Governor Walz, Legislative Leaders Reach Budget Agreement

Governor Tim Walz and legislative leaders reached a budget accord Sunday, May 19, one day prior to the mandatory date of adjournment. With many details yet to be hammered out by conference committee members and state commissioners, a special session will be required before the budget is passed and enacted.

Under the agreement, E-12 Education will receive an additional $540 million dollars, with the general education formula increased by two percent each year in Fiscal Year 2020 and 2021. Another $358 million is earmarked for health and human services, and the health care provider tax will continue at 1.8 percent. Also, the health care reinsurance program will continue for another two years, according to the agreement.

The budget agreement also includes a tax cut for the middle class with .25 percent rate reduction to the income tax second tier. However, the agreement excludes a gas tax hike.

Another $150 million dollars is designated for higher education, and $125 million additional dollars for public safety, including the hiring of more prison guards. Furthermore, $40 million additional dollars is designated for broadband.

Finally, the bill calls for $440 million dollars in General Obligation bonds and $60 million dollars for Housing Infrastructure Bonds.