Legislative leaders broker tentative