MN county officials criticize Walz’s human services budget, warn of high property taxes

Gov. Tim Walz’s proposed health and human services budget would cut spending by about $1.3 billion over four years and would shift some costs to Minnesota’s counties, causing property taxes to rise, some rural county officials said during a Capitol press conference Wednesday.

Minnesota is spending more money than it’s bringing in and faces a potential multi-billion dollar budget deficit beginning in 2027 if current trends continue.

Walz last month proposed slowing increases on disability services, one of the major drivers of the state’s escalating costs. Appearing with Senate Republicans, the county officials said the burden would fall to counties — and their taxpayers.

“Carlton County … calls on the governor to consider an alternative budget that does not shift the tax burden from the state to local governments, creating a disparate impact on more rural counties, especially,” said Carlton County Administrator Dennis Genereau.

Minnesota’s budget agency will come out with an updated budget forecast on March 6. Lawmakers will then work in earnest to draft a two-year budget and adopt or reject parts of Walz’s budget proposal.

Of particular concern for counties is Walz’s proposal to establish a 5% county share for residential services paid through a state program known as disability waivers. Walz’s budget estimates this will save the state about $400 million over the next four years.

To cover the increased costs on the counties, they would need to raise property taxes, as many of the services are mandated by federal or state law and thus can’t be cut.

“We really only have the one lever as the county to raise revenue, and that’s the property tax levy. If anyone knows me, that’s not my favorite thing to do,” said Dave Beer, chair of the Scott County Board of Commissioners.

Walz’s office didn’t immediately respond to the Reformer’s request for comment about the county officials’ concerns.

Sen. Jordan Rasmusson, R-Fergus Falls, said during the press conference that Walz’s budget doesn’t actually cut spending but merely shifts it away from the state. Rasmusson said the state should focus on other areas to save Minnesota money, like cutting MinnesotaCare and free college for noncitizens, though neither would produce anywhere near the $400 million Walz is looking to cut in this area.

The total cost of the North Star Promise program, which provides free college to Minnesota residents from households with less than $80,000 in income, was estimated to be $50 million per year when it passed in 2023, according to nonpartisan House research staff.

In fiscal year 2023, the MinnesotaCare program paid $676.5 million for medical services, but 91% was paid for by the federal government, according to House research.

“Those are the places that we need to look at prioritizing instead of just putting more and more of the burden on property taxpayers,” Rasmusson said.

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