On Tuesday, based on reporting from KSTP, I wrote about how, in 2023, the state government voted to give $1.5 million of Minnesota taxpayer’s money in grants to a company which wasn’t even registered with the Secretary of State. The company has since received hundreds of thousands of dollars despite not meeting reporting requirements.
Among several, one aspect of the story in particular caught my eye. KSTP reports that the:
[Minnesota Department of Employment and Economic Development] DEED acknowledged it was responsible for a “historic” amount of funding that year – $1.8 billion in total, roughly 10 times more than normal. Officials said the funding surge required hiring and training additional staff, but maintained they are proud of the agency’s overall response.
So part of this latest fiasco involving Minnesota taxpayer’s money was the result of the sheer scale of spending undertaken by that “historic” trifecta in 2023; it simply overwhelmed the capacity of the state government to maintain appropriate safeguards.
This won’t be a surprise to anyone who was up at the Capitol during that orgy of spending. Here is something I wrote at the time:
This morning, HF2, the proposal for paid family and medical leave, sailed through its fifth House committee hearing. Perhaps one reason for its speedy passage is that it isn’t weighted down by a fiscal note.
Fiscal notes, according to the House Fiscal Analysis Department:
“…put a price tag on proposed legislation, and are very important in the legislative process. A fiscal note should be an objective opinion on the change in expenditures and revenues that will result from a bill. Legislators need this information to make informed decisions on proposed legislation. A fiscal note may influence if a bill passes, if it fails, or if changes need to be made to the bill to adjust the cost or revenue.”
And, today, without this vital information, HF2 passed the State and Local Government Finance and Policy committee, the very committee tasked with overseeing — as the name indicates — state and local government finance.
HF2, remember, is a bill under which “as many as 400 new bureaucrats will be hired using an entirely new computer system: think MNLARS, or MNsure.” How can the committee charged with overseeing state and local government finance possibly vote on this bill without knowing what the financial consequences will be?
I would be tempted to call this the “Brewster’s Millions” style of government, but that would be unfair to Monty Brewster: he knew how much money he was spending.
Rep. Jim Nash (R) made the point that it was impossible for the State and Local Government Finance and Policy committee to make an informed vote on measures pertaining to state and local government finance without knowing what the financial costs of that measure would be. The committee chair, Rep. Ginny Klevorn (DFL), replied that with 1,500 bills introduced, the legislature is “overwhelmed” and so has no choice but to vote on them without fiscal notes: in other words, they are trying to do so much so quickly that they have no choice but to make uninformed decisions.
The 2023 session is often called “historic.” Many things have been historic — disco, the Black Death, that time Geraldo opened Al Capone’s vault on live TV — without being good. The sad truth is that the 2023 session was a badly managed bungle of epic proportions the consequences of which Minnesotans will be saddled with for years.
How bungled and epic? The session opened with a forecast budget surplus of $17 billion for the 2024-2025 biennium. As my colleague Martha Njolomole noted recently, it “raised general fund spending from $27 billion in 2023 to $35 billion in 2024 — a staggering 26 percent increase after adjusting for inflation,” and this, remember, without the proper safeguards either in legislative committees or at agencies like DEED. “In 2024,” Martha continues, “Minnesota spent $4.7 billion more than it collected in revenue. The gap has shrunk, but the trend remains the same. Over the current forecast period, spanning 2026 to 2029, spending continues to outpace revenue by an average of $1.6 billion a year.”
