Regular Session Ends

The Minnesota Legislature adjourned the 2025 Regular Session on Monday night, but a special session looms on the horizon as legislators failed to pass a complete budget. Despite meeting through the weekend and on Monday, little progress was made to get to final resolution. Each caucus held a press conference or media availability on Monday, and while their specific messages differed, each pointed fingers at others as the reason for the deadlock. Of course, the blame game matters little to those who count on the legislature to get their work done.

Several Bills and Budgets Passed

A complete list of passed laws is available on the Office of the Revisor of Statute’s website. Significant policy and budget bills that were passed include:

• Agriculture, Broadband and Rural Development Budget and Policy (H.F. 2446)
• State and Local Government and Elections Budget and Policy (S.F. 3045)
• Cannabis Policy (S.F. 2370)
• Housing and Homelessness Budget and Policy (S.F. 2298)
• Judiciary Policy and Budget (H.F. 2432)
• Legacy Finance (H.F. 2563)
• Veterans and Military Affairs Budget and Policy (S.F. 1959)
• Pensions (S.F. 2884)
• Unemployment Insurance Funding for School Workers (H.F. 1143)
• Human Services Policy (H.F. 2115)
• Workers Compensation Advisory Council Recommendations (H.F. 3228)

Most of the Budget Didn’t Pass

If the legislature is unable to pass a complete budget in a special session by June 30, the following budget jurisdictions may face a shutdown:

• Commerce
• Education (K-12, Higher Education)
• Energy
• Environment / Department of Natural Resources
• Health / Human Services
• Department of Employment and Economic Development (DEED)
• Transportation
• Taxes
• Capital Investment

Special Session Expectations

Governor Walz has expressed his hope to have the budget passed by June 1, which is when layoff notices would begin to be sent pending a government shutdown. The current budget expires after June 30, and any agencies for which a budget has not been passed by that date would face a shutdown beginning on July 1. The Governor has stated that he will call a special session after agreement is reached on all of the budget areas, with the expectation that the special session will be 1-3 days in length.

What Progress Has Been Made

Despite a deadline imposed by leadership of 5:00 p.m. on Wednesday, May 21, for work to be completed on all outstanding budget bills, many of the bills are still being negotiated. Most of the negotiations are taking place behind closed doors. Following are updates that have been made publicly available:

• Taxes – A working group has been holding public meetings and exchanging offers. They have yet to find agreement.
• K-12 Education Policy – Agreement has been reached on various K-12 policy provisions. Further information can be found here: Education Finance – 5/22/2025 (mn.gov) Negotiations continue on additional issues.
• Jobs/Workforce/Labor – Agreement has also been found for these areas. While final language is not available, summaries of the agreement and detailed information can be found here: Workforce, Labor, and Economic Development Finance and Policy – 5/22/2025 (mn.gov)
• Human Services – Held one public meeting but has not reached agreement.
• Commerce – A signed agreement among working group members has been posted on social media, but details have not been publicly released.
• Higher Education – A signed agreement among working group members has been posted on social media, but details have not been publicly released.

Governor and Legislative Leaders Agree to Budget Targets

On Thursday of this week, the Governor and legislative leaders announced that they had reached agreement on budget targets, a copy of which can be found here. While this deal is welcome, it comes too late for any realistic hope that the budget work will be completed by the constitutional adjournment deadline of Monday, May 19, at midnight. Conference committees still need to work through many smaller issues, both spending- and policy-related. A special legislative session will be necessary to finish the Legislature’s work.

Health Care for Undocumented Immigrants

The Governor and legislative leaders have been negotiating for weeks — a major sticking point in these negotiations was whether to eliminate undocumented immigrants from eligibility for MinnesotaCare, the state’s health insurance program for low-income residents. Republicans supported the elimination and DFLers generally opposed it. While MinnesotaCare eligibility for undocumented immigrants began January 1, 2025, the budget agreement reached by the Governor and legislative leaders yesterday would end this eligibility on December 31, 2025. However, coverage for undocumented children will continue.

