The end of the 2023-24 session was extraordinary and acrimonious, capping two years of single party control of state government; record budget surpluses and spending; a sweeping, progressive policy agenda; and unfortunately, a more partisan state Capitol than many of us have witnessed or experienced. The Legislature and governing in our state has changed in a deeply concerning way.

Greater Mankato Growth and our advocacy partners, such as the Minnesota Chamber of Commerce, have worked hard on your behalf to push important issues forward, modify or block policies that harm our state’s economy, to inform representatives and senators that costs matter, that our economy shouldn’t be taken for granted, and that private sector employers and their employees are the fuel that drives our state forward. We value what you do.

For a full breakdown of what passed and what didn’t, see the issue areas below.

Thank you for your membership and your support of our work at the Capitol. It is greatly appreciated.

Taxes
The final tax bill as passed in the final moments of session ended up being loaded up with 10 other bills. The actual tax portion of the bill was very slimmed down and did NOT include any problematic provisions of corporate tax disclosure, base erosion study or the Section 530 safe harbor removal. This mega bill of over 1,400 pages included multiple subjects of gun control, health and human services, higher education, paid family and medical leave, transportation, and others.
This bill was very controversial as it was rammed through without any debate in the very last few minutes of session and without language being available for review by legislators. The tax portions included a child tax credit, minerals article, moist snuff, and tax forfeiture language to address the U.S. Supreme Court Tyler decision. Here is a link to the tax spreadsheet and the bill language.

WHAT PASSED
Net operating loss effective date fix
GMG supported this provision to fix an error from the 2023 omnibus tax bill where the effective date was intended to be tax year 2024 but was drafted incorrectly as tax year 2023. The 2023 tax bill lowered the ability to take net operating loss from 80% to 70% which impacts many start-ups and small businesses. We opposed this change in 2023.

WHAT DID NOT PASS
Disclosure of private corporate tax returns
GMG opposed this provision carried in House tax bill that would have required the Commissioner of Revenue to disclose private tax returns for corporations having $250 million or more of U.S. sales. This would have violated the long-standing principle of taxpayer confidentiality and undermines Minnesota’s competitiveness as no other state or the federal government requires a similar public disclosure of confidential tax return information. In lieu of releasing private taxpayer data, aggregate corporate income tax data will be provided in a report to policymakers (this type of reporting is already allowed under current law).

Corporate base erosion study
GMG opposed this one-sided study carried in House tax bill requiring a study on taxation of international income including mandatory worldwide reporting.

Workplace management
WHAT PASSED
The 2024 labor policy omnibus final conference committee report
GMG and the MN Chamber opposed due to the additional costs and liabilities imposed on Minnesota’s employers – including altering the application of our existing minimum wage structure, increasing the minimum wage for a majority of the state’s businesses, particularly small businesses; prohibiting restrictive employment covenants in service contracts; additional changes to pregnancy accommodations and leave laws; and requiring employers to disclose salary ranges in job postings.

The 2024 labor supplemental budget bill.
GMG and the MN Chamber opposed due to the additional costs and liabilities imposed on Minnesota’s employers. Some notable provisions include:

• The Department of Labor and Industry’s (DLI) sick and safe time “fix it” bill. While the “fix it” bill includes some clarifications necessary to reduce confusion resulting from the interpretation of this new law uncovered during its rollout and implementation, it also includes increased compliance, rulemaking and remedies as well as expanding the scope of the mandate itself.
• The Attorney General’s Worker Misclassification bill. This bill makes several changes to misclassification provisions in Minnesota’s existing labor laws, including significant new penalties and fines as well as individual and successor liability. It also creates a multi-agency Intergovernmental Misclassification Enforcement and Education Partnership, which allows for data sharing related to misclassification investigation, outreach, prevention and enforcement. Further, it establishes a new multi-part independent contractor test for building construction and improvement services.

WHAT DID NOT PASS
Minimum Wage and Unemployment Insurance
A bill to increase the minimum wage base wage rate to $20.00/hour for all employers; a bill to provide unemployment insurance (UI) for striking workers; and a bill to create a “shadow UI system” for unemployed workers who are unauthorized to work in the United States.

Worker Misclassification
Changes to the general independent contractor tests, outside of building construction and improvement services, existing under current law. However, the AG’s Task Force on Worker Misclassification will be turning its attention to review of those tests before next session.

