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Capitol Update | Tuesday, April 5, 2022

4/5/2022

 
The Big Picture  With only seven weeks to go until adjournment, our divided legislature continues to be far apart on how to best use the historic $9 billion surplus to hasten the economic recovery and to address our state’s needs.  There is increased speculation that the parties may not reach agreement and may leave much of the surplus until next year.  Given that 2022 is not a traditional budget year, the legislature technically does not have to pass finance bills or spend the surplus.   Our continued advocacy work this session is centered around two principles:
  1. Operators are not in a position to take on new cost burdens from the State in 2022; and
  2. The recovery of the industry and the economy would be hastened by economic stimulus now.

Unemployment Insurance Trust Fund  Despite early statements of support from both Senate republicans and the governor to address the $2.7 billion needed to repay the federal government and refill the Unemployment Insurance Trust Fund, resolution has been elusive.  While the Senate has already passed the bill by a wide bipartisan margin, House democrats continue to hold out for agreement on frontline worker pay beyond the $250 million agreed to last session.  We continue to work with a coalition of business organizations to push for resolution of the UI Trust Fund ASAP and block significant payroll tax increases.

Take Action:
  • Contact your representative and ask them to demand a vote on replenishing the UI Trust Fund.

Restaurant Revitalization Fund Tax Free  Our work at the Minnesota Legislature is paying off as yesterday our bill making Restaurant Revitalization Funds tax free was included in the release of both the House and Senate Omnibus Tax bills.  We have testified in multiple committees and engaged you as members in direct action to get to this point.  Thank you for going to bat!  The bills also includes conformity on the EIDL loan advances and the Shuttered Venue Operators Grant that was part of our advocacy efforts.
Left to right: Rep. Paul Marquart (Dilworth), Chair, House Tax Committee; Sen. Carla Nelson (Rochester), Chair, Senate Tax Committee;
​and Lead Authors Rep. Dave Baker (Willmar) and Sen. Karla Bingham (Cottage Grove)
Take Action
  • Send a quick note to the chairs of the House and Senate Tax Committees to thank them for including this critical provision. Contact Rep. Marquart.    Contact Sen. Nelson.​
  • Let our bipartisan lead authors know you appreciate their efforts to advance the bill.  Contact Rep. Baker.  Contact Sen. Bingham.

Push to Replenish the Restaurant Revitalization Fund  The US House, and perhaps the Senate, are expected to vote to replenish the Restaurant Revitalization Fund (RRF). Lawmakers need to hear stories from constituents about the crucial need for this additional relief.
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Take Action
  • Participate in the National Restaurant Association's grassroots activation campaign to help generate strong bipartisan support for the RRF.

Online Hospitality Workforce Training Program  Despite our bipartisan bill receiving a positive senate committee hearing and passing two House committees unanimously, HF3550/SF3771 was surprisingly not included in either the House or Senate Omnibus Bills released yesterday.  Late yesterday, we testified before the House Workforce Committee, asking for reconsideration of our bill, which would create an online hospitality training program modeled on South Dakota's offering.
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Watch Our Testimony
Check Out the South Dakota Program
Take Action
  • Contact the committee chairs Rep. Noor and Sen. Pratt and ask them to include HF3550/SF3771 in the Ominbus Jobs/Workforce bill.
    • ​Send them our Issue Brief.
    • Remind them the bills is supported by:
  • Minnesota Chamber of Commerce
  • MN Tourism Growth Coalition
  • MACVB
  • Visit St. Paul
  • Meet Minneapolis
  • Minneapolis Regional Chamber
  • Brainerd Lakes Chamber
  • ​Rochester Area Chamber
  • Duluth Area Chamber
  • Visit Mankato
  • Greater Minneapolis Hotel Association
  • MLBA
  • Minnesota Craft Brewer’s Guild
  • Additionally, you might reach out to the other committee members on the House Workforce Committee and Senate Jobs committee and ask them to go to bat for HF3550/SF3771.

