Governor Walz's Budget Puts Working Families First

Governor Walz has released his budget recommendation today for the next biennial state budget (2022/2023). We applaud Governor Walz for keeping our shared values at the center of this proposal by prioritizing public health investments to recover from COVID, building our economy back better to allow a more prosperous future for working Minnesotans, and investing in our schools and future workforce needs.

Minnesota’s sound fiscal foundation did not come into existence by accident; for the last decade, leadership in the state executive branch has tirelessly advocated and worked to make it a reality. Governor Dayton’s legacy of fiscal stability, strategizing for the long term, and asking the wealthiest to contribute a tiny bit more have made all recent investments possible. Governor Walz wisely carries that legacy on and keeps the torch of fiscal stability burning bright for future generations. Thanks to Governor Dayton and Governor Walz, our state has resources in a reserve account to weather the COVID storm.

Though the Governor’s budget proposal uses money from the state’s reserve account, it also recognizes the importance of having a “rainy day fund” in the future which is why the Governor proposes small tax increases for the wealthiest and those who have benefited most in our current economy. 

·         This budget proposal will build a better economy for working people by expanding the first tier of income tax so more income qualifies for the lowest tax rate; in other words, over 1 million Minnesotans will pay less income tax.

·         The wealthiest are asked to pay a little more by creating a fifth tier income tax rate on any income over $1 million for a married couple or $500,000 for a single person. The increase would be about 1%, but only on income over the $1 million/$500,000 threshold – this only impacts the top .7% of income earners.

·         Additionally, it proposes a 1.5% increase on capital gains and dividend income between $500,000-$1 million and a 4% tax on capital gains or dividend income over $1 million – the middle class will not be impacted by this proposal.

The pandemic is not over and the threat of new, more contagious variants of the virus are emerging. The Governor’s budget proposal continues to prioritize public health by funding COVID testing, contact tracing to contain the spread of variant strains, and robust vaccine distribution efforts. These are all paramount to ensure a speedy and prosperous economic recovery for all workers.

This budget proposal prioritizes recovery from COVID by investing in our kids, our education systems, and future workforce needs. It’s no debate that COVID has impacted our communities differently. While some students have successfully adjusted to learning through the pandemic, many students have fallen behind. Governor Walz said “recovering from COVID is going to take a concerted, deliberate effort” and his proposal to prioritize over half of all of new investments into education is just that. To fully recover from this pandemic we need to make sure our students succeed so the debilitating impacts of COVID are not felt generations later. This budget proposal does that by positioning our future workforce for success.

We are proud to stand with Governor Walz in support of his budget proposal and look forward to creating a more equitable, prosperous future for all.

Julie Bleyhl

Executive Director