Paid family and medical leave
WHAT PASSED

• The Department of Employment and Economic Development’s (DEED) Paid Family and Medical Leave (PFML) “fixes” bill.
• GMG and the MN Chamber opposed due to the additional costs and liabilities imposed on Minnesota’s employers. While there are quite a few technical changes, and a few helpful adjustments, as you can expect this bill also includes a number of problematic changes as well.
• Most significantly, DEED’s “fixes” bill proposes adjusting the payroll tax rate away from the original formula and basing it on routine actuarial analyses.
• Consequently, the payroll tax rate, set in last year’s law at 0.7%, must rise to 0.88% in 2026 to accommodate their proposed changes and sustain the program, rising to at least 0.93% by 2029.
• The original actuarial analysis revealed significant discrepancies in the cost projections for the PFML program.
• The state initially allocated around $800 million for start-up costs, but actual expenses exceeded estimates by $628 million over the program’s first three years.

Energy
WHAT PASSED

• Permitting reform that is targeted at speeding the approval process for wind, solar, and transmission projects was able to pass on the final day of session. While they spent very little General Fund money on energy projects or programs, the Legislature committed to spending over $50 million in utility customer fee money on grants and programs over the next decade.
• WHAT DID NOT PASS
  Despite passing off the Senate floor, the Legislature made no progress on nuclear energy deployment in Minnesota. Neither a limited exemption to the existing nuclear moratorium or a state study on nuclear power were able to make it into law.

Environment
WHAT PASSED

• The Extended Producer Responsibility (EPR) legislation passed both the House and the Senate. This bill would require manufacturers of paper and plastic packaging to be responsible for the cost of disposal of their products.
• Add costs of $35-65 for a family of four per month on their grocery bill.
• Increased authority to MPCA, including expanded ability for cease and desist orders.
• Increased air emission reporting requirements.
• Coordinated Project Plans for economic development projects (recommendation from Chamber Foundation permitting report).

WHAT DID NOT PASS

• Container deposit/bottle bill.
• No increased tax (3.2% tax) on purchase of electronic products.
• No moratoriums on feedlots.
• No amortization of businesses without compensation.

Healthcare
WHAT PASSED

• The Legislature passed six new health insurance mandates along with other, new regulations on health insurance that will increase costs for employers and their employees.

WHAT DID NOT PASS

• The Legislature DID NOT pass a state government run MinnesotaCare public option, which would have slashed payments to doctors and hospitals, jeopardizing access to care and services and threatening increased health insurance costs and the stability of our health insurance markets.

Transportation
WHAT DID NOT PASS

• The Legislature did not pass legislation related to a Clean Transportation Standard in the state, which, according to estimates, would raise the cost of fuel by as much as 50 cents per gallon in just the first few years of operation and would negatively impact the state’s economic growth.

Telecom
WHAT PASSED

After years of work, a new law governing how companies manage their customers’ data passed. The bill contained an exemption for small businesses and largely aligns with laws already passed in other states.

WHAT DID NOT PASS

• A proposal to allow cities to impose franchise fee agreements on broadband providers was defeated. It would have allowed cities to create a new 5% tax on broadband service for customers.

Elections
WHAT DID NOT PASS

• A constitutional amendment that would have created an independent redistricting commission and allowed the legislature to meet year-round.
• A proposal to expand which local units of government could utilize Ranked Choice Voting.

Workers’ Compensation
WHAT PASSED

• GMG and the MN Chamber supported the Workers’ Compensation Advisory Council (WCAC) bill.
• The Chamber serves on the state’s Workers’ Compensation Advisory Council (WCAC), a statutory labor-employer council that negotiates reforms to the workers’ compensation system before recommending a consensus bill to the Legislature.
• The WCAC’s 2024 bill builds on many months of work by the WCAC and workers’ compensation stakeholders.

Pricing disclosure requirements (aka junk fee bill)
WHAT PASSED

• We opposed this bill due to concerns over uncertainty, increased litigation risk and the potential inconsistencies with current state and federal pricing regulations as well as a new federal regulation currently being proposed by Federal Trade Commission (FTC) for this exact same subject matter. HF 3438 added up front pricing requirements to the deceptive trade practices requiring a business to include all mandatory fees or services in the price of a good or service when advertising, displaying a good or service. The final bill was amended to address some concerns raised by the business community including delayed effective date to January 1, 2025 and adding language excluding some industries already covered by other state or federal pricing disclosure laws. Click to read more.