Capitol Update | May 13, 2022
Some Victories, More Work to be Done as Session Nears Conclusion
With only 10 days left in the legislative session and a historic budget surplus, legislators remain far apart on numerous policy and finance decisions. Here’s a status breakdown of legislation in-play or concluded affecting our industry; use the the link below to review our legislative priorities for this session.
Unemployment Insurance Fix The biggest bipartisan accomplishment to date is passage of legislation paying back the federal government and the UI Trust fund without spiking payroll taxes on hospitality (and other business) operators. This was a top legislative priority of ours this session. We appreciate the work of Senator Pratt, Representatives Noor and Pelowski, and Governor Walz to get this done and the engagement of all of our members that participated in our calls to action on this.
“Frontline” Worker Pay As part of the UI Trust Fund negotiations, legislators agreed to expand the “frontline” worker pay agreement from last session. The benefits include foodservice and hotel workers (though there are exclusions, including for workers who received 20 or more weeks of unemployment benefits). Employers are required to notify workers of their potential benefits.
The Senate and House positions remain widely divergent on tax policy and there is very real concern about the ability to find compromise in the coming days, potentially jeopardizing policy that could help our industry. Here’s a breakdown of where the two bodies are at on our key issues.
Take Action NOW
Use the messaging in our Issue Briefs linked below to contact the senate tax chair and house conferees for the omnibus tax bill conference committee today and ask them to support our industry by:
Open Wholesale on Liquor This issue impacts any hospitality business that purchases liquor, from small ma-and-pa resorts, to restaurants, bars, and hotels. Last month, the U.S. Federal District Court struck down Minnesota’s “Coleman Act” as unconstitutional. Unless the legislature acts to ensure open wholesale, large-scale out-of-state producers will be able to use exclusive contracts, driving up cost for our members and other retail purchasers. This is a top issue for our industry, and we are working with a coalition to ensure open wholesale for all.
While the Senate passed SF3008 the fix to the Coleman Act unanimously, the House added a variety of additional alcohol policy items to its bill before passing it 85-48. The House version of the bill, summarized by House Research and linked below, expands freedom for craft brewers/distillers to sell their products (in volume and/or container), allows 17-year-olds limited ability to serve alcohol, allows counties to issue liquor licenses to resorts and others and other provisions.
Take Action NOW
Contact the conferees and tell them to pass the Coleman Act fix and help our hospitality businesses!
Workforce and Jobs Proposals As we previously reported, we were disappointed that neither the House nor Senate omnibus jobs bills included our online hospitality training program. This bipartisan legislation would appropriate $275,000 to create an online hospitality training program through the University of Minnesota Tourism Center (in partnership with Explore Minnesota Tourism), modeled after the highly successful program in South Dakota. We have sent a letter asking that the conference committee reconsider including HF3550/SF3771.
Take Action NOW
Contact the conferees today and ask them to invest in much-needed hospitality workforce training by including HF3550/SF3771 in the omnibus jobs bill.
The House workforce/jobs bill also includes a scaled-downed version or Rep. Sandstede’s bill to provide direct grant relief to small businesses impacted by COVID. The current proposal would provide $35M in grants (down from $100M) but is not included in the Senate proposal.
New Hotel/Overnight Accomodation Regulations The House State Government Omnibus bill includes a provision allowing local governments to add new and unnecessary regulatory burden on hotels and overnight accommodations on top of existing state and county licensure. We sent a letter opposing this legislation and are in communication with the senate chair, Mary Kiffmeyer, who has also expressed that she shares our concerns. We continue to work to protect hotels and other overnight accommodations from over-regulation.
Explore Minnesota Tourism Funding Hospitality Minnesota supports an additional $10M in funding for Explore Minnesota Tourism in the House Omnibus Environment bill for tourism industry recovery grants. While the Tourism Growth Coalition (of which we are part) proposed $6M, the House has increased the ask substantially, which we support. The Senate bill does not currently include this provision and instead would direct $1.45M to Minnesota Sports and Events to attract large scale sports and events to the state.
Broadband Expansion The House Agriculture omnibus bill includes a proposal for $25M in new funding for expanding broadband. We have had good success in recent years working with a coalition to expand access to broadband to all four corners of the state and continue to support additional investment that will aid hospitality businesses and guests.
Invasive Species In addition to the $45M investments made last year to prevent and mitigate invasive species, the House Omnibus Environment bill proposes an additional $2.3M ($1.8M to local governments and lake associations to deal with aquatic species and $500,000 for cooperative weed management). Hospitality Minnesota supports an aggressive and comprehensive approach to dealing with invasive species.
Boating Licensure We are monitoring a provision in the House Omnibus Environment bill (and heard in senate committee) to create a license requirement for boat operators in Minnesota. We have relayed some concerns about requirements for resorts and rental operators to enforce the law, in particular a provision that could require them to administer a test to renters even if the renter has already obtained a license or is exempt. The mark-up linked below includes exemptions and requirements of note.
Paid Leave Proposals Hospitality Minnesota supports the ability of operators to offer competitive leave benefits on a voluntary basis within their financial means. The House and Senate have competing proposals on paid leave, with the House passing government mandated benefits funded by employers (and potentially partially funded by employees for family leave). The Senate proposal would incentive purchase of insurance or payment of benefits through tax credits up to $3,000 per worker, rather than mandating a specific benefit package. With only 10 days left in session and the parties so far apart, a deal appears unlikely on this issue this session.
With only 10 days left in the legislative session and wide gaps between the parties’ policy and finance philosophies and positions, the situation is very fluid. Stay-tuned for additional updates and potential opportunities for grassroots engagement in the endgame.
In the meantime, you can contribute to our understanding of the conditions that drive our policy and advocacy work by completing the Q2 Business Conditions Survey.
Want to get more involved? Join the HM Advocacy Group available to all members by contacting Ben Wogsland.
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