Legislative break marks a crucial moment for Minnesota’s business priorities

By Doug Loon
President and CEO
Minnesota Chamber of Commerce

It’s recess week at the State Legislature here in Minnesota, and legislators are back in their districts meeting with constituents on the issues that matter – both to each district and, of course, to the business community. We want to say thank you to the Legislature for making important progress this year on key issues, including the all-important fiscal budget that still needs to be finalized.

We’re reminded that May 19 is their required adjournment date, and if you do the math, it’s not that far away – just a few weeks. As legislators wrap up their district work period and take a little bit of rest and recovery, we hope they return to the Capitol with a renewed sense of purpose.

We’re watching closely to see how they’ll finish by May 19. There are still key issues pending this legislative session – issues that directly impact the private sector and Minnesota’s economic future. That’s the message we’re sending to legislators while they’re in their districts: costs matter in Minnesota.

Over the past few years, significant new costs have been added in the form of taxes and mandates on Minnesota businesses. To help address this, the Minnesota Chamber – alongside other business organizations and our members – has been advocating for policy changes that alleviate some of those burdens.

A top priority: no new taxes. We’re also calling for a scaling back of the many mandates placed on employers and employees which amounts to about 35 new mandates over the last two years. These mandates come with real costs, often unfunded, meaning businesses and their employees are left to absorb them.

One of the most notable is the Sick and Safe Time Mandate, which has already presented significant challenges. But it also sets the stage for a broader conversation about the upcoming Paid Family and Medical Leave law, which goes into effect January 1, 2026.

As we’ve discussed in previous podcasts, that law includes a 0.88% payroll tax, amounting to about $2 billion annually in taxes on both employers and employees. Yes, it increases leave options for employees, but it also increases costs in a time when workforce challenges are already pressing.

There are a number of improvements and reforms currently moving through the Legislature, and we’re hopeful they will be adopted. Without these fixes and more time for responsible implementation, businesses and workers alike will face higher costs, tax hikes, and what we see as mismanaged benefits that affect Minnesota’s competitiveness.

We’re also continuing our push to improve Minnesota’s environmental permitting process. Important steps have been taken in the Senate, including key reforms advancing in the Senate Environment, Climate and Legacy omnibus bill (SF570).

This progress is thanks to extensive collaboration by our Permitting Reform Coalition, made up of businesses, labor groups, public sector representatives and local chambers of commerce. We’re advocating for practical changes that maintain Minnesota’s high environmental standards while increasing efficiency and transparency.

All of this work builds on the Minnesota Chamber Foundation’s 2024 report, which found the state’s environmental permitting process to be inefficient and lacking in transparency and certainty. The goal is to maintain strong environmental protections while making it easier for worthwhile projects to move forward in a timely way.

With that in mind, we’re asking legislators to continue advancing bipartisan strategies. We also thank those lawmakers from both parties who have already partnered with the business community to make real progress this session. Their leadership shows what’s possible when we work together for Minnesota’s economy.

We encourage employers to reach out to their legislators during these final days of the recess. We look forward to seeing the Legislature return to St. Paul next week as we head into the final stretch of the 2025 session.

Thanks for tuning in. We look forward to connecting with you again on next week’s episode of the Minnesota Business Podcast.