INSIDE THE LEGISLATIVE SESSION
Feature
Sen. Steve Drazkowski
Rep. Steven Jacob
DISTRICT 20
DISTRICT 20B
What is an outcome from the 2023 Legislative Session that will have a significant impact on the Rochester area business community? After this session, the Rochester area will be less competi- tive with other midwestern regions. Small businesses and workers will feel the impact of new payroll taxes, new taxes and tax increases, and many other burdensome regulations. The regulatory process will be less transparent because “the trifecta” of DFL control of the legislature and Governor Walz empowered state agency bureaucrats to interpret and enforce new taxes and regulations outside the administra- tive rulemaking process. These are disturbing developments. The Rochester Area sales tax “Good Neighbor” policy of sharing sales tax revenue with small communities outside of Rochester has ended with the new Rochester Sales tax. Res- idents outside of Rochester pay half of the Rochester sales tax. The arrangement ensured that Rochester’s growth did not come at the expense of towns in rural Olmsted, Waba- sha, and Dodge County. It was a model for balanced regional development, which has now come to an end. What is a notable or key accomplishment from the session? The negative impact of this session will be felt much longer than the positive. However, there were a few bright spots. Republicans fought for and gained increased funding for our nursing homes which are on the verge of collapse due to inconsistent reimbursement rates, inflation, and a work- force shortage that has reached crisis levels. Two capital investment bills were loaded with one-time grants to cities and non-profits, spending away the 19-million-dollar state budget surplus of over-collected taxes. There were some im- portant, high-priority infrastructure projects funded for the region, such as road construction, a water treatment plant for the North Zumbro area which can now get underway, and some changes to earlier projects that were required for them to move forward.
What is an outcome from the 2023 Legislative Session that will have a significant impact on the Rochester area business community? Perhaps the biggest change for Rochester, and just about every area’s business community, is HF 2. As of this writing, this bill recently passed in its final form through the House and Senate and will likely be signed into law by the governor soon. It establishes a state program providing 12 weeks for paid family leave, 12 weeks for paid medical leave, and will require this to be adopted for all employers in the state, unless they have equivalent or better benefits. There will be no exception for small businesses. Both workers and employers would be required to fund this program with a new 0.7% payroll tax. Employers will likely see significant difficulties leading up to and after the plan’s implementation, especially for smaller businesses reliant on a smaller number of employees. What is a notable or key accomplishment from the session? I would put forward the Veteran’s finance bill (HF 1937) as a key accomplishment. This was something that wasn’t finished from last session, and I’m happy that we were able to get this done to make sure that Minnesota’s veteran community is taken care of. The House passed this in April, and the Governor signed it recently on May 15th. This has been a long time coming, and even coming in as a freshman legislator, I knew this was something that needed to get done as soon as we could. We managed to craft together a bill that got a bipartisan vote on the House floor. While many other pieces of legislation were pushed through by the majority with little consensus or dialogue, this bill was a happy exception.
8 | ROCHESTER AREA CHAMBER OF COMMERCE ADVANTAGE MAGAZINE — JUNE 2023
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