The second special session of 2020 kicked off this week with a renewed focus on bonding. On Monday, the House unveiled a $1.35 billion bonding bill that was combined with a tax bill. This morning, the House Ways and Means Committee voted on a party-line basis to advance the bill. It will now head to the House floor. You can see text of the bill here and a spreadsheet of included projects here.
In addition to individual projects in many CGMC member cities, the bill includes funding for several CGMC priorities:
- $254 million for the Public Facilities Authority for water infrastructure grant and loan programs
- $230 million for local roads and bridges (including $70 million for the local road grant program and $30 million for the local bridge grant program)
- $100M for housing infrastructure bonds
- $10 million for the Greater Minnesota Business Development Public Infrastructure (BDPI) grant program
Unfortunately, CGMC priorities that did not make it into the bill include funding for child care facilities and a new grant program to fund public infrastructure for housing.
This bonding bill is tied to the tax bill. According to this tweet from a Fox 9 reporter, House Speaker Melissa Hortman (DFL-Brooklyn Park) said the two bills were combined because neither one would be able to secure enough votes on its own. The tax portion contains approximately $99 million in tax relief, most of which comes from the adoption of full conformity of Section 179 expensing, a change that will benefit many businesses across the state. The bill also makes the student loan credit refundable and creates an account to promote home ownership for low-income individuals.
During the Ways & Means Committee hearing, Minnesota Management and Budget (MMB) Commissioner Myron Frans testified in favor of passing a bonding bill quickly. He mentioned that the Legislature needs to pass a bonding bill by July 20 so that MMB can proceed with the traditional August bond sale.
Both the chair and minority lead for the House Transportation Committee expressed concern about $300 million in trunk highway bonds contained in the bill and the impact that large of an amount could have on the future balance of the trunk highway account. They noted that there are already concerns about the trunk highway account given the impact of COVID-19 and the significant trunk highway bonding the Legislature has done in recent years.
During the debate, Rep. Pat Garofalo (R-Farmington), who serves as minority lead on the Ways & Means Committee, said the House GOP would not provide enough votes to pass the bill because they had been excluded from final negotiations over the weekend. The bill passed out of the committee, but all GOP committee members voted against it.
House Minority Leader Kurt Daudt (R-Crown) has also frequently referenced another hurdle in securing enough GOP votes to pass the bill in the House — continued frustration over Gov. Walz’s peacetime emergency orders. Daudt and several other GOP House members contend they will not support a bonding bill unless the Governor ends his emergency order related to the COVID-19 pandemic.
Another potential challenge in passing the bonding bill comes from some members of the POCI (People of Color and Indigenous) caucus, who have indicated they are unwilling to vote for a bonding bill unless there is substantial progress on criminal justice reform.
On Friday, CGMC issued a statement to the media calling on legislators to pass a bonding bill during this special session. We continue to work with legislators from both sides of the aisle and urge them to pass a bill as soon as possible to help create jobs and boost the economy. Stay tuned …