Walz asks lawmakers to back record $2.7 billion bonding bill

Gov. Tim Walz speaks at a press conference.
Gov. Tim Walz speaks at a press conference in St. Paul in June 2020. On Monday, the governor asked the Legislature to back a $2.7 billion “local jobs and projects” plan.
Evan Frost | MPR News 2020

Updated: 3:30 p.m.

Gov. Tim Walz asked the Legislature on Tuesday to back a $2.7 billion “local jobs and projects” plan that's considerably larger than the record package that lawmakers passed two years ago.

The Democratic governor unveiled his wish list at a news conference outside the University of Minnesota's Institute of Child Development, which is getting a major rebuild thanks to money from the $1.9 billion package approved by the 2020 Legislature.

“We’ve got opportunities across Minnesota,” said Walz. “There are jobs in local communities. They are geographically spread across the entire state. They focus on water infrastructure. They focus on the things that make life simply better for folks, as well as investing for the future as you see in this project here.”

Walz used the construction site as a backdrop to highlight how 38 percent of his proposal, or more than $1 billion, is for asset preservation to maintain and upgrade properties that taxpayers already own.

Another 21 percent — more than $560 million — would go to various new infrastructure projects, including $120 million for local bridge replacements, $90 million for local road improvements projects and $200 million for local water infrastructure.

Sixteen percent would go toward housing, including projects to combat homelessness. And 10 percent would go toward protecting the environment.

Three men wearing safety face masks talk in a large room.
Gov. Tim Walz (center) talks with Josh Kalina, a coordinator in the apprenticeship training program, and apprentice Travis Sturges (left) after Walz signed a $1.9 billion public works bonding bill into law in October 2020 in St. Paul.
Christine T. Nguyen | MPR News

Lt. Gov. Peggy Flanagan noted that the bonding proposal also has a focus on racial equity.

“To ensure communities who’ve been traditionally excluded from capital investment are now included, organizations that focus on Black, Native and community-of color-led organizations are included in our bonding bill, and we think it’s pretty good work,” said Flanagan.

Minnesota Management and Budget Commissioner Jim Schowalter stressed that the $2.7 billion proposal is affordable.

“This recommendation is fiscally responsible. It’s within our budget guidelines, within our financial guidelines and it really helps push forward a lot of good projects. It takes care of a lot of deferred maintenance that we really need to take care of,” he said.

Schowalter says about $2 billion of the proposal would come from general obligation bonds. The rest would come from other sources, including a cash component.

Walz said he thinks the size of the proposal makes sense.

“The state of Minnesota’s economy has grown bigger,” the DFL governor said. “So, as a percentage of our economy and a percentage of our buying power, this looks relatively similar to what you would have seen 10 years ago in a bonding bill.”

Public works borrowing packages, also known as bonding bills, are traditionally the centerpiece of Minnesota's legislative sessions in even-numbered years. Walz is unlikely to get everything he proposed. The final packages are usually the product of intense negotiations and they require a three-fifths supermajority in both the House and Senate to pass.

Rep. Dean Urdahl, of Grove City, Minn., the lead Republican on the House Capital Investment Committee, said he thinks the governor’s bonding wish list is too big.

“I’m not interested in setting a bonding record, and I don’t think my caucus colleagues are either,” he said.

Sen. Tom Bakk, an independent from Cook, Minn., who caucuses with Republicans, is the chair of the Senate Capital Investment Committee. Since a bonding bill must originate in the House, Bakk thinks an early vote on the governor’s plan in that chamber would be helpful.

“If it can’t pass, then I think there needs to be a bipartisan conversation about kind of what’s the number, rather than everyone playing cat and mouse between now and May,” Bakk said.

Bakk’s committee was spending the day touring the locations of several proposed bonding projects in the southern metro area, including the Minnesota Zoo.

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