Minnesota leaders aim for fast action on infrastructure

Minnesota leaders have failed to devote significant dollars to roads, buildings and other infrastructure the past two years, compounding an expensive backlog of statewide needs.

Now legislators are contemplating fast action to catch up, with some eyeing two rounds of construction money in one year.

"These same projects are going to cost more the longer we wait," said Tom Dicklich of the Minnesota Building and Construction Trades Council.

The council represents construction workers and is one of many groups pressing for the spending, which Dicklich said "puts a lot of Minnesotans to work."

Key DFL and Republican lawmakers have started private discussions to resurrect an infrastructure deal that leaders brokered behind closed doors last spring. The plan included $1.1 billion in borrowing for state agency projects and roughly $400 million for local governments, said Senate Capital Investment Chair Sandra Pappas, DFL-St. Paul. Another $150 million in cash would go to nonprofit or local needs, she said.

That infrastructure package was derailed when broad bipartisan negotiations crumbled. Since then, construction costs have gone up about 20%, legislators said. They are looking at boosting last year's figure to cover the added expense.

Pappas said she would like an expanded version of last year's agreement to land on Gov. Tim Walz's desk in February.

That speedy timeline is uncertain. Infrastructure borrowing packages, called bonding bills, require a supermajority — three-fifths of the Legislature — to pass. It is one of the only areas where Republicans, now in the minority in the House and Senate, wield power this session.

Bonding bills are typically one of the last measures legislators agree on before ending their work in May. Whether GOP members are willing to give up leverage with an early deal remains to be seen.

Republican Rep. Dean Urdahl of Grove City, the GOP lead in the House Capital Investment Committee, said he believes three factors could make this year different: the lack of an infrastructure package the past two years, the scale of the state's historic $17.6 billion budget surplus and how close lawmakers came to a deal in 2022.

"Put that all together, and I really do think it could lead us to getting this done in the first half of the session instead of the last day," Urdahl said.

He said he expects the Legislature will pass one infrastructure deal this session and another next year, but is not sure there's an appetite for two rounds of funding in 2023.

Senate Republicans want a bonding bill this year, but most have yet to see details on what leaders privately negotiated last session, said Sen. Karin Housley of Stillwater, the ranking Republican on the Capital Investment Committee.

"We know they want to move quickly, and we're willing to. We just haven't seen anything," Housley said. She said many new legislators would have to get behind a deal.

Republicans have been like "Lucy with the football" in years past, pulling away a deal at the last minute, DFL House Speaker Melissa Hortman of Brooklyn Park recently said. If the GOP is not willing to partner on construction spending this year, she said, Democrats could use some of the surplus to fund projects. A cash approach would not require a supermajority vote.

Walz, Pappas and House Capital Investment Committee Chair Fue Lee have all said they would prefer a bipartisan measure that includes borrowing and cash.

Lee said his primary goal is to pass a version of the deal agreed on last year. He and Pappas said there is a queue of $6 billion in infrastructure funding requests.

If the initial agreement is signed into law early, Lee said he plans to push for another round of infrastructure funding this year — potentially using $2 billion in surplus cash. He has three priorities for construction spending.

"How do we make sure we make investments into communities that have not been traditionally invested in around racial equity?" Lee, DFL-Minneapolis, asked. "How do we ensure our investment is not contributing to the climate crisis? And three, really looking at how do we make a dent in the housing crisis we have?"

Legislators must negotiate the bonding bill with the governor. Walz is expected to reveal his infrastructure plan next week.

After talking to Republicans and Democrats about bonding, Walz said last week that "they are all saying it's a must." Echoing that message, he said legislators are gravitating toward clearing projects they already vetted and included in last year's deal, then coming back with a second bonding bill.

Another wrinkle in the infrastructure funding discussion is the need for state matching dollars to receive some money from the federal Infrastructure Investment and Jobs Act.

Lee said he anticipates matching funds for water infrastructure projects and electric vehicle charging stations will be included in an early bonding bill, but he is waiting to see Walz's plan. Other money related to the federal law, including $315 million for state road construction, are being considered separately from bonding negotiations.