Minnesota Legislative Update: End of Session

Update, June 1, 2010

2010 Session Context

Although some important child-related policy provisions were adopted, budget-balancing was the major focus of the legislative session. Despite substantial spending cuts in 2009 that decreased state spending below the prior budget’s level, Minnesota faced another projected deficit at the start of the 2010 session. Legislators and the Governor also had to address the potential of additional federal health care funds and a court decision, late in the session, overturning the Governor’s budget cutting unallotments from 2009.

In the end, after the Governor vetoed an income tax increase on the wealthiest Minnesotans, legislators and the Governor agreed on a combination of spending cuts and spending shifts. The areas hit hardest by the budget cuts were health and human services programs (including some children’s programs) and county and city government aid.  Spending was delayed (through budget shifts) in K-12 education and corporate and sales tax refunds.  The education spending shift means that many school districts will have to borrow money to make it through the school year, using some of their revenue to cover interest, instead of direct education, expenses. While the spending cuts help reduce the deficit forecasted for the next budget cycle, the spending shifts do not, leaving a $5.8 billion deficit for the next session.

The Legislature and the Governor did agree that any additional federal matching funds for Medical Assistance that may arrive between sessions should be used to help the state’s bottom line. Minnesota faces substantial cash flow problems if the additional money does not arrive, which may affect the rate at which providers and other state contractors are paid.

The Governor and legislative leaders put off deciding whether to take advantage of greatly enhanced federal health care coverage for the poor until after a new governor is elected.  Combined with the budget challenges, the next Governor will be in a position to make some very important decisions about the future of the state. 

Legislators did pass some policy initiatives that will benefit children. Some were vetoed, others were signed into law.

Child-Related Legislation

Major budget actions (in addition to K-12 education) affecting children:

  • Child Support Enforcement Grants cut by $4.7 million;
  • County child welfare services support (Children and Community Service Grant) cut by $18.4 million;
  • New Child Mental Health Specialty Grant program eliminated, saving
  • $.4 million;
  • One-time Basic Sliding Fee Scale child care "under spending" captured, saving $7.5 million (permanent cuts to child care assistance funding base were avoided);
  • Work bonus for former MFIP families reduced from $50 to $25, saving $1.6 million;
  • Health care provider payments cut for some services, decreasing access to health care for adults and children.

Major child-related policy provisions:

  • A positive step forward was taken in the Food Support program with the elimination of the $7,000 asset test and an increase in the gross income level from 130 to 165% of the federal poverty guideline. An additional 70,000 Minnesotans may be able to access Food Support benefits as a result of these changes, which some experts estimate would bring in about $60 million dollars in federal funding to the state of Minnesota. (Click here to see our report, Asset Limit Reform:  Removing Barriers to Promote Self-Sufficiency). 
  • The Ladders Out of Poverty workgroup was signed into law, creating a legislative work group to develop specific policy recommendations and asset building recommendations.
  • Teens in foster care and homeless youth will be able to get their driver’s license and older teens will remain eligible for some supports as they transition from foster care to young adulthood. They will also be able to participate in court decision affecting their future.
  • Several steps forward were taken in early childhood policy, including more support for the child care quality rating efforts, allowing teen parents who are in school to receive child care aid through the school year, creating a school readiness report card, directing the state to recommend ways to improve early childhood screening and assessments, and exploration of the creation of a cabinet level office focused on early childhood.
  • The Juvenile Omnibus Bill, which would have improved the treatment of our juvenile offenders and provided for the expungement of juvenile records, was vetoed by the Governor.
  • The Healthy Kids/PE bill was passed and signed into law which will help school districts create healthier practises for children around physical exercise.

For more details on the budget actions see the Budget Project’s website,click here.

Copies of the final spreadsheets can be found on the House and Senate Fiscal Staff’s websites, click here.

For more detailed early childhood summary by Ready 4 K, click here.

For more information on low-income provisions by Affirmative Options, click here.


Update, May 17, 2010

In the early morning hours, Minnesota legislature and Governor agreed on a budget that closed the state's $3 billion shortfall.

It looks like the following cuts were made to children's programs to balance the  budget (FY 10-11):

  • Reduce Child Support Enforcement Grnts (-$4.7 M)
  • Reduce Children and Community Service Grnts (-$18.4 M)
  • Eliminate Child Mental Health Specialty Grnts (-$.4M)
  • Capture one-time Basic Sliding Fee Scale "underspending" (-$7.5M)
  • Eliminate work bonus for former MFIP families (-$1.6 M)

Good news:  The asset test for Food Supports was eliminated. (Click here to see our report, Asset Limit Reform:  Removing Barriers to Promote Self-Suffiency). 

 As has happened in prior budget cutting sessions, federal TANF money (that could have been used to increase anti-poverty efforts) were once again used to refinance state spending to help balance the budget. There are also a lot of health care provider cuts that could impact children and families' access to health care.

In the end, the cuts made in HHS related to kids were substantially less than the Governor recommended.  And for the thousands of Minnesotans currently on state-funded health programs (GMAC), depending on what the governor or his successor decides, they may or may not be moved to Medicaid, which uses state and federal funds.  

