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Legislature passes supports for Minnesota workers and businesses

Clark Goldenrod, Betsy Hammer
Dec 18, 2020
Minnesota legislators voted to provide much-needed economic supports to workers and businesses in a one-day session earlier this week. As part of continued efforts to contain the spread of COVID, Governor Tim Walz announced additional restrictions on certain businesses in November. The legislation contains measures to help keep impacted workers and businesses afloat during what’s been a difficult year for many, including an extension of unemployment insurance benefits and several mechanisms to get funds to struggling restaurants, bars, theaters, and other businesses.  

However, as important as these measures are, additional action still is needed to counter the continued economic harm of COVID. This legislation did not include proposals from the governor and House for emergency financial support for the most vulnerable Minnesotans and to expand availability of affordable child care.  

But first, here’s what passed:  
  • Unemployed workers eligible for unemployment insurance will receive up to a 13-week extension. Without this action, many Minnesota workers would lose their wage-replacement benefits in the upcoming weeks because federal policymakers have failed to extend federal UI.  
  • Businesses and nonprofits that have been substantially impacted by the COVID crisis will receive about $217 million in grants through a few different mechanisms. The Department of Revenue will distribute $88 million in support for businesses like restaurants, bars, distilleries, and gyms. DEED will distribute $14 million to convention centers and movie theaters. The largest component, $115 million, will go to counties to distribute to local businesses and nonprofits. 
Unfortunately, the legislation did not take additional steps that would allow striving workers and families to pay the bills and get back to work. Items that were part of the negotiations but not the final agreement included:  
  • A $500 one-time emergency payment for extremely low-income families and children participating in the Minnesota Family Investment Program (MFIP). These families face the same economic challenges as others, yet are unlikely to benefit from other policy actions, such as expanded unemployment insurance. This provision would have ensured some of the state’s most struggling families could better afford essentials like rent, food, and diapers. It would be good for our economy too, as the most effective way to provide economic stimulus is to get resources into the hands of those who will quickly spend those dollars. 
  • Policy changes and funding to support critical child care infrastructure. Lack of child care is a top reason for work absences among essential workers, and more than 80 percent of families on the waiting list for affordable child care would be working in essential jobs if they could get care for their kids. Additional funding for affordable child care and continued emergency grants for providers would help keep essential workers in their jobs to keep hospitals, grocery stores, and other critical sectors operating. 
  • Emergency housing assistance grants. Families across the nation and in Minnesota are facing unprecedented levels of hardship, yet the legislation did not provide any new resources for Minnesotans who are struggling to afford basic necessities like housing.
As policymakers head back to the state’s Capitol in January, they will need to continue to act so that Minnesotans can navigate through this ongoing health and economic crisis.