Budget Agreement Opposed

Passing undocumented immigrants health care into law was touted as a major accomplishment of the 2023-2024 DFL Trifecta, so its current elimination is controversial. Speaker Emerita Melissa Hortman (DFL-Brooklyn Park), who signed the budget agreement, acknowledged that it was a very emotional issue for her caucus. House and Senate members of the People of Color and Indigenous Caucus held their own press conference and passionately opposed eliminating health care for undocumented immigrants. It remains to be seen how this opposition will impact passage of the omnibus budget bills and the implementation of the budget agreement.

Tax Bill Update

With only three days left in the legislative session, neither the House nor the Senate have held a floor debate or passed an Omnibus Tax Bill. The House Omnibus Tax Bill, H.F. 2437, was scheduled to be heard on the House Floor on Tuesday, but it was pulled at the last minute. Since tax bills must originate in the House, the Senate is unable to pass its version of the bill, S.F. 2374.  It is likely that the Omnibus Tax bill will be addressed in a special session.

Special Session and 2026 Legislative Session

Legislative leaders have indicated that they hope to hold a special session on Thursday, May 22, to pass any omnibus bills that aren’t approved by Monday’s deadline. Also, it was announced this week that the 2026 Legislative Session will convene on February 17, 2026. We’ll see you there!

Budget Status Summary

With the end of the 2025 legislative session fast approaching, legislators are working to approve the omnibus finance bills necessary to implement a FY 2026-2027 Biennial Budget. Legislative leaders and the Governor continue to work behind closed doors on global targets with rumors swirling that a deal is within grasp. However, as you can see from the chart below, the House and the Senate have yet to pass a number of major finance bills as of this writing (May 9).

Non-Controversial House Tax Bill

With the House tied at 67-67 between Republicans and DFLers, it should come as no surprise that the House Tax Committee this week passed a non-controversial Omnibus Tax Bill. The bill is a collection of no- or low-cost provisions and policy tweaks across tax types advocated for by various stakeholders and interest groups. Working with only a $40 million target for FY 2026-2027, the Tax Committee’s options were limited.

Senate Tax Bill Includes Revenue Raisers

While the House pieced together a bill that could pass a tied chamber, the Senate used a higher budget target to assemble a bill that raised new revenue, combined with cuts to certain tax spending. The Senate bill raises $317 million in general fund revenue and includes $48 million in reductions to aids, credits, and other expenditures to equal a $365 million budget target. The main sources of revenue include a new social media excise tax, an increase in the net investment income tax rate, and a lowering of the net operating loss deduction limit. The Senate cuts Local Government Aid, County Aid, the Film Credit, and the Sustainable Forest Incentive Payment Program.

Changes to Employer Mandates in Play

Changes to employer mandates are part of the negotiations for global budget targets. Modifying employer mandates, which passed during the DFL trifecta’s majority in 2023 and 2024, has been a priority for the business community and Republicans this legislative session. While Republican leaders are attempting to negotiate a more workable definition of “family” under the new paid family leave law, a bipartisan group of Senators this week passed off the Senate Floor key changes to the new earned sick and safe time (ESST) law. The Senate Bill, which still must pass the House, exempts farms with five or fewer employees from the mandate along with all businesses with less than four employees.

Senate Releases Bonding Framework

The Senate Capitol Investment Committee on Thursday held a hearing on a $1.35 billion Bonding Bill. The proposal, released as a spreadsheet, primarily included initiatives from the Walz Administration along with the University of Minnesota and the MNSCU systems. The proposal did include a $459 million placeholder for local projects but it did not name the projects.

As global trade tensions escalate following the Trump administration’s proposed sweeping tariffs on imports, public companies face renewed pressure to ensure that securities disclosures adequately capture evolving risks. The unpredictability of these developments, combined with their potentially material impact, requires careful evaluation of disclosure practices — particularly in the risk factors and forward-looking statements sections in their quarterly and annual reports.

Although many calendar year issuers updated their Form 10-Ks to address tariff concerns earlier this year, the scope and detail of the administration’s tariff plans have sharpened since then.  Companies directly exposed to global supply chains or importing significant product volumes should assess whether subsequent quarterly reports on Form 10-Q merit further updates. This includes not only risk factors disclosures, but also disclosures in the Management’s Discussion and Analysis (MD&A) section, where known trends and uncertainties must be discussed.

