Minnesota Legislative Update: An Unprecedented State of the State

Faegre Drinker Biddle & Reath LLP

The COVID-19 response remains the sole focus of state government. The Walz administration issued new executive orders addressing health care and economic consequences of the pandemic, providing further guidance on the state’s stay at home executive order, and working to increase hospital capacity in preparation for the expected surge of COVID-19 cases later this month. The state also launched a new website related to COVID-19, which total over 1,000 cases, providing information about the number and status of cases of the virus and the state’s response. On Sunday night Governor Walz delivered an unprecedented State of the State address from the Governor’s Residence.

The legislature continued to implement remote working practices and establish a process for committee hearings and public input regarding further consideration of legislation during the 2020 session. The House began holding select committee hearings, while the Senate established a COVID-19 working group. The Senate working group’s first meeting was on Monday. The House and the Senate are working to provide transparency and public participation into the legislative process while working remotely.

Late last week, Minnesota Health Plans agreed to waive COVID-19 related expenses. Department of Commerce Commissioner Steve Kelly stated this will be in effect until at least May 31.

Governor Walz Delivers State of the State

Governor Walz delivered the State of the State address from the Governor’s Residence on Sunday, April 5. This address has always been given before a joint session of the legislature. Because the COVID-19 outbreak made that impossible to do safely, Governor Walz gave the address to the state via radio and social media instead. The 12-minute address focused solely on Minnesota’s response to the COVID-19 outbreak. Instead of advancing policy objectives, the address focused on themes of hope and perseverance. The address shared stories of communities helping one another during the challenges posed by the outbreak and highlighted Minnesota companies leading in the production of COVID-19 products, including masks, other PPE and ventilators. The address can be heard here.

State Budget Uncertainty

On Monday Minnesota Department of Management and Budget (MMB) Commissioner Myron Frans and State Economist Dr. Laura Kalambokidis testified before the Senate COVID-19 working group regarding the budget challenges Minnesota now faces. Prior to the outbreak Minnesota was projected to have a $1.513 billion budget surplus for the remainder of this biennium and structural balance in the next biennium.

Their testimony made clear that the surplus forecasted in February is not likely to materialize. State expenditures will increase significantly, as the Governor and legislature continue responding to the COVID-19 outbreak. In contrast, state revenues are expected to continue deteriorating. Currently over 340,000 Minnesotans have applied for unemployment benefits and the State Economist now predicts a 5.4% GDP decline for the remainder of 2020 with no positive growth until early 2021.

The size of any deficit in this biennium and the next is currently difficult to project. Revenue forecasts are based upon income and business tax receipts received by the state. However, the Department of Revenue (DOR) delayed March sales tax payments until April 20 and individual income tax filing and payments have been extended to July 15, making it difficult to present real-time data now. In addition, the Commissioner testified that while the CARES Act will provide an anticipated $2.2 billion to the state and local governments, the exact amounts the state will actually receive are not yet known.

Further information will be available when MMB releases the quarterly revenue report, which is expected to be released on Friday, April 10.

Agreement on COVID-19 First Responders’ Workers Compensation Coverage

After three weeks of negotiation and discussion, legislative leaders reached an agreement ensuring workers compensation coverage for first responders and health care professionals who contract COVID-19 during the course and scope of their employment. The agreement provides that first responders, peace officers, firefighters and nurses with a lab confirmed case of COVID-19 are presumed to have an occupational disease and are eligible to claim workers compensation. Workers compensation claims related to COVID-19 may be rebutted if the employer or insurer demonstrates that employment was not a direct cause of contracting the disease.

Legislation enacting the agreement was passed by the House and Senate on Tuesday, April 7, 2020.

Legislature Works to Implement Transparency in Remote Work

Following concern over a lack of transparency while developing legislation responding to COVID-19, both the House and Senate amended their rules and took further action to ensure more transparency with respect to working group activity and other discussions.

Prior to recessing on March 26, the House of Representatives agreed to amend House Rules (Full House Rules: Temporary Rules of the House, and Rule 10.01). These rules allow floor and committee procedures related to member debate and voting to occur through distance voting, remote electronic voting, or voting by other means to allow legislative operations. The amended rules are only in place for the length of the peacetime emergency and require committee meetings held by other means to allow for public testimony.

On April 1, the House Rules Committee was the first House Committee to meet remotely. The chair of the Rules Committee, Rep. Ryan Winkler (DFL- Golden Valley), noted that this hearing would test the capability to hold remote committees in the future. A few House committees met this week to discuss COVID-19 response legislation.

The Senate amended their Rules for floor procedures only to be done remotely. (Full Senate Rules: Temporary Rules of the Senate, and Rules 40.7-40.8). The Senate has announced a COVID-19 Response Working Group, which is unable to take any official action but is meeting daily to discuss impacts of the pandemic. The Senate has held virtual working groups to hear testimony regarding the impacts of COVID-19 on hospitals, the state economy and long-term care.

Tuesday, the Senate amended the Temporary Rules of the Senate to allow committee hearings to be held remotely/digitally throughout the duration of the peacetime emergency.

Governor Expected to Extend Stay at Home Order

The “Stay at Home” executive order issued by Governor Walz currently expires on April 10, 2020. During an April 2 press conference, the Governor suggested that this order will likely be extended until the end of the month. However, expanding the exemptions remains a possibility and easing restrictions for a number of industries and activities, such as golfing and professional lawncare, have been discussed.

The Governor has also suggested that his executive order closing brick and mortar schools in Minnesota will likely be extended through the remainder of the school year. Final decisions on these extensions is expected early this week.

Full List of Emergency Executive Orders in Minnesota

On Monday, Governor Walz announced Executive Order 20-28 and Executive Order 20-29. Executive Order 20-28 allows out of state mental health practitioners to provide aid in Minnesota. Executive Order 20-29 expedites access to Minnesota’s Unemployment Insurance program for workers that are receiving vacation pay, sick pay, or personal time off. Executive Order 20-29 also makes technical changes to allow the Minnesota unemployment insurance program to administer payment increases authorizes by the federal CARES Act.

In total, Governor Walz has now issued 29 executive orders in response to the COVID-19 outbreak:

Important Dates

  • March 27- April 14: Legislative Recess (with option for reconvening as needed)
  • May 15-16: GOP State Convention
  • May 18: Legislature Adjourns
  • May 30-31: DFL State Convention
  • June 2: Candidate Filing Deadline for 2020 Election
  • August 11: Primary Election Day
  • November 3: Election Day

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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