Hospitality Grant Relief  As we reported last week, Rep. Sandstede (Hibbing) proposed $100 million in grants (up to $25,000) to certain hospitality businesses impacted by COVID.  The House Omnibus Bill released yesterday pared the relief back to $35 million.  Late yesterday, we testified before the committee to request the program be significantly expanded (both in size and scope) and that it include hotels in need, as well.  The Senate Omnibus Jobs bill thus far does not include grant relief for our industry and is limited to only $6 million in total new spending compared to $387 million in the House proposal.  
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Watch Our Testimony
Take Action
Contact the committee chairs, Rep. Noor and Sen. Pratt and ask them to include significantly expanded grant relief for hospitality businesses in need.  You can remind them that Wisconsin has passed over $900 million in small business direct grant relief (compared to Minnesota’s $345 million), including $93 million for hotels.  Minnesota can do better by businesses hit hard by the pandemic.

Open Wholesale on Liquor  This session we have been working with a coalition to ensure open wholesale on liquor.  As we reported last week, the courts have ruled the “Coleman Act” unconstitutional due to its “discriminatory treatment” of out-of-state producers.  This means that if the legislature does not act to create true open wholesale for all parties, giant out of state distributors will be permitted to use exclusive contracts, likely driving up cost for purchasers of spirits such as our members, and potentially creating further supply chain issues.  Thankfully, the judge in the case delayed the effect of the ruling for 60 days, giving the Legislature time to act.  While the senate bill has been passed to the floor, the house version awaits action in the Ways and Means committee.
Read Our Coalition Brief​
Take Action
  • Contact your legislators and urge them to pass SF3008/HF2767 this session.

Property Tax Relief  Hospitality Minnesota supports the elimination of the state property tax levy.  While last session we won an incremental victory by raising the property value exemption, there may be an opportunity to further this work this session.  Sen. Nelson (Rochester) has a bill to repeal the tax and is the senate tax chair.  While the business community has been focused on UI so far this session, there may be additional opportunities to advance business property tax reform later this session.  We have met with both tax chairs on our position and will continue to monitor the situation for opportunities. 
Read Our Issue Brief  

Sales Tax Exemption on Restaurant Equipment  Building on momentum from last session, we have pressed hard for inclusion of this long-term priority this year.  The House Omnibus Tax bill revealed yesterday does include our bill, authored by Rep. Baker (Willmar).  The current Senate Omnibus Tax bill does not include our bill, however, meaning there is more work ahead.
 
Take Action
  • Contact Chair Marquart (Dilworth) and thank him for including this critical provision and contact Rep. Baker (Willmar) and thank him for authoring the bill.
  • Contact Chair Nelson (Rochester) and the Senate Tax Committee members and ask them to include SF1318/HF921 in the Omnibus Tax bill.

​Explore Minnesota Tourism Funding  Hospitality Minnesota is part of a coalition seeking additional funding of $6 million to EMT for economic recovery grants.  The recently released Senate Omnibus Environment committee does not include this provision, but instead directs $1.45 million to EMT to promote large scale sporting and other events.  The House Omnibus Environment bill includes our ask, but also raises the investment to $10 million.  We will be monitoring this closely as it moves to conference committee.
 Read Our Issue Brief
Take Action  
  • Contact Chair Hansen (South St. Paul) and thank him for including $10 million in EMT funding and thank the bill authors, Sen. Ruud (Breezy Point) and Rep. Christensen (Stillwater).

​New Hotel Regulations  As we have reported previously, legislation creating an additional and unnecessary bureaucratic licensure structure at the city/town level over hotels (and potentially resorts) was passed to the House Floor.  We have been in contact with the Senate committee with jurisdiction over the bill and submitted a letter to key players and the author.  The Senate committee has not heard the bill to date.  We are closely monitoring the State Government Omnibus bills to see if it is added as an amendment in the coming weeks and will act accordingly.
​Read Our Letter to Legislators

​Border/BWCA Closure Assistance  Legislation supported by Hospitality Minnesota to provide $7.5 million in grants to small businesses impacted by the closures of the Canadian border and the BWCA has advanced and has now received a hearing in a Senate committee and is included in the House Omnibus Jobs bill release yesterday.  We testified in support of the measure late yesterday and will continue to advocate for its passage.  The bills are authored by Sen. Bakk (Cook) and Rep. Ecklund (International Falls).  

