Minnesota Senate Republicans block $1.5 billion infrastructure borrowing bill, ask for action on taxes first

Bonding bills require a supermajority to pass.

Senate Majority Leader Mark Johnson, R-East Grand Forks, and Sen. Karin Housley, R-Stillwater, address reporters on the Senate floor Thursday, March 16, after a bonding bill failed in a floor vote.
Alex Derosier / Forum News Service

ST. PAUL — A bill to borrow $1.5 billion for public infrastructure projects failed to pass in the Minnesota Senate on Thursday, March 16, after Republicans declined to back the proposal without the Legislature first taking action on tax cuts.

It’s been more than two years since the Legislature passed a bonding bill — a major public works borrowing bill that helps fund projects like water treatment plants and roadwork across the state. Ahead of floor debate Thursday, Sen. Sandy Pappas, a St. Paul Democrat and chair of the Senate Capital Investment Committee, said communities across the state need lawmakers to act.

"Clean drinking water cannot wait for these communities. Treatment of sewage cannot wait for these communities," Pappas said, later adding: "We have the power here today to help the Monticellos, the Owatonnas, the Hibbings — cities in every corner of Minnesota — undertake the projects they desperately need."

Minnesota is just one of a dozen states that tax income on Social Security payments.

The bonding proposal is actually composed of two bills to fund projects across the state: one to borrow about $1.5 billion and a bill to use $392 million in cash from the historic $17.5 billion budget surplus. The House passed both last week.

While the cash bill only needs a simple majority to pass, borrowing requires approval of a three-fifths supermajority — something Minority Senate Republicans have been using as a bargaining chip to get Democrats to consider tax cuts. On Thursday, they attempted to amend the bill to include language eliminating the state's Social Security income tax — something at least four Senate Democrats say they support as well.


Democrats have majorities in both chambers, but they need the support of some Republicans to get bonding bills across the finish line in the Senate. The 34-33 DFL majority needed seven Republicans to join in supporting the $1.5 billion in borrowing, but the bill failed 33-32 on party lines in Thursday's vote. The cash bill didn't get a vote Thursday afternoon.

"We have an $18 billion surplus, unprecedented surplus, and we want to put $2 billion on the credit card," said Sen. Karin Housley, R-Stillwater, the lead Republican on the Capital Investment Committee. "If we get some meaningful tax relief, we absolutely will work together and get a bonding bill done."

Gov. Tim Walz and the Legislature reached an agreement last session that called for about $1.1 billion in borrowing for public works projects, as well as a framework that would have eliminated the Social Security income tax. But none of it got passed in a session marked by gridlock between the Democratic-Farmer-Labor governor and House and the Republican-majority Senate.

Ahead of the Senate bonding vote Thursday, Walz called on GOP senators to support the proposal and asked why they didn't go forward with the deal from last spring.

"If Republicans wanted a tax cut, take the deal last May," Walz said. "I am not here to comfort your wounds for walking away from a deal you liked."

It was a different story last week in the House, where Republicans joined Democrats in backing the bonding and spending proposals. Much of the borrowing in the bonding bill is for statewide agency projects, such as for colleges, housing and corrections.

More than $245 million is specifically marked for transportation projects including local road improvement and bridge replacement programs. Close to $180 million in borrowing is marked for Minnesota State Colleges and Universities. About $90 million in bonds and $185 million in cash for local projects is split between Democrats and Republicans.

Members of the House approved the $1.5 billion in borrowing 91-43. The direct spending passed 98-36. But without approval from the Senate, the bill can not reach the governor's desk. For now, it has been tabled by Senate Democrats, who could bring the bonding bill back later in the session.


House Speaker Melissa Hortman said last week that if Republicans don't cooperate on bonding, Democrats could advance a "with-or-without-you" infrastructure bill that uses cash only to fund projects. That bill would only require a simple majority to pass.

Follow Alex Derosier on Twitter @xanderosier or email .

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Alex Derosier covers Minnesota breaking news and state government for Forum News Service.
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