Minnesota Legislature approves bill to address 2021 drought, fund broadband infrastructure

As the Minnesota Legislature struggled on Sunday to break a stalemate over billions in proposed spending and tax cuts ahead of an 11:59 p.m. deadline to adjourn the 2022 session, lawmakers did manage to resolve two thorny disagreements.

The DFL-led House and Republican-led Senate passed a bill that directs $18.4 million to address drought and disaster relief, mostly for livestock and specialty crop farmers hurt by the 2021 dry period. The bill also includes $110 million to help build high-speed internet infrastructure. Gov. Tim Walz is expected to sign the measure.

“This bill does the biggest investment in state history in rural broadband,” Sen. Torrey Westrom, an Elbow Lake Republican who chairs the Senate’s Agriculture and Rural Development Finance and Policy, said on the Senate floor Sunday evening.

A deal on drought relief

A deal on drought relief had eluded lawmakers since at least the fall of 2021. After a year that left much of the state in severe or extreme drought, there was a consensus among legislators and Walz that Minnesota should step in to help those most impacted.

That included livestock farmers who faced problems growing feed or higher prices for buying it. The drought also hit specialty crop farmers who grow things like produce for farmers markets. Neither can rely on traditional crop insurance the same way as farmers who grow commodities like corn and soybeans.

Legislators at the time had a general agreement to spend roughly $10 million, and many hoped it would pass in a special legislative session before they were set to convene in late January. But after Senate Republicans threatened to oust health commissioner Jan Malcolm, Walz decided not to call that special session.

When the Legislature did convene, key lawmakers said they were optimistic drought relief could be passed quickly. And they said fast action was urgent to help farmers in dire straits.

But the bill stalled. House Democrats tied the $10 million in farmer drought relief to a $13 million plan to replant drought-affected forests, plant shade trees and fund water conservation projects. 

Senate Republicans were skeptical of the new provisions, and they in turn tacked on separate funding — unpopular with Democrats — meant to help deer farmers impacted by regulations that seek to limit the spread of chronic wasting disease. The Senate GOP withdrew the money for deer farms, but the DFL insisted on their money for other drought provisions sought by the Department of Natural Resources.

The final deal includes $8.1 million for livestock and specialty crop farmer aid, $2.5 million for drought relief loans and $5.3 million for drought-killed seedlings. The money for shade trees and water efficiency projects is not part of the bill. A small amount of money was included for animal disease testing equipment as the state faces chronic wasting disease, the avian influenza outbreak and more.

The legislative deal will help with “expenses that farmers faced having to buy extra forage, bring it in from further away, or find ways to get their livestock fed or deal with the specialty crops that they raised and the loss that they had,” Westrom said.

Some at the Capitol grumbled about the final agreement. State Rep. Nathan Nelson, R-Hinckley, said on the House floor late Saturday that the deal was “too little too late for many.” And he emphasized the “late” part. The negotiations stretched so long that farmers like him aren’t facing drought conditions any longer.

“Ironically it’s too wet for me to plant,” Nelson said. “We’re on the 21st of May, I’ve yet to put a seed in the ground.”

But in a statement, Rep. Mike Sundin, a Democrat from Esko who chairs the House Agriculture Finance and Policy Committee and helped broker the drought deal, said the bill was a good compromise. “We’ve heard from farmers in our state who are facing some challenges, and they’re counting on us to come together to improve the outlook for Agriculture in Minnesota well into the future,” Sundin said.

The impasse over broadband infrastructure wasn’t as lengthy but it was at times heated.

Minnesota is expecting a windfall of federal money for broadband, but little of it has materialized yet. The Legislature in 2021 approved $70 million for the state’s border-to-border program that subsidizes developers to build in rural areas, where it would otherwise be too costly. 

That money came from a $180 million “capital projects” fund within Minnesota’s share of the federal American Rescue Plan, however, and it has been so slow to be finalized by the federal government that the state missed a construction season.

For that reason, and others, the Walz administration pushed for $170 million in state, not federal, spending this year on broadband infrastructure. The Senate GOP proposed using $110 million left in the capital projects fund from the ARP for broadband infrastructure. There has been debate over how to use that $110 million because it can also be used for a few other purposes, like buying devices and equipment to facilitate internet access or certain building projects such as upgrading a library or community health center.

The House DFL, much to the chagrin of the Walz administration and some rural Democrats, officially proposed just $25 million in general fund cash and didn’t release a plan for the capital projects fund.

In the end, lawmakers agreed to spend $50 million in state money over the next three years on broadband grants and approved $60.7 million from the capital projects fund to build or support broadband infrastructure. Walz will decide how to use the remaining ARP capital projects money within the bounds of federal guidelines.

Lawmakers touted the agreement as including $210 million in broadband spending. That counts $100 million already dedicated to Minnesota for broadband in the federal Infrastructure and Jobs Act. But it ensures the money will be used for infrastructure expansion. The feds have outlined several potential uses for the money, including installing wifi in multi-unit residential buildings and the adoption of “digital equity” programs. Unlike the ARP’s capital project fund, however, there was little debate over broadband money from the federal infrastructure bill at the Minnesota Capitol this year.

More than 240,000 households currently lack access to a connection that meets state standards. Walz officials estimate meeting the state’s 2026 goal for adequate broadband will cost $1.3 billion, with most of that money coming from the state.