Walz, Top Lawmakers Strike Deal On Tax Cuts, New Spending

ST. PAUL, Minn. (FOX 9) – Gov. Tim Walz and top lawmakers have struck a deal that carves up Minnesota’s budget surplus into tax cuts, new classroom spending, and public safety.

The agreement calls for $4 billion in new spending, $4 billion in tax cuts, and leaves $4.2 billion on the budgetary bottom line in case the economy worsens. That broad framework leaves many details for lawmakers to sort out with one week left in the 2022 session.

Public schools will get $1 billion of the new spending over the next three years, according to a signed one-page agreement released by Walz’s office early Monday morning. Another $1 billion will go into health and human services, while $450 million heads to public safety. Separately, the deal calls for a $1.4 billion public infrastructure bill.

“With an unprecedented surplus, we have the ability to make significant investments in the things that will improve Minnesotans’ lives, like health care, public safety, and education, while also providing tax cuts and putting money in Minnesotans’ pockets,” Walz said in an emailed statement.

Walz and legislative leaders are scheduled to hold a news conference at 10 a.m.

Lawmakers now must race to fill in the gaps of the broad framework. Conference committees stopped meeting Friday as Republicans held their two-day endorsing convention in Rochester. Democrats are scheduled to hold their own convention starting this Friday, also in Rochester.

The framework calls for $1.6 billion in tax cuts over the next year and $2.4 billion in two years after that.  Senate Majority Leader Jeremy Miller said it would include income tax cuts that Senate Republicans have pushed as their top priority. It was not immediately clear whether rebate checks, as Walz and House Democrats have sought, would be included.