Next year's legislators may face harder decisions still, as many of the savings in this year's budget depended on accounting shifts and waiting to send payments to school districts.


Update, May 14, 2010:  

With just a few days to go in the session (which must end by May 17), the Governor vetoed the Health & Human Services bill. That veto, combined with the Governor’s previous veto of a tax increase on the highest earning Minnesotans, means that state leaders will have to look for additional places to cut to balance the budget.

The vetoed HHS bill already contained reductions in children’s programs. Although smaller than the reductions proposed by the Governor, the bill cut child care assistance, block grant funds to counties for child welfare and other services (CCSA) and eliminated a small payment to help families who have worked their way off MFIP. 

In addition to the budget bills affecting children, the Governor also vetoed the

Juvenile Omnibus Bill (Lesch/Moua). The bill, which had bipartisan support, would have improved the treatment of our juvenile offenders.

Now would be a good time to call the Governor and your legislators and let them know that it is shortsighted to take any more money out of programs serving children.  Short-term savings in these programs will likely result in more costly expenditures down the road. Like the budget gimmicks both sides denounce, cutting children’s programs ‘kicks’ the problem down the road.

A legislative summary will be available on the CDF-MN website once the session ends.

April 30, 2010 Minnesota Legislative Activity Update

Legislative activity, which had slowed after the spring break, has picked up again. Legislators were waiting to hear how much federal health care money would be available to help the state with its $1 billion projected deficit. Legislators have also been struggling with the complications accompanying the Governor’s veto of funds for the General Assistance Medical Care program. Although not part of the health care debate this year, children’s programs are affected by this discussion as policy makers look for places to get funds to fund basic health care for poor adults and balance the budget.

The Senate Health & Human Services (HHS) Finance committee presented its budget this morning (April 29) but as of the writing of this update, the spreadsheet was not available online. The House released its HHS plan earlier this week. Both the House and Senate reduce funding for the Child Care Assistance Program, although not at the level of cuts proposed by the Governor. The Senate used Medicaid surcharge money to avoid some of the cuts adopted by the House, including substantial cuts to children’s mental health and the Minnesota Family Investment Program (MFIP). The Senate bill does however make a deeper cut in child care aid.

A conference committee to resolve differences between the two bodies will begin meeting soon, once the Senate bill is done. The HHS bill is likely to be a major source of contention between the Governor and the Legislature, based on past experience.

Other Legislation

Early Childhood Reorganization: The House adopted a bill containing provisions related to early childhood, including issues the State Advisory Council on Early Childhood Education and Care should consider in its study regarding coordinating and collocating early childhood and child care programs in one state office, and development of a statewide report card if private funds are available (expected from the coalition of funders who support the bill). Some version of these issues is likely to be included in a Senate bill and resolved in conference committee.

Child Welfare:  Legislation  (SF 2690 Torres-Ray/ HF 3039 Hayden) recently signed by the Governor will let teens in foster care get drivers’ licenses and permits. It also allows teens and a young adult to retain their foster care benefits to age 21, even if they leave care for a time, and allows children to personally attend hearings about their care and placement. Another bill (SF 2687 Torres-Ray/HF 3019 Hayden)—the Protecting Children and Strengthening Families Act—was introduced and heard in both bodies but action is not expected at this time. Both bills are supported by the Child Well-Being Network, which represents a variety of organizations, including CDF­–MN.

Child Support Enforcement: SF 2562 Betzold/HF 3299 Hayden, also already signed by the Governor, strengthens current provisions by giving child support offices more authority to gather information to locate noncustodial parent who don’t have or aren’t paying their order, and lengthens the time child support orders are in effect from 10 years to 20 years. The bill also amends the law to make sure child support payments follow a child if he or she moves (e.g., if a child goes to live with a grandparent).

Asset Limits: Awaiting inclusion in the HHS budget bill is legislation (HF 453 (Fritz)/SF 481(Berglin) eliminating the Food Support (formerly called Food Stamps) asset limits and raising the income limit to approximately 165% of the federal poverty level ($30,000 for a family of three).  For more information on Asset Limits, read CDF–MN's recent report, Asset Limit Reform:  Removing Barriers to Promote Self-Sufficiency.

Ladders out of Poverty: A bill (HF 2062 Lanning/SF 1770 Jungbauer) creating a legislative task force to identify specific strategies to help families move out of poverty is working its way through the Legislature. The small cost associated with members’ compensation is holding up its adoption.

Juvenile Justice: Juvenile Justice Omnibus Bill, SF 2790, created by Senator Mee Moua is moving through the Senate process. This bill does a number of important things to help ensure that our children who make mistakes have an opportunity to get past them and reach their full potential, like making juvenile records more secure, require substance abuse screening as well as mental health screening available, and increase the stays of adjudication so juveniles can receive adequate treatment and programming.

Copies of all of the bills and updates regarding their current status are available on the Minnesota Legislature’s website.