Monday Morning’s Hot Cup of Political Realitea - March 2–6

Budget Forecast 

Minnesota Management & Budget’s February forecast projects a $3.7 billion surplus for FY 2026–27, about $1.3 billion more than estimated in November. But spending still outpaces revenue, leaving only $377 million available in FY 2028–29, and officials warn that volatile revenue sources and federal uncertainty — notably the Trump administration’s threat to freeze $259 million in Medicaid funding — could quickly turn the surplus into a deficit. Monday’s House Ways & Means meeting will provide a detailed walkthrough of the forecast and possible uses for the surplus. 

Reactions to the Forecast 

Republicans maintain that Minnesota still has a spending problem. House Speaker Lisa Demuth wants a bipartisan tax conformity bill that exempts tips and overtime from income tax and insists that no new spending be added. Senate Minority Leader Mark Johnson warns short-term surpluses won’t cover long-term obligations; GOP Floor Leader Rep. Harry Niska credits probusiness policies for the surplus and calls the DFL budget a “fiscal disaster.” 

DFL leaders say the forecast is meaningless without stopping the federal Medicaid cuts. House DFL Leader Zack Stephenson says the surplus comes with the “biggest asterisk ever” because the cuts would wipe out the gains. Floor Leader Jamie Long calls federal actions a disaster for working families, while Ways & Means Co-Chair Cedrick Frazier sees positive signs but emphasizes the uncertainty and vows to focus on affordability and fairness. 

Legislative Gridlock 

The House’s 67–67 split led to several high-profile stalemates last week. A bill to ban semiautomatic assault weapons (HF 3433) failed on a 10–10 vote after testimony from gun violence prevention and Second Amendment advocates. Another bill to let cities regulate firearms locally (HF 3351) also deadlocked 6–6. A proposal to create an Office of Inspector General (HF 1338) deadlocked 7–7 amid disagreement over who would appoint the watchdog, even as House Democrats unveiled a broader fraud prevention package aimed at modernizing state IT systems and expanding Medicaid fraud enforcement. 

Other Hearings & Bills 

• The Senate Judiciary Committee advanced the Equal Rights Amendment (SF 473), moving the proposal closer to appearing on the 2026 ballot. 

• The House Commerce Committee heard testimony on “nudification” technology, with victims urging passage of HF 1606 to ban software that digitally removes clothing from images and allow civil suits against its creators. 

• The House Public Safety Committee considered HF 3413 to bar law enforcement officers from wearing identity-obscuring masks except in limited circumstances. Supporters linked it to transparency after immigration raids; opponents said it could endanger officers. The committee tied 10–10. 

Federal & Legal Developments 

The Trump administration’s Medicaid funding freeze prompted Gov. Tim Walz to propose a new antifraud bill with stronger oversight and penalties. The BCA disclosed that the FBI won’t share evidence from the shooting of Alex Pretti and two other ICE-related deaths; Superintendent Drew Evans called the refusal unprecedented but vowed to continue investigations. A federal judge has ordered ICE to explain why it hasn’t returned property seized during Operation Metro Surge, and U.S. Attorney General Pam Bondi announced 30 additional indictments related to the occupation of a St. Paul church. 

What’s Ahead (March 2–6) 

Monday, March 2 

House highlights: Ways & Means meets to hear Minnesota Management & Budget’s presentation on the new forecast and take up HF 3425 (supportive housing grants). Fraud Prevention & State Agency Oversight will receive a Department of Human Services presentation on nonemergency medical transportation. Afternoon hearings include Agriculture Finance & Policy (FFA officer greetings, HF 3580 depredation compensation fund and HF 3566 criminal penalties for damage to farm machinery), Elections (several election judges and public information list bills), Health Finance & Policy (HF 3668 – creating an Office of Gun Violence Prevention; HF 2779 – healthcare ownership transparency; HF 2771 – regulating private equity nursing home acquisitions), and Transportation (HF 3739 – renaming Hwy 610 for Speaker Hortman; HF 3430 – EV surcharges; HF 3356 – removing emergency vehicle insignia; HF 3695 – standardized ID for emergency responders). Floor Session at 3:30 

Senate highlights: Energy receives an update on the new Minnesota Climate Innovation Finance Authority, Jobs learning about AI, and Human Services hearing SF 3780 compelling DHS to release an unrelated Optum report on fraud. Floor Session at 11:00 

Tuesday, March 3 

House highlights: Children & Families hears HF 3542 (child care assistance integrity); Commerce takes up HF 3604 (nonoxygenated gasoline), HF 3709 (virtual currency custody) and HF 3766 (travel insurance regulation). Human Services considers HF 3526 (home care licensing and special projects grants). State Government reviews fraud prevention bills, including HF 3683 and the Fraud Isn’t Free Act. Public Safety hears HF 3405 (BCA investigations of federal agents) and HF 3413 (ending local ICE agreements). Taxes examines HF 3524/HF 3525 to conform to federal tax changes and deduct overtime and tip income.  

Senate highlights: Education Finance discusses the MN Violence Prevention Project; Health & Human Services reviews the February Forecast and its impact; Commerce & Consumer Protection is slated to receive an MDH presentation on the second 340B Covered Entity Report and discuss the future of the program and consumer data legislation; Housing & Homelessness Prevention previews bonding-related and tax credit housing proposals. 

 Wednesday, March 4 

House highlights: Commerce examines HF 3794 and HF 3408 banning surveillance-based price and wage discrimination. Human Services focuses on mental health bills (HF 3738, HF 2295, HF 3520, HF 3666). Transportation hears HF 3576 (third-party road tests), HF 3553 (vehicle platooning), HF 3513 (autonomous vehicles). Housing Finance hears HF 3806 (housing infrastructure bonds), HF 2687 (limiting corporate purchases of single-family homes) and HF 497 (housing mediation funding). Public Safety examines HF 962 (discipline rules for Brady Giglio lists) and HF 2879 (organized retail crime board). 

Senate: Jobs & Economic Development is briefed by the Department of Employment and Economic Development on unemployment insurance, Judiciary & Public Safety considers updates to data protections for property tax appeals (SF 3804).  

Thursday, March 5 

House highlights: Workforce & Economic Development holds a hearing on worker misclassification. Capital Investment hears bonding presentations from the Minnesota Zoo, University of Minnesota, DNR and other agencies. Education Finance considers safe schools funding bills (HF 3653, HF 2717) and HF 3451 (anonymous threat reporting grants). Environment & Natural Resources receives an OLA audit presentation and DNR report. Floor Session at 3:30 

Senate: The Finance Committee reviews the February forecast and discusses surplus allocation proposals including the creation of an emergency rental assistance fund (SF 3596). Capital Investment hosts bonding presentations from universities and state agencies. Floor session at 11:00 

The Deets: 

• Weekly Calendar 

• House Leadership 

• House Floor amendments 

• Senate Leadership 

• Who Represents Me? 

• February Forecast