Private companies planning initial public offerings or public companies contemplating equity financing issuances should anticipate similar challenges, as registration statements will be scrutinized for sufficient disclosure regarding tariff exposure and the potential impact on the results of operations and financial position. General Counsel and Investor Relations teams should also prepare for heightened investor and analyst focus on tariffs during earnings calls, which may demand careful messaging to avoid misstatements and mitigate litigation risks.

While the SEC has not issued specific guidance on tariff-related disclosure to date, prior guidance on recent macroeconomic events, including guidance on COVID-19 and Russia’s invasion of Ukraine, have stressed the importance of reliance on robust disclosure controls and candid communication about all relevant risks, both actual and potential. Companies are well-advised to avoid innovating or minimizing these risks and instead adhere to established disclosure frameworks designed for volatile and uncertain conditions.

Below is a “mini-checklist” that General Counsel and CFOs can use to begin thinking about how to frame risk exposure to tariffs in their upcoming SEC filings:

• Risk Factors:
  • Assess Material Changes: How have tariffs impacted your existing risk factors?  If there are material changes to any of the existing disclosures, revise them to reflect the new post-tariff commercial landscape.
  • Avoid Hypothetical Language: Have tariffs already impacted the company?  If so, frame your disclosures around actual, materialized events rather than potential risks.
  • Tailor Disclosures: Ensure risk factors are specific to the company’s circumstances, detailing how tariffs affect operations, supply chains, or financial performance.
  • Consider Indirect Impact: Other than direct risk exposure, what types of indirect or “second-level” impact could tariffs have on the company’s operations, employees, assets, or other investments in the affected countries?
  • Don’t Forget About Governance: Separate and apart from financial disclosures, how might new and future tariff policies impact governance and management processes?  Has the board’s role in risk oversight changed? Have new committees of the board of directors been formed? Have new management positions been created and, if so, how might that impact your exposure to key employee retention risk?
• Management’s Discussion and Analysis (MD&A):
  • Discuss Known Trends: Address how tariffs have impacted or are expected to impact the company’s financial condition, results of operations, and cash flows.
  • Operational Adjustments: What changes have been implemented in sourcing, manufacturing, or pricing strategies in response to tariffs?
  • Forward-Looking Information: What are management’s expectations regarding how tariffs will affect future performance, including potential mitigation strategies?
• Financial Statements:
  • Evaluate Accounting Implications: Consider whether tariffs have led to impairments, changes in inventory valuation, or other accounting adjustments that should be reflected in the financial statements.
  • Subsequent Events: Determine if tariff-related events occurring after the balance sheet date require disclosure as subsequent events.
• Earnings Releases and Calls:
  • Consistent Messaging: Ensure that public statements about the impact of tariffs are consistent with prior disclosures in SEC filings to avoid misleading investors.
  • Cautionary Language: Use appropriate cautionary statements when discussing forward-looking information related to tariffs.  How should your safe harbor language in the forward-looking statements disclaimer be updated to reflect tariff-related risks?  To the extent possible, ensure consistency in these disclaimers across previously filed 10-Qs, 10-Ks, and investor presentations.

We are assisting our clients across industries to evaluate disclosure adequacy, develop risk disclosure language, and prepare for stakeholder communications. Feel free to reach out to us if you need help developing customized, tailored disclosures for your SEC reports.

State of Affairs

With the constitutionally-mandated end of session just over two weeks away (Monday, May 19), much work remains to be done in order to pass a two-year budget. The first conference committee appointments have just been made, but no conference committees have even had an opportunity to schedule a meeting yet, and several bills have not yet passed off both floors. Further, a global budget agreement has yet to be made between the Governor and leaders from the House and Senate. Until that happens, conferees won’t be able to make final decisions on their budgets. Tax and bonding bills remain elusive, with neither body releasing one as of today. If the legislature fails to pass a complete budget by Midnight on May 19, a special session will have to be called to complete the work. Minnesota’s current budget expires on June 30, and if there is no budget in place at that time, Minnesota will face a government shutdown. There is still a path to avoid a special session, but time is starting to run short.

