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Minnesota House speaker 'optimistic' about negotiations on payroll tax, front-line worker pay

Weeks after talks at the Capitol stalled out, House Speaker Melissa Hortman said new negotiations were scheduled on plans to refill the unemployment insurance trust fund and send checks to front-line workers.

Minnesota House Speaker Melissa Hortman
Minnesota House Speaker Melissa Hortman, right, and House Majority Leader Ryan Winkler, left, speak with reporters at the Capitol on Thursday, April 21, 2022.
Dana Ferguson / Forum News Service
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ST. PAUL — Minnesota House Speaker Melissa Hortman says that Capitol negotiations are set to restart next week on payments to front-line workers and a plan to refund higher payroll taxes for employers.

The Brooklyn Park Democrat told reporters on Thursday, April 21, that leaders in the divided Statehouse could reach a deal ahead of an April 30 tax filing deadline for Minnesota businesses despite months of disagreements about the two issues.

“We’re having very good conversations with Senate Republicans at this point and I’m optimistic that we’ll be able to do something before April 30,” Hortman said.

Legislative leaders and the governor met privately on several occasions before the Legislature's recess earlier this month. But they weren't able to strike a deal that would send out checks to front-line workers who remained on the job during the pandemic and repay the state's unemployment insurance trust fund, blocking a payroll tax hike that is triggered when the fund runs dry.

In the meantime, business owners in the state have seen their payroll taxes climb by double-digits. And front-line workers have voiced frustration and fatigue after lawmakers took up bonus payments for them but never agreed on who should receive them.

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Gov. Tim Walz on Wednesday blasted legislative leaders for failing to reach a deal that could satisfy both the Democratic-Farmer-Labor-led House and Republican-controlled Senate more than two months into the legislative session. The first-term governor urged lawmakers to renew conversations and said he'd lay out a potential path forward during his State of the State address on Sunday, April 24.

Hortman said Democrats in the House were the last to post an offer before negotiations stalled. And they maintained that the state could spend less than the $2.7 billion that Republicans, Walz administration officials and the Minnesota Chamber of Commerce proposed to repay the federal government and fill the state jobless fund.

She said Democrats supported a $1.8 billion plan for that issue that would repay the feds, partially fill the unemployment fund and rewrite state law to prevent higher payroll tax rates from taking effect. House leaders have also urged the pairing of that plan with a $1 billion bill to offer $1,500 checks to roughly 667,000 front-line workers.

“We understand, of course, the importance of the unemployment insurance issue," House Majority Leader Ryan Winkler, DFL-Golden Valley, said, "but we’ve had workers waiting for a year plus for any kind of recognition from federal money for the extraordinary effort they put on on our behalf and there’s no reason we can only do UI and he can’t do anything else."

On March 28, after the last talk on the two subjects, Senate Majority Leader Jeremy Miller, R-Winona, said the offer was a step in the wrong direction and asked that lawmakers take up the unemployment insurance issue on its own. He said proposed tax cuts put forward by Senate Republicans would do more to help front-line workers in the long-term than one-time payments.

Lawmakers have until May 23 to finish their business in the regular legislative session. Walz on Wednesday said he would not call a special session if legislators failed to get their work done before the deadline.

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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