​Protecting the Lodging Tax  Unfortunately, provisions to redirect the lodging tax for capital projects in Woodbury and to permanently allow redirection in Plymouth have advanced in the House Omnibus tax bill.  We have opposed these measures at every step and will provide additional testimony in the House Tax committee tomorrow.  These provisions are not included in the current Senate Omnibus Tax bill. 
Read Our Issue Brief    

​Resort Spa De-Regulation  A bill to de-regulate spas/hot tubs at resorts (as was allowed for Houseboats several years back) has advanced to the Senate floor and has been included in the Health and Human Services Omnibus bill.  Sen. Bakk proposes the bill would put resorts with stand-alone single unit spa pools in a room or cabin on an even playing field with cabin rentals and/or vacation rentals. In a Senate hearing, HM member Mindy Fredrikson testified that as a resort owner, the current regulations triple the cost of adding a hot tub to a unit (over $60,000 per), putting resorts on an uneven playing field with short-term vacation rentals that are under-regulated or unregulated in this area under current practice. 
Review SF2145
View the Hearing 

​Employer Mandates  While debates around minimum wage and predictive scheduling have been quiet this session, competing proposals on paid family leave have taken shape with democrats favoring a state-run program funded by a new payroll tax (0.6% split between employer and employee) and mandated on all employers. Similar programs have run into varying problems in Oregon, Washington, and New Jersey.  Alternatively, republicans have released a plan that would create tax credits for small businesses seeking to add coverage on the private marketplace.  Hospitality Minnesota supports employers adding competitive benefits packages to their employee offerings, but they must be able to do so on a voluntary basis within their financial ability. 
Read Our Issue Brief

Hotel Fire Marshall Policy Yesterday, we participated in a meeting with the State Fire Marshall Division, which is seeking input on its five-year strategic plan. Participants on the call included representatives from the governor’s office, the Department of Education, Department of Public Safety, Minnesota Management and Budget, educators, assisted living professionals and others. 
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On the call, EVP Ben Wogsland advocated for the Fire Marshall to:
  1. Eliminate onerous fees on hotels for inspections and seek general funding from the state;
  2. Ensure inspection schedules are regular (and not early) so that operators can plan; and
  3. Regulate short-term vacation rentals in the same manner as other overnight accommodations.

​Federal RRF Replenishment  In what may be the final effort to get the Restaurant Revitalization Fund Replenished at the federal level, we expect the U.S. House of Representatives to bring the bill up for a vote as a stand-alone as early as this Thursday. We believe the votes are there to pass the House, but a wide bipartisan total would dramatically improve the chances of Senate passage, which up till now has appeared unlikely (despite both MN senators supporting us).
 
Take Action
  • Contact your U.S. Representative today and ask them to vote to Replenish RRF so that 2,500 small businesses that were left behind can get the help they need.

​New Federal Visa Proposal The National Restaurant Association is supporting a new federal visa proposal that would allow up to 85,000 visa workers to enter the U.S. on 3-year terms on new “H-2C” visa to help fill the workforce shortage in foodservice businesses.
 
Take Action
  • Contact your federal lawmakers and ask them to co-author and support HF7239, the Essential Workers for Economic Advancement Act.

​These are some of the key issues we are tracking and working on at the Capitol and federally. Don’t see something you care about, or want more information?  We are also happy to help you set up meetings with your legislators and provide you with talking points to move our industry agenda forward.  Contact ben@hospitalitymn.com 
 
Want to get more involved?
  • Join the HM Advocacy Group and help set our policy agenda and strategy.  Meeting are once per month via Zoom.  Contact ben@hospitalitymn.com  

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  • Membership
    • What Members Say
    • Join Forms >
      • Operator Form
      • Allied Business Form
      • Tourism Partner Form
    • Login to Renew
  • Engagement
    • Programs and Events
    • Education and Training >
      • ServSafe
      • Sex Trafficking Prevention
    • Volunteer
    • Allied Members >
      • Allied Network
      • Become a Partner
      • Advertise with Us
    • Calendar
  • Advocacy
    • At the Legislature >
      • 2023 Legislative Agenda
      • 2023 Days at the Capitol
      • Capitol Updates
    • Advocacy Action Center >
      • Contact Your Elected Officals
      • Advocacy Group
    • Issue Briefs
    • HOPAC
  • Resources
    • Hospitality Law Review
    • Reports and Guidance >
      • Economic Snapshots
      • Monthly STR Summaries
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