Education and Workforce Bills Highlight Difficulties

As the tied House of Representatives has passed most budget bills, many committee co-chairs have acknowledged that the bill would have looked very differently if left to their own devices, however the co-chairs were able to work together effectively to pass a bipartisan bill. Despite this cohesion, some bills have stumbled. After passing out of both the Education and Ways and Means committees, DFL members of the Rules Committee initially refused to calendar the education omnibus bill earlier this week, explaining that their caucus needed more time. The bill has since been calendared (it is scheduled for the floor on Monday), but it serves as a good reminder that a tied House can prove difficult to navigate. Likewise, after only being released last night, the House Workforce and Labor Omnibus bill was pulled from today’s Ways and Means agenda with no explanation or timeline for future action.

Earned Safe & Sick Time Changes

A bipartisan bill to make modest changes to Minnesota’s new Earned Safe and Sick Time (ESST) law has made its way to the Senate floor. S.F. 2300, authored by Sen. Judy Seeberger (DFL-Afton), would, among other minor changes, make adjustments to the effect on employers who offer a more generous leave policy. A key provision to limit the application of the law on small businesses of a certain size was removed at the last minute in the Rules Committee. The law currently affects all businesses with more than one employee, and the Seeberger bill would not change that.

Heintzeman Wins Special Election

Republican Keri Heintzeman of Nisswa won the Tuesday, April 29 Special Election for Minnesota Senate District 6 with 60.27% of the vote. In this strongly Republican-leaning district, she easily defeated DFLer Denise Slipy, who received 39.59%. The special election was prompted by the resignation of former Republican Senator Justin Eichorn, who stepped down in March following his arrest in a Federal sting operation related to the attempted solicitation of a minor. Senate District 6 encompasses parts of Cass, Crow Wing, and Itasca counties, including cities such as Brainerd, Grand Rapids and Nisswa.

Craig Jumps into U.S. Senate Race

Democratic U.S. Representative Angie Craig announced on Tuesday that she intends to run for the U.S. Senate Seat being vacated in 2026 by incumbent Democratic Senator Tina Smith. Craig joins Lieutenant Governor Peggy Flanagan and former State Senate Minority Leader Melisa Lopez Franzen in vying for the DFL endorsement. Craig’s run could open up a competitive race for her 2nd Congressional District seat. Former DFL State Senator Matt Little has already announced his candidacy and State Senator Matt Klein (DFL-Mendota Heights) is expected to announce his candidacy in the next few weeks. Former Minneapolis DFL Vice Chair Mike Norton has also said he plans to run for Craig’s seat. On the Republican side, Craig’s two-time Republican opponent Tyler Kistner is expected to announce that he will run for the seat. Several other prominent names, including current legislators, are also rumored to be considering a run.

It’s All Budget Bills

Following a weeklong break for Passover and Easter, the legislature is back to work and quickly moving omnibus bills through the legislative process. Finance committees had to pass their two-year budget recommendations before break. This week, those bills have been passing through the Senate Finance Committee and the House Ways and Means Committee, with each body even passing a handful of them off the floor. The expectation is that budget bills will be mostly passed out of each body a week from now, allowing conference committees to start meeting and negotiating a final budget.

With the tied House of Representatives, there are a few budget bills that have not yet been agreed to by both co-chairs. Those committees passed a shell bill to Ways and Means, and once the co-chairs have an agreement, they will meet in their committee of jurisdiction to walk through the bill, take testimony, and entertain possible amendments. After that, the language that is agreed to by the committee will be amended into the bill waiting in Ways and Means. Bills that have not been agreed to include the Health and Workforce Development bills.

Governor Delivers State of the State

Governor Tim Walz delivered his State of the State address on Wednesday of this week to a joint session of the House and the Senate. In a speech that lasted less than 30 minutes, the Governor touted his accomplishments for the last six years, took President Trump to task for “chaos” in Washington, D.C., and implored Republican legislators to collaborate with him to balance the state budget.

Governor Walz characterized his biennial budget proposal as protecting past ambitious investments “by embracing a spirit of responsibility and addressing some long-term budget challenges so that future leaders don’t have to make impossible choices.” In the GOP response, Republican leaders reminded the media that DFLers “squandered” an $18 billion surplus and then pledged to work with the Governor and DFL legislators to balance the budget without raising taxes.

