Walz sets up record $2.7 billion bonding bill; here's what's in it for Central Minnesota

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ST. PAUL — Gov. Tim Walz asked the Minnesota Legislature on Tuesday to back a $2.7 billion bonding plan that's considerably larger than the record package lawmakers passed two years ago.

The Democratic governor unveiled his wish list at a news conference outside the University of Minnesota's Institute of Child Development, which is set to reopen in August after a major rebuild funded by the $1.9 billion bonding package approved by the Legislature in 2020.

Walz used the construction site as a backdrop to highlight how 38% of his proposal, or more than $1 billion, is for asset preservation to maintain and upgrade facilities that taxpayers already own.

“This is your property,” Walz said. “These are assets that belong to the people of Minnesota.”

Gov. Tim Walz, right, and Lt. Gov. Peggy Flanagan tour a construction project at the University of Minnesota where they announced their $2.7 billion plan to bolster infrastructure across Minnesota, Tuesday, Jan. 18, 2022, in Minneapolis. (Glen Stubbe/Star Tribune via AP)
Gov. Tim Walz, right, and Lt. Gov. Peggy Flanagan tour a construction project at the University of Minnesota where they announced their $2.7 billion plan to bolster infrastructure across Minnesota, Tuesday, Jan. 18, 2022, in Minneapolis. (Glen Stubbe/Star Tribune via AP)

Another 21% — more than $560 million — would go to various new public infrastructure projects, including $120 million for local bridge replacements, $90 million for local road improvements and $200 million for local water infrastructure.

Sixteen percent, or more than $450 million, would go toward housing, including projects to combat homelessness. And 10%, or more than $262 million, would go toward the environment, including $190 million for climate change projects.

Public works borrowing packages, also known as bonding bills, are traditionally the centerpiece of Minnesota's legislative sessions in even-numbered years. They're meant to benefit future generations, who help cover the payments.

Here's a look at the Central Minnesota projects Walz recommended.

St. Cloud State University - $4.4 million

Walz recommended $4.487 million for phase one of St. Cloud State University's Education and Learning Design Complex project. The first phase will fund the design of a new School of Education Building and Early Learning Center. It will also pay to design and renovate space for the School of Health and Human Services relocation. The project will eliminate $12.7 million in deferred maintenance once completed.

Graduates walk with their families near Atwood Memorial Center during St. Cloud State University spring semester commencement ceremonies Friday, Aug. 14, 2020, in St. Cloud.
Graduates walk with their families near Atwood Memorial Center during St. Cloud State University spring semester commencement ceremonies Friday, Aug. 14, 2020, in St. Cloud.

Walz also reccomended more that $118 million to repair and replace buildings across the Minnesota State system, of which St. Cloud State University and St. Cloud Community and Technical College are members. Minnesota State’s deferred maintenance needs are estimated to be $1.2 billion.

Department of Corrections - $58 million

The maximum-security Minnesota Correctional Facility-St. Cloud is not directly named in the governor's priorities, but they do include a $58.133 million recommendation for asset preservation to be used across the Minnesota Department of Corrections system. The funding would repair and renew correctional facilities, correcting safety hazards, code compliance issues, perimeter security systems upgrades, tuck pointing, roof replacement, window and door replacement and hazardous materials abatement. The Department of Corrections has an estimated $644 million maintenance backlog.

The Minnesota Correctional Facility-St. Cloud is pictured Thursday, March 18, 2021.
The Minnesota Correctional Facility-St. Cloud is pictured Thursday, March 18, 2021.

What didn't make it in the bonding bill?

The City of Becker requested $4.254 million to prepare a final design, conduct site preparation and acquire right-of-way for construction of an interchange at U.S. Highway 10 and Minnesota State Highway 25. Walz did not recommend capital funding for the project.

The City of Cold Spring requested $182,000 for player safety and viewing experience improvements at the Cold Spring baseball park to replace the halogen light system with energy efficient and wider cast lighting, reducing costs by around 42% and improving visibility for players and viewers. Walz did not recommend capital funding for the project.

The City of St. Joseph requested $5.113 million for trunk sanitary sewer systems infrastructure. The total project includes $10 million in improvements to allow housing, commercial and industrial development off Stearns County Road 2 and adjacent to Interstate Highway 94. Walz did not recommend capital funding for the project.

What's ahead for the bonding bill?

Walz is unlikely to get everything he's seeking from the Legislature, which convenes Jan. 31. His proposal includes $2 billion in general obligation bonds, which require a three-fifths majority in each chamber to pass because they're backed by the state's full faith and credit. That means the final package will require at least some votes from the minority party in both the House and Senate. So bipartisan compromises will be essential. His plan also relies on $730 million from other sources, including $276 million in cash from the state's projected $7.7 billion budget surplus.

Walz said the surplus means Minnesota can afford a big package, and noted that the state's AAA credit rating will help secure low interest rates. Minnesota got interest rates of 4% to 5% on general obligation bonds that it sold late last year.

Minnesota Management and Budget Commissioner Jim Schowalter speaks about the bonding proposal, Tuesday, Jan. 18, 2022, in Minneapolis. Gov. Tim Walz and Lt. Gov. Peggy Flanagan toured a construction project at the University of Minnesota where they announced their $2.7 billion plan to bolster infrastructure across Minnesota. (Glen Stubbe/Star Tribune via AP)
Minnesota Management and Budget Commissioner Jim Schowalter speaks about the bonding proposal, Tuesday, Jan. 18, 2022, in Minneapolis. Gov. Tim Walz and Lt. Gov. Peggy Flanagan toured a construction project at the University of Minnesota where they announced their $2.7 billion plan to bolster infrastructure across Minnesota. (Glen Stubbe/Star Tribune via AP)

Minnesota Management and Budget Commissioner Jim Schowalter said their proposal is “fiscally responsible" because the state can afford to service the debt, so it will preserve the state's high credit rating. He also said it will help address billions of dollars in deferred maintenance costs before that work gets even more expensive.

Democratic Rep. Fue Lee, of Minneapolis, who chairs the House bonding committee, applauded the governor's support for housing and equity-focused projects. Walz earmarked $100 million for projects aimed at Black, Native American and other communities of color that often missed out in previous bonding bills.

“In communities throughout Minnesota, there is an immense need for investment in local projects and resources that bring jobs and opportunities to the region, especially when it comes to investing in marginalized Minnesotans and addressing our state’s housing crisis," Lee said in a statement.

The chairman of the Senate bonding committee, independent Tom Bakk, of Cook, a former Democrat who votes with Republicans on procedural issues, told reporters he hadn't had time to review the governor's proposal because his panel is busy visiting 40 proposed project sites this week. Bakk said the governor's $2.7 billion figure is “way bigger than we've ever done." Bakk said he didn't have a dollar target in mind, but that his priorities are public safety, asset preservation and deferred maintenance.

University of Minnesota President Joan Gabel joined the governor to express gratitude for the $213 million his package includes for asset preservation and other projects at the university. She highlighted the proposed renovation of the undergraduate chemistry teaching lab on the Minneapolis campus. It still has lab spaces that are “almost unchanged” since the 1930s when the science and teaching methods were very different. So, Gabel said, the antiquated labs put Minnesota students at a “significant disadvantage” to those at other universities.

The Associated Press and St. Cloud Times reporter Imani Cruzen contributed to this report.

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This article originally appeared on St. Cloud Times: What St. Cloud-area projects are in Walz's $2.7 billion bonding bill?

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