38,000 state employees get layoff notices as budget work continues

Layoff notices went out to more than 38,000 state employees over the holiday weekend as Minnesota officials prepare for the possibility of a government shutdown.

Gov. Tim Walz and leaders in Minnesota's divided Legislature say the notices are hopefully just a formality as they continue work behind the scenes to finalize the state's $52 billion two-year budget. Yet a handful of major sticking points remain unresolved and work has progressed more slowly than anticipated since the regular session ended May 17.

Lawmakers are constitutionally required to pass a balanced budget before July 1 or state services begin to shut down.

"It doesn't feel like a necessary formality to the 40,000 folks who received these notices while they were relaxing with their families after a stressful year," said Megan Dayton, president of the Minnesota Association of Professional Employees (MAPE). "It's really insulting to the public servants, to the people who have dedicated their entire career to public service, and during the pandemic they've been working nonstop."

Walz and leaders struck a broad budget deal on the final day of session and have been working mostly in private to finalize the details ahead of a likely mid-June special session, when the governor is expected to extend his emergency powers for another 30 days. Leaders had set a deadline of last Friday to create spreadsheets detailing state spending, but they were still working on some of those documents Wednesday and had not made any of them public.

The layoff notices are required a month before a potential shutdown. In a letter to the state workforce, Walz said many employees would be laid off temporarily or placed on a leave of absence.

"This past year has been unbelievably challenging and I'm sorry that the budget situation at the Legislature causes additional stress and uncertainty," he wrote.

Republican Senate Majority Leader Paul Gazelka said there are lingering disagreements on policy issues including police reform measures, car emissions standards and a photo ID requirement to vote, but he expects work will get done before July 1.

He's frustrated that the DFL governor's comments put the blame squarely on the Legislature.

"Look, you're on the same side of the aisle as the Democrats in the House, you're the one who has to work with them to help influence them to come together to have compromise," Gazelka said. "I do believe we will get done before the shutdown would occur."

State government partially shut down in 2005 and again in 2011. That year, the courts determined that 80% of state services were essential and could continue despite a historic 20-day standoff between DFL Gov. Mark Dayton and the GOP-led Legislature.

But a later 2017 ruling from the Minnesota Supreme Court set a precedent that the judicial branch does not have the power to appropriate money, even if lawmakers don't do it themselves. That means the consequences of a shutdown this year could be much more dire for state services and employees.

"If there is a shutdown it is way different than it was under the Dayton shutdown," Gazelka said. "Many things don't get funded."

After thousands of members received layoff notices over the weekend, American Federation of State, County and Municipal Employees Council 5 Executive Director Julie Bleyhl said the union remains "optimistic" that the budget will be finalized but members need to be prepared for a potential shutdown.

She said they're particularly worried about 5% state agency budget cuts proposed by Senate Republicans, which she said would "devastate" state services and hit the public sector workforce.

"No worker should ever be treated as pawns in a political chess match," she said.

Republicans have said the cuts are necessary as the COVID-19 pandemic pummeled the economy and Minnesotans have had to tighten their own belts.

Megan Dayton said MAPE members have been critical in the state's response to the pandemic, including epidemiologists in the state Department of Health and hundreds of people who were redeployed to help the state with contact tracing.

Many employees at the Department of Employment and Economic Development have had their vacation requests refused over the past year as they processed a historic surge in claims for unemployment benefits from out-of-work Minnesotans.

"There's this message that has been pushed by the Legislature for the last few years that state government doesn't need all that is has, which is absolutely untrue," said Dayton. "COVID has shown us that we need a really strong government."

Staff writer Jessie Van Berkel contributed to this report.

Briana Bierschbach • 651-925-5042

Twitter: @bbierschbach