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Special Session Looming as Minnesota Lawmakers Work to Complete State Budget

Special Session Looming as Minnesota Lawmakers Work to Complete State Budget

June 2, 2025

The 2025 Minnesota Legislative Session ended on May 19th with lawmakers unable to complete a budget

The 2025 Minnesota Legislative Session ended quietly on May 19th, with lawmakers unable to complete the state’s budget before the constitutional adjournment date. Prior to the adjournment, the House, Senate, and Governor reached an agreement on “joint budget targets.” These targets reflect a top-line agreement between the Legislative and the Governor as to spending and revenue levels for the upcoming budget.

The joint targets provide for a roughly $66.5 billion state budget for Fiscal Years (FY) 2026-2027. This is almost $5 billion less than the last state budget. It calls for a net reduction in spending (as compared to projected expenditures) of $283 million in FY 2026-2027 and about $1.8 billion in FY 2028-2029. Without taking inflationary factors into account, the joint budget targets would result in an estimated $1.9 billion budgetary surplus for FY 2026-2027 and a reduced projected budgetary deficit of about $2.2 billion in FY 2028-2029. The next Legislature will still have additional work to do to fix the dismal budget situation, but the agreement is set to reduce the projected deficit by about 45%.

Following the announcement of joint budget targets, conference committees began work to put together their respective budgets. While a few committees were able to complete their work prior to the adjournment, most budget areas were incomplete as of adjournment. Prior to adjournment, the House, Senate, and Governor signed an agreement that called for all outstanding conference committees to continue to negotiate as informal “working groups,” with the goal of wrapping up the remaining bills in a timely manner.

As of this writing, most of the budget committees have reached agreement as to their respective budget bills, with a few issues still outstanding. Once the agreement is complete and compiled into formal legislation, Governor Walz will call a Special Session with the purpose of passing the agreed upon legislation. The goal is to wrap up the budget early in June to avoid running up against the end of the fiscal year.

 

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