Minnesota budget deal: Walz, lawmakers agree on property tax cuts, HCMC funding

Lawmakers work to save HCMC from closing

The future of Minnesota’s largest safety-net hospital is uncertain as state lawmakers race to prevent Hennepin County Medical Center from shutting down. FOX 9’s Mike Manzoni has the latest details as a session deadline approaches.

ST. PAUL, Minn. (FOX 9) - Minnesota lawmakers and Gov. Tim Walz reached a bipartisan budget deal, which includes investing in HCMC as it faces closure. 

Budget agreement targets core priorities for Minnesotans

Local perspective:

Walz said the new agreement is about "the disciplined, fiscally responsible approach Minnesotans expect." The deal keeps the state budget balanced, makes targeted cuts and directs spending toward fiscal sustainability, infrastructure and community health.

The agreement includes a historic investment in the Hennepin County Medical Center (HCMC), which Walz called "a cornerstone of our health care system and a critical safety net for Minnesotans across the region." He added, "This agreement strengthens Minnesota’s long-term stability, supports the broader health care ecosystem, and reflects the discipline of living within our means while preparing for the challenges ahead."

Lawmakers have been working all session on ways to HCMC from closing due to funding issues. 

Senate Majority Leader Erin Murphy said the Senate DFL caucus worked to address affordability, support healthcare and invest in community infrastructure.

"This was a hard-fought negotiation, and I’m damn proud to say we defended many of our most essential Senate positions, including property tax relief for homeowners and through direct support to counties, and funding to stabilize healthcare at HCMC and critical access hospitals around the state," said Murphy.

The budget also responds to federal funding cuts, with much of the deal "consumed backfilling costs created by cuts from the federal government," Murphy said.

The agreement aims to help Minnesotans statewide afford their lives for years to come, according to Speaker Lisa Demuth. She said, "Our caucus has fought all session long for car tab relief, property tax cuts, and meaningful anti-fraud measures. This budget delivers that, along with help for rural and critical access hospitals across the state and relief for our counties."

The budget deal includes property tax refunds, a reduction in car tab fees and a significant infrastructure bill.

House DFL Leader Zack Stephenson called the deal "a strong bipartisan agreement that saves HCMC, includes a significant infrastructure bill, property tax refunds, and a tab fee reduction." He added, "While this certainly doesn't include everything House DFLers wanted, it is a strong step forward on important issues while working in divided government."

Murphy said, "some of our strongest proposals did not have support across the aisle," but emphasized the Senate DFL caucus will continue to work on solutions in the future.

DFLers and Republicans both highlighted the importance of providing stability for HCMC and supporting rural hospitals, even as they acknowledged compromises were made.

Full statements from Minnesota leaders

What they're saying:

"This agreement reflects the disciplined, fiscally responsible approach Minnesotans expect," said Gov. Walz. "We are keeping a balanced budget, making targeted reductions, and focusing every dollar on core priorities: fiscal sustainability, critical infrastructure, and the health and wellbeing of our communities. At a time of real uncertainty, we are protecting Minnesota’s strong financial position while delivering a historic, bipartisan investment in HCMC, a cornerstone of our health care system and a critical safety net for Minnesotans across the region. This agreement strengthens Minnesota’s long-term stability, supports the broader health care ecosystem, and reflects the discipline of living within our means while preparing for the challenges ahead."

"This was a hard-fought negotiation, and I’m damn proud to say we defended many of our most essential Senate positions, including property tax relief for homeowners and through direct support to counties, and funding to stabilize healthcare at HCMC and critical access hospitals around the state," said Sen. Murphy. "The Senate DFL caucus worked throughout this session to address the affordability crisis, save our healthcare system, invest in community infrastructure and keep food on the table for Minnesotans. This budget deal models those priorities, though much of it is consumed backfilling costs created by cuts from the federal government, and some of our strongest proposals did not have support across the aisle. We got good work done, and will look forward to connecting with Minnesotans after session to prepare ourselves for the challenge we face and solutions we can build next year."

"Our caucus has fought all session long for car tab relief, property tax cuts, and meaningful anti-fraud measures," said Speaker Demuth. "This budget delivers that, along with help for rural and critical access hospitals across the state and relief for our counties. With this budget, we’re delivering on affordability for communities across the state. This will help Minnesotans statewide afford their lives for years to come." 

"This is a strong bipartisan agreement that saves HCMC, includes a significant infrastructure bill, property tax refunds, and a tab fee reduction," said House DFL Leader Zack Stephenson. "While this certainly doesn't include everything House DFLers wanted, it is a strong step forward on important issues while working in divided government. Providing certainty and stability for HCMC was a necessity, and I'm glad we were able to find bipartisan support. DFLers are ready to pass this agreement and complete this work for the people of Minnesota."