Elon Musk’s X Sues Minnesota Over Deepfakes Law

Elon Musk’s social media company, X (formerly Twitter), has filed a federal lawsuit against Minnesota, challenging the constitutionality of the state’s 2023 law that criminalizes the dissemination of AI-generated deepfakes intended to influence elections. Minnesota’s law prohibits the knowing distribution of deepfakes within 90 days of an election if the content is intended to sway the election outcome or damage a candidate’s reputation.

In its lawsuit, X contends that the law infringes upon First Amendment rights by being overly vague, leading to potential over-censorship of protected political speech. The Minnesota Attorney General’s Office has acknowledged the lawsuit and stated that it is reviewing the complaint.

Special Election to Fill Eichorn Seat

The Minnesota Senate District 6 special election is scheduled for Tuesday, April 29 to fill the vacancy left by Republican Justin Eichorn, who resigned on March 20 following his arrest on federal charges related to attempting to solicit a minor for sex. Republican Keri Heintzeman of Nisswa secured the GOP nomination by winning 46.77% of the vote in a crowded primary field of eight candidates in an April 15th Primary. DFLer Denise Slipy of Breezy Point ran unopposed in the DFL primary.

Lots of Effort, Little to Show

Members of the Minnesota House of Representatives have already introduced 3,250 bills as of today. This is despite the fact that the House started weeks late, and the first bills weren’t officially introduced until February 6. The Senate has introduced a slightly higher number of bills—3,445 bills as of today. Adding these together, 6,695 bills have been introduced. Why is this interesting? On April 22, just the fifth bill of legislative session was presented to the Governor for his signature. A list of the bills presented to the Governor can be found here.

Deadlines!

It has been a busy week at the State Capitol. In both the House and Senate, committees raced to meet the first and second bill deadlines of Friday, April 4 (collectively), while finance committee chairs in both bodies met behind closed doors to work on omnibus finance bills. The Senate DFL majority released budget targets last Friday, March 28, and the Republicans and DFLers in the tied House released agreed-upon targets a day later. A comparison of these targets can be found here.

Data Center Update

A new data center bill was introduced in the House, H.F. 2928, establishing new regulatory requirements for the siting and operation of large-scale data centers in this state, including provisions governing water use, energy use and cost allocation, and environmental review. The bill also requires data centers to pay an annual fee, to be used for weatherization and energy conservation programs in low-income households. Rep. Patty Acomb (DFL–Minnetonka), the bill’s author, said the bill was shaped by similar laws enacted in Indiana, Nevada, and Texas, and reflected lessons learned by Virginia from its more “hands-off” approach. The bill was laid over for possible inclusion in an omnibus energy bill.

Social Media Tax Proposed

 As Minnesota faces a looming budget deficit, Senate Tax Chair Ann Rest (DFL-New Hope) is proposing a new tax on social media companies (S.F. 3197) to raise additional revenue. Though the Minnesota Department of Revenue estimates the tax would only impact 15 companies, many businesses worry that they may be inadvertently caught up in the legislation. Others worry that as technology changes over time, the lines between social media companies and others may become nearly indistinguishable and that they may face a new tax liability. House Republicans continue to argue that the state should not impose new taxes this year. Stay tuned for additional updates.

Upcoming: Budgets, then Break

In both the House and Senate, committee budgets will likely be released as early as this weekend, as each must be passed out of their respective committees by noon on Friday, April 11. Passage of the Senate bills seem simple at this point as compared to the House, where Republican and DFL co-chairs must quickly find agreement. Following committee passage of the omnibus finance bills, a legislative break will begin. There will be no committee meetings or floor session from noon on April 11 until noon on April 21. Pending any surprising news, our weekly “Top 5” updates will also be on break during that time.

Special Session Talk Expands

 While many have speculated that a special session may be needed to finish the budget-making process this year, conversations have also begun on the potential need for a late summer or fall special session to address funding needs brought on by changes at the federal level. Cuts to various agencies and programs could bring about such activity, most notably with respect to the potential cuts to the Medicaid program.

