As the inimitable Yogi Berra said, “It’s like déjà vu all over again.” The Minnesota State Legislature wrapped up its second special session in the early morning of July 21, after passing notable policing reform. Much like the end of the regular session and first special session, however, there was no deal on bonding or taxes.
Below is a summary of what happened during the 2020 legislative sessions, with a particular focus on MCN’s public policy issue priorities and other significant reforms that MCN supports.
Advancing racial equity through capital investment
Why is it like “déjà vu all over again?” Two pieces of unfinished business at the end of the regular session in May were a bonding bill and a taxes bill. Neither were taken up for a vote. Two pieces of unfinished business for the first special session in May were a bonding bill and a taxes bill. Neither was taken up for a vote. Say it with me now: Two pieces of unfinished business for the second special session in July were a bonding bill and a taxes bill. This time (the second special session) the majority parties in the House and Senate came to an agreement on a bill that combined bonding and taxes, including $1.4 billion in bonding.
That bill, Special Session House File 3, was brought to a vote in the House. The Republican caucus in the House refused to vote for the bill unless there was change to the Governor’s peacetime emergency powers, and a bonding bill needs more than a simple majority to pass, so it was voted down. The Senate did not vote on that bill.
MCN and the Minnesota Budget Project, along with many partners, have been advocating for provisions related to advancing racial equity in Minnesota through capital infrastructure (aka bonding or capital investment). House File 3, which you’ll recall from above did not pass, included an Article specific to equity (a first!). We are very heartened to see that the bill included $30 million to support capital projects from community-based organizations that are led by and serve communities of color and American Indians – a recommendation included in Governor Walz’s budget proposal which we supported. Some of the specific projects that House File 3 included towards that $30 million were Hmong American Farmers Association, Northwest American Indian Center in Bemidji, and the International Institute of Minnesota.
Additionally, that bonding bill included important language requiring projects funded by state general obligation bonds proceeds to comply with human rights provisions related to gender and race equity in hiring, which would create more career opportunities for those individuals who have been historically under-represented in the construction industry. The fact that these pieces were included in the bill negotiated by House and Senate leadership is a good start for the next phase of this work of advancing equity through bonding.
As for the realm of taxes, MCN was advocating for nonprofit-related tax pieces to be included in any tax bill that passed.
House File 3 included an important and common-sense change to the amount of mileage reimbursement subtraction volunteer drivers can deduction from their state income taxes. We have been hearing from nonprofits across the state about issues with low retention of volunteer drivers in part because a portion of the reimbursement is considered taxable income. We joined a coalition of nonprofits, counties, and other associations to educate legislators on this problem and find a fix. That coalition was successful in getting language to fix the problem into House File 3, and we will continue working together to advocate for this fix in 2021 or a future special session.
One important item that was not included in House File 3 was an expansion of Minnesota’s non-itemizer charitable deduction, which had passed the Senate. This expansion would have allowed taxpayers to take a deduction of 60 percent of their total charitable giving after the first $300 (the current deductible amount is 50 percent of total giving after the first $500). Providing Minnesotans greater incentives to give charitably will provide immediate, positive results, supporting our state’s nonprofits in the work they do. We will continue to advocate for this expansion!
MCN supported the policing reform package put together by the Legislature’s People of Color and Indigenous (POCI) Caucus, which would make changes to police training, accountability, and use of deadly force. The compromise package that passed the Legislature includes many important steps, such as a ban on chokeholds in all but extreme circumstances, disallowing “warrior training,” and a requirement than an officer intervene when another officer is using excessive force.
We are grateful for the groundwork on policing reform that nonprofits and other community leaders have laid over the past many years, their persistence and grit, and for the leadership of the POCI Caucus. The POCI Caucus’ original package was a set of first steps, and was significantly watered down in the compromise legislation that passed. We expect to see more discussion, and expect to be supportive of further action, next year.
MCN was the leading voice at the legislature advocating for privacy protections in the presidential primary this past March, and such primary elections in the future. Minnesota recently returned to a statewide presidential primary (as opposed to the one-night-only caucus events hosted by the state’s major political parties).
In order to vote in the presidential primary, Minnesotans were required to state their party preference in order to get the primary ballot for that party. That information was collected, and each voter’s name and party preference is available to the chairs of each of the major political parties. There are no parameters around how the chairs can use or share this information.
We had made enormous inroads on the issue at the legislature to change the law prior to the presidential primary in March. Had there been two more days of session at the Capitol before the pandemic turned everything upside down, we may very well have succeeded. That did not happen, and the issue is much less urgent now since the next presidential primary is not for four years.
MCN was also instrumental in supporting a bill allowing state contracts to nonprofits to be extended if the organization is unable to fulfill its contract deliverables due to COVID-19. The language was included in Second Special Session House File 14, which was never brought up for a vote. Organizations that will not be able to fulfill their contract deliverables due to COVID-19 should work with the appropriate state agency to hopefully extend the timeline for the work.
Unemployment insurance and reimbursing employers
Finally, we continue to educate lawmakers about nonprofits who are reimbursing employers for unemployment insurance claims, and the extremely burdensome bills some of them will soon be facing.
Charitable nonprofits have the option of electing to self-insure rather than paying a regular state unemployment insurance tax. Nonprofits that take this option are known as reimbursing employers, because they directly reimburse the state’s unemployment insurance trust fund for the amount of benefits their employees claim.
We are pushing very hard at the federal level for Congress to increase relief for reimbursing employers, while working to ensure that state lawmakers understand the problem and the state’s potential role in relief, should Congress fail to act. If this is an issue for your organization and you would like to be included in email updates or we can assist your organization in talking to your elected officials about it, please connect with Ileana Mejia, MCN public policy advocate.
Racism declared a public health crisis
During the second special session, the Minnesota House declared via resolution that racism is a public health crisis. MCN agrees that Minnesota needs a coordinated systemic response to dismantle systemic and structural racism, and is continuing to build out our role in that work.
Why the question mark?
All in all, the 2020 sessions have been a mixed bag. This session was a first at MCN for both Marie (public policy director) and Ileana (public policy advocate). We have both so enjoyed getting to know our fellow nonprofit advocates and have appreciated the great advocacy partnerships in the nonprofit sector. We are really looking forward to continuing to work on these issues, to take on new issues, and to work with more members to find out what your organizations are experiencing and how advocacy can support your work.
You may have noticed the question mark in the title of this article. It’s there because it’s unclear whether the 2020 legislative season is indeed over. There may well be a third special session in August, and more after that, as Governor Walz calls a special session each time he extends the COVID-19 related peacetime emergency for another 30 days.
We do not expect to see much, if any, legislation passed during these special session (if they do indeed happen), but to once again quote Yogi Berra, “It ain’t over ‘til it’s over.”
Sign up for our Nonprofit Advocate emails to learn more about our trainings, public policy updates, and more!