taxes and a plan to spend billions more on health care, education, and public safety.

“It was very ambitious and it looked like a good compromise between democrats and republicans. Today, nothing’s happening,” Jacobs said.

He noted the impasse is likely due to the upcoming election.

“We are five months from Election Day and we are seeing both parties angling. For Republicans, they do not want to hand Gov. Walz a victory where he can hold up spending and the tax cuts as the result of his bipartisan work. They don’t want to allow him to go around the state talking about his leadership and his ability to create bipartisan deals,” Jacobs said. “And the DFL wanted to see more spending on health care and education, as well as money going to infrastructure, which would be job-creating for unions around the state.”

The surplus money that could have been appropriated by the state government would trickle down to local governments.

“Billions of dollars sitting on a shelf not doing anyone any good is a huge disappointment. Quite honestly, it’s a shame,” said Trista MatisCastillo, chair of the Ramsey County Board of Commissioners.

MatisCastillo said Ramsey County had hoped for millions of dollars in extra funds, to help increase capacity at homeless shelters and provide youth intervention programs to prevent crime.

“It’s really frustrating. We elect a government body because we have expectations as a community to do that work,” MatisCastillo said. “We really do need the legislature to step up and do what they were elected to do.”

While the possibility of a special session remains, Jacobs said it is unlikely.

“I’d be surprised if the governor and republicans came back together with a deal. They’ve been working at this for more than a month and nothing’s happened,” Jacobs said.

If a special session does not happen, how to use the budget surplus will be up to lawmakers next session, after the November election.

“If you’re looking for a silver lining, I suppose you could say by the time legislature comes back in session with a new house and senate, there will be quite a bit of money and we could be in a recession, so that money could be used in quite helpful ways,” Jacobs said.