Key Development: FinCEN Limits CTA Reporting to Foreign Entities — For Now

On March 21, 2025, the Financial Crimes Enforcement Network (FinCEN) issued an interim final rule (IFR) that significantly narrows the reporting requirements under the Corporate Transparency Act (CTA). Under the IFR, only foreign entities registered to do business in the United States are required to report beneficial ownership information (BOI) to FinCEN.

FinCEN accomplished this by revising the current regulation and removing the term “domestic reporting company” from the definition of entities required to report and instead placing domestic entities within the list of exemptions. The result is that U.S.-formed companies (e.g., corporations, LLCs) are now, according to FinCEN, excluded from the CTA’s reporting obligations.

Statutory Conflict: Why Uncertainty Remains

Although FinCEN has issued this regulatory change, the underlying statute—the Corporate Transparency Act—was not amended and still explicitly requires reports from domestic reporting companies. FinCEN’s rule contradicts the statute and creates uncertainty; there is a likelihood of legal challenges to this reinterpretation—particularly in an environment where courts are no longer required to defer to agency interpretations that contradict clear statutory text. In other words, the IFR does not override the law enacted by Congress. Accordingly, its effort to exempt domestic entities may be struck down by the courts.

Our Recommendation: File If Prepared, Monitor If Not

Given this uncertainty, we believe it is prudent for businesses to consider the risks of noncompliance with the CTA, particularly if they have already incurred costs collecting beneficial ownership information.

• If you have already gathered BOI and are ready to file, we recommend moving forward with filing. It may help avoid future penalties if the IFR is overturned or revised.
• In addition, you may elect to wait and monitor legal developments—but do so understanding the current conflict between the CTA and the IFR

Current Reporting Landscape: Foreign Entities Must Still Comply

FinCEN’s interim final rule redefines “reporting company” to include only foreign entities formed under the laws of a foreign country and registered to do business in a U.S. state or tribal jurisdiction.

These entities must still comply with the CTA and meet updated filing deadlines:

• Foreign entities registered before publication of the rule must file their BOI reports within 30 days of publication.
• Foreign entities registered after publication must file their BOI reports within 30 days of effective registration.
• FinCEN has confirmed that U.S. persons do not need to report BOI, even if they are beneficial owners of a foreign reporting company.

What Should You Do Now?

• Domestic companies: While FinCEN’s rule says no reporting is required, the statute suggests otherwise. If you are prepared, filing may reduce risk. If not, continue to monitor the legal landscape closely.
• Foreign companies: You must comply with the revised BOI reporting rules and deadlines unless you qualify for a specific exemption.
• Everyone: Be aware that this interim rule may change again following public comment or future litigation.

Key Takeaways

• FinCEN’s interim rule excludes domestic companies from CTA BOI reporting, but the statute still says otherwise.
• Legal challenges are expected, and a future ruling could reinstate domestic reporting requirements.
• We recommend filing for domestic entities that are ready, especially those that have already invested in compliance efforts.

Need Assistance? Contact our team for tailored guidance on your CTA reporting obligations or to assess your risk exposure in light of recent developments.

Please note that the firm will not monitor compliance, file beneficial ownership reports, or report changes to beneficial ownership unless expressly agreed to in writing.

We encourage those who may be subject to the CTA to engage a corporate compliance services provider experienced in FinCEN reporting. Please contact your Winthrop attorney or other legal counsel for referrals.

Governor Revises Budget

On March 21, Governor Tim Walz released a revised FY 2026-2027 biennial budget, which incorporates the impact of the latest budget and economic forecast released on March 6. The revised budget includes just under $250 million in budget reductions that carry over into FY 2028-2029. Also included were small, primarily one-time investments related to Avian Influenza and law enforcement training. The Legislature will now need to shift its focus to the budget, with only two working weeks left until their April 11 deadline for budget bills to be finalized by committees.

Senate Releases Budget Targets

The Senate released budget targets today. The budget target spreadsheet lists general fund net spending numbers by each major budget area. The House has not yet released its targets.

Special Election Scheduled

Following last week’s resignation of Senator Justin Eichorn, the Governor has called a special election to fill the now-vacant Senate District 6 seat. Candidates have already begun filing and may continue to do so until 5:00 p.m., April 1. If needed, a primary election will be held on Tuesday, April 15, with the special election taking place on Tuesday, April 29. The new member will likely be seated on Monday, May 5. To date, five Republicans and one Democrat candidate have filed for the seat.

