Deferred maintenance, affordable housing are reasonable budget priorities for Minnesota

·4 min read

With an estimated $7.7 billion state budget surplus, Minnesota could consider itself lucky headed into what is traditionally the year for bonding work to take center stage at the Legislature.

The surplus gives budgetary elbow room for our elected representatives to rethink how and why the state spends the money it collects from taxpayers. Just like in a personal budget, when there's no extra cushion in the checking account the talks about how to spend are brief. When there's a healthy savings account, options abound.

The talks about what to do with the surplus promise to make the discussions in St. Paul lengthy this year. The fact that it's an election year, with nearly everyone invested in winning votes, will likely complicate matters further.

This week, Gov. Tim Walz proposed a record $2.7 billion state spending plan - $2 billion of it to be financed by selling general obligation revenue bonds. The priorities in his proposal are:

  • Asset preservation, to the tune of $1 billion. "Asset preservation" means work to repair and maintain state-owned facilities.

  • $940 million for climate change projects.

  • General infrastructure projects worth $560 million, including $120 million for bridge replacements, $90 million for road projects and $200 million for water infrastructure.

  • $450 million for affordable housing projects.

We stand by the asset preservation stance we took in 2021: Spend the $1 billion, and here's some context for that opinion: The Department of Corrections alone is estimated to have a maintenance backlog of more than $640 million. Now extrapolate that situation to dozens of campuses, state agencies and other state-owned assets and $1 billion looks like too little to throw at the problem, not too much.

Responsible leaders don't keep putting off critical maintenance projects. Keeping state-owned assets in safe, sound, operating condition might not make for great campaign slogans, but catching up on a tiny sliver of the state's deferred maintenance projects is great stewardship that will save taxpayer money in the future.

Housing is in crisis in Minnesota, with the availability of approachably priced real estate for working families in severe shortage. That affects the employment market, which affects the economy as a whole, which affects Minnesota's quality of life and competitiveness. So this number, too, seems like a reasonable spend in light of the scope of the problem.

While not part of the governor's proposed bonding bill, we are less enthusiastic about his proposal to return some of the surplus to taxpayers through direct payments - not because some of the surplus should come back to us (it absolutely should) but because the amount proposed is token at best.

Note that the record-setting capital spending budget Walz proposes would be mostly funded through bond issues. Minnesota Management and Budget Commissioner Jim Schowalter said the proposed $2.7 billion spend is doable.

“This recommendation is fiscally responsible. It’s within our budget guidelines, within our financial guidelines and it really helps push forward a lot of good projects. It takes care of a lot of deferred maintenance that we really need to take care of,” he said.

So if we can afford a project list that long without dipping into the surplus (much), lawmakers should consider being more aggressive in getting that tax money back from whence it came — to us.

So far, many of the responses to the governor's plan have smacked of common sense. Rep. Dean Urdahl, R-Grove City and ranking Republican on the House Capital Investment Committee, has said he "isn't interested in setting a bonding record." We concur.

And this from Sen. Tom Bakk, I-Cook, who caucuses with the Republicans and chairs the Senate Capital Investment Committee: “If it can’t pass, then I think there needs to be a bipartisan conversation about kind of what’s the number, rather than everyone playing cat and mouse between now and May,” Bakk said. We also concur on this point, although we are skeptical the Legislature will break its last-minute, middle-of-the-night bill-passing habits this year.

The session opens Jan. 31. Now is the time to pay attention and tell your legislator about your priorities.

— This is the opinion of the St. Cloud Times Editorial Board, which includes News Director Lisa Schwarz and Content Coach Anna Haecherl.

This article originally appeared on St. Cloud Times: Affordable housing is a reasonable budget priority for Minnesota

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