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Walz urges compromise, sets priorities for Minnesota's $9.25 billion surplus in State of the State address

The governor urged lawmakers in the divided Statehouse to work together to quickly send out hero checks to front-line workers and refill the state's unemployment trust fund.

Gov. Tim Walz State of State
Minnesota Gov. Tim Walz on Sunday, April 24, 2022, delivers his State of the State address to lawmakers and guests in the Minnesota House of Representatives.
Dana Ferguson / Forum News Service
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ST. PAUL — Minnesota Gov. Tim Walz on Sunday, April 24, urged Minnesota lawmakers to use the state's $9.25 billion budget surplus to help the state rebuild from the pandemic and set itself up for a successful future.

During the nearly one-hour address, the first-term governor said the state was moving toward recovery after COVID-19. But he said lawmakers need to step in during the last month of the legislative session to offer support to those who've borne the brunt of its impact.

Walz pointed to a nurse who'd worked on a COVID unit, business owners hit hard by the pandemic and the state's efforts to curb it, and other caregivers in the House gallery as he made the case for those spending priorities.

He also urged legislators to again bridge the partisan divide in St. Paul to get things done.

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“We may not agree on everything. Some of us won’t agree on anything,” Walz told the chamber. “We owe it to the people of Minnesota to try and find common ground.”

The speech was Walz's fourth State of the State address since taking office in 2019 and the second to occur in person at the Capitol. Walz noted that in 2020 delivered his speech remotely from the governor's residence and in 2021 from a Mankato high school due to the COVID-19 pandemic.

And the return to the Capitol marked the positive step back toward normalcy coming out of the pandemic, Walz said.

“Our budget reserves have hit a record high, and our COVID infections and hospitalizations have hit record lows," Walz said in the generally optimistic speech.

Among Walz's top requests were rapid action to get hero checks out to front-line workers and a deal to refill the state's jobless fund. Without a top-off, businesses are set to see a payroll tax hike due this week. Both proposals have been stalled due to an impasse among legislative leaders at the Capitol.

“Coming out of the pandemic, there are urgent issues that we can’t put off and we need to address quickly,” Walz said. “If we’re getting close to a compromise on this, let’s finish this issue, let’s finish it now."

He also asked that they approve $500 checks for Minnesotans that make less than a certain income threshold. The direct payments could help Minnesotans afford the things they need and also boost the economy, he said.

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Republicans in the Senate have proposed permanent income tax cuts and an end to the tax on social security, while Democrats in the House put forward a series of tax credits for families, homeowners, renters and those with student loan debt rather than a one-time check.

Democrats loudly applauded Walz's proposals and after the speech said his message highlighted the struggles that Minnesota faced during COVID, as well as a path forward. Meanwhile, Republicans said they appreciate the governor's mentions of bipartisan achievements at the Capitol, but felt his spending plans didn't send enough to Minnesotans and wouldn't address public safety issues or achievement gaps in schools.

"We're not changing the achievement gap, we're not changing much of anything and yet we're putting in new money," Sen. Gary Dahms, R-Redwood Falls, said. "We have a $9.3 billion surplus, it's pretty hard for anyone to look me in the eye and tell me we're not overtaxing the population."

Walz also asked that lawmakers prioritize state budget surplus dollars to boost funding for public safety initiatives, K-12 schools, child care programs, mental health resources and workforce development. And he proposed spending $300 million public safety issues, but with a focus on targeting the causes of crime in Minnesota.

Debates around violent crime and how to prevent it have been frequent at the Capitol over the last two and half months and Republicans and Democrats have brought forth different ideas on how to solve the problem.

The speech was more sparsely attended than in past years as dozens of lawmakers opted to join the address virtually from home using new technology adopted because of COVID-19. But lawmakers agreed that it made a difference to again hold the event at the Capitol.

“It’s great to be back in person," House Speaker Melissa Hortman, DFL-Brooklyn Park, told reporters, "with divided government, we do the best we can to compromise and we’re looking forward to another session full of compromise and productivity."

MORE FROM DANA FERGUSON:
Several incumbent state legislators, particularly in the Senate, edged out competitors with more extreme views on COVID-19, election security and more.

Follow Dana Ferguson on Twitter  @bydanaferguson , call 651-290-0707 or email  dferguson@forumcomm.com.

Dana Ferguson is a Minnesota Capitol Correspondent for Forum News Service. Ferguson has covered state government and political stories since she joined the news service in 2018, reporting on the state's response to the COVID-19 pandemic, the divided Statehouse and the 2020 election.
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