Walz Calls Workers Back/Unions Push Back

Earlier this week, Governor Tim Walz called for most state agency employees to return to the office at least 50% of the time beginning on June 1, with an exception for those who live at least 75 miles away from their primary work location. St. Paul Mayor Melvin Carter indicated that he and the Governor had been discussing the return to work of state employees for months and that the return of employees to the city on a regular basis would be extremely beneficial for the struggling downtown. However, unions that represent the affected workers expressed surprise and dissatisfaction with the announcement. Bart Anderson, Executive Director of AFSCME Council 5, stated that “we will not tolerate unilateral changes to our members’ work,” and Megan Dayton, President of the Minnesota Association of Professional Employees (MAPE), didn’t rule out the possibility of a strike.

State of the State

Governor Walz and legislative leaders have agreed on a date and time for the Governor to deliver his State of the State Address. Members of the legislature will convene on Wednesday, April 23 at 7:00 p.m. in the Minnesota Capitol for the update. While the Governor of Minnesota does typically deliver a state of the state address, both the timing and location of the event are very flexible and vary from year to year.

Legislature Reaches Full Complement—

For about three days this week, all 201 legislative seats, 134 House members and 67 Senators, were filled for the first time in 2025. The week began with David Gottfried, the winner of the 40B special election, being sworn into the House on Monday. Gottfried’s swearing in brought the House to a 67-67 tie and triggered the Power Sharing agreement between House Republicans and DFLers signed on February 5. Under this agreement, the DFL was restored to parity on all House committees, except the Fraud Prevention and State Agency Oversight Policy Committee, and committee gavels began rotating between Republican and DFL Committee Chairs.

—But Only for a Few Days

While the week began with a new member of the Legislature, it ended with the resignation of another. Senator Justin Eichorn (R-Grand Rapids) was arrested in Bloomington about two hours after Rep. Gottfried was sworn in. He has been charged in federal court with attempted coercion and enticement of a minor after he allegedly tried to solicit sex from a 17-year-old girl who turned out to be an undercover Bloomington police officer. Sen. Eichorn resigned approximately an hour before the start of Senate floor session on Thursday in which the Senate was poised to vote to expel him. With Eichorn’s resignation, the DFL holds a two-seat majority, 34-32. There is no word yet on when a special election to replace him will be held.

Governor Walz Townhall Tour (and a Supplemental Budget)

For the past week, Governor Tim Walz has been travelling to other states holding townhall-style meetings in Republican Congressional districts where the respective member of Congress is not holding townhalls. Minnesota Republicans and the media have been quick to criticize him—Republicans stating that he should be more concerned about taking care of Minnesota, and the media wishing that he would hold media availability in Minnesota. Both will get their wish, as Gov. Walz is set to release his supplemental budget proposal today and will hold his first townhall since being elected Governor on Saturday in Rochester.

High Number of Hopeful Cannabis Licensees

Over the weekend, the Office of Cannabis Management (OCM) closed the application window for the first round of licenses, including both social equity and general license applications that were submitted in the past month. Between the 10 license types available, OCM received more than 2,000 applications, including 1,322 applications for microbusinesses. While four of the license types have caps on the overall number of licenses that can be granted, the microbusiness license, which allows for a vertically integrated business from seed to sale, is not capped. The legislature continues to consider legislation to tweak the fledgling industry.

Calendar Reminders

With just two weeks remaining before the first and second committee deadlines, we thought a reminder of important upcoming dates would be helpful:

• March 29-31: Legislative Break, Eid
• April 1: House plans to release budget targets by this date
• April 4, 5:00 p.m.: First and Second Committee Deadline (Policy)
• April 5: Senate plans to release budget targets by this date
• April 11, 12:00 noon: Third Committee Deadline (Major appropriation and finance bills)
• April 12-21: Legislative Break, Passover and Easter (Break ends at noon on Monday, April 21)
• May 19: Last day of the legislative session
• July 1: Government shutdown begins if new budget isn’t enacted