COVID relief plan snagged on $500 payment to families

A group of people stand outside of a restaurant.
Gov. Tim Walz, standing outside Casper’s and Runyon’s Nook in St. Paul on Nov. 24, calls for a relief package for restaurants and other small businesses.
Tim Nelson | MPR News file

Minnesota lawmakers continue to work behind the scenes on a package of economic relief proposals aimed at helping businesses and workers who have been hit hard by the COVID-19 pandemic. One of the sticking points for the state's divided Legislature appears to be a proposal to issue $500 checks to low-income families.

State House Democrats proposed the one-time emergency payments for families enrolled in the Minnesota Family Investment Program, also known as MFIP. The plan would cost nearly $16 million. The money would come from the state’s share of federal block grant funds through the Temporary Assistance for Needy Families program, or TANF. 

House Speaker Melissa Hortman, DFL-Brooklyn Park,  said the proposal should be an easy one for lawmakers and the governor to accept.

“It would go to Minnesota’s neediest families,” Hortman said. “It would almost instantly go back into the economy and serve businesses, restaurants for take-out, you name it. It’s an economic stimulus, and I’m hopeful we can include that in this package at this time.”

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But even before Gov. Tim Walz sat down with House and Senate leaders to negotiate a deal on a relief package, there were concerns raised by Senate Republicans about the proposed payments. 

“The cash assistance is probably a problem, the $500 per person,” said Sen. Julie Rosen, R- Vernon Center, who chairs the finance committee. “That's not really something that the GOP is interested in.”

Sen. Jim Abeler, R-Anoka, also expressed concerns.

“It’s not a bad idea,” he said, “but the list of people across Minnesota who could benefit by $500 is a very, very long list.”

Abeler, chair of the human services reform committee, said he's reluctant to tap the TANF reserve account because he thinks the money could be better used to help people with even greater needs. Abeler noted that people in the MFIP program have not lost any of their state support during the pandemic.

“At some point we’re going to wish we had $15 million to do something in particular for this group,” he said. “And it may not be just $500 to everybody. There may be varying levels of need, and that’s my reason for the cold feet on it now.”

The proposal is not new. Lawmakers discussed a similar idea last spring, but they ultimately left it out of the state’s COVID-19 response bill that passed then.

Legislative leaders say they hope to have an agreement on COVID-19 relief ready for action later this month. Another in a series of special sessions is expected on Dec. 14 in response to the governor’s next 30-day extension of emergency powers to address issues related to the pandemic.

Rep. Mohamud Noor, DFL-Minneapolis, said the state has the money available to help more than 31,000 families and shouldn’t hesitate again.

“This is why we have a reserve account in the TANF program to ensure that we can help those who are underemployed, unemployed and those who have low incomes,” Noor said. “So, it fits the right purpose, and it’s the right moment.”