State lawmakers plan to work through the Memorial Day weekend to finalize Minnesota’s next $66 billion, two-year budget, which they failed to pass by Monday’s legislative deadline.
Republican Minnesota House Speaker Lisa Demuth, right, and House Democratic-Farmer-Labor Leader Melissa Hortman, left, address reporters during a news conference at the state Capitol in St. Paul on Thursday, May 22, 2025. (Alex Derosier / Pioneer Press)
Leaders hope they can wrap up negotiations between the House — evenly split between Republican and Democratic-Farmer-Labor members — and the DFL-led Senate by early next week, so that Gov. Tim Walz can call them back for a special session to pass a budget before the end of the month.
If they don’t, state employees will get layoff notices starting June 1 warning of a potential government shutdown in July. The fiscal year ends June 30, and the Legislature has to authorize new spending before then in order to keep the state running.
“Working groups” have been meeting since Tuesday, mostly in private, to finalize details on big spending areas like K-12 education and health and human services, which account for two-thirds of state general fund spending.
“Even though it’s slower than we would like, things are going well. It doesn’t appear that anyone has quit or given up, and that is a very good sign,” Republican House Speaker Lisa Demuth of Cold Spring told reporters Thursday. “Our expectation is they’ll be here working until they can come up with an agreement and move it forward.”
There’s been progress on a handful of bills, but as of Friday evening, there was no public information on final deals for taxes or the biggest parts of state spending. A controversial provision in the budget deal reached by legislative leaders and the governor last week may be slowing progress on the health bill.
DFLers and Republicans agreed to end state-funded MinnesotaCare health insurance for adults in the U.S. without legal immigration status, a benefit DFLers created while in control of state government in 2023. Republicans agreed to preserve care for children, but many Democrats remain strongly opposed.
Senate Majority Leader Erin Murphy of St. Paul wants MinnesotaCare cuts to travel as a separate bill, but Republicans want it to run with the overall health package. At a Thursday joint news conference with Demuth, House DFL Leader Melissa Hortman of Brooklyn Park said they hadn’t resolved the matter.
Both the DFL and Republican House leaders said they’re confident Walz will sign all parts of the budget deal into law and still would approve cuts to immigrant care even if it traveled separately from a broader health bill.
Further complicating matters are the unique dynamics of co-leaders from both parties in the House working with the DFL majority in the Senate. The last time the House was tied was in 1979. Murphy called the House a “two-headed monster.”
“It’s been more challenging than usual to sew this all together,” she told reporters on Thursday.
Working groups have already passed their leadership-imposed Wednesday deadline to finish work on bills, so leaders from both parties said they are getting more closely involved. They haven’t moved to take over the bills for committee chairs yet, but the option remains on the table.
Murphy said she was skipping cabin plans for the weekend to make sure work gets done.
As of Friday, most negotiations have taken place in hearings that are not publicly posted or open to the general public.
A few key budget pieces had public hearings on Thursday — K-12 and human services — though the tax bill has been the only part that has had daily public hearings since the working group process started. The Legislature only passed a handful of the 20 or so budget bills in the regular session.
On Thursday, Hortman said the commerce, workforce and human services bills were close to completion. While there had been some trouble with energy and K-12 education, most of the budget deals were approaching completion.
House leadership sent Reps. Paul Torkelson, R-Hanska, and Zack Stephenson, DFL-Coon Rapids, to help mediate. As of Friday, it was unclear if they were any closer to a deal.
“The only ones that are very far from having a fully formed bill ready to post is probably taxes and maybe health,” Hortman said Thursday. “The rest of them I think you are going to see posted spreadsheets soon and posted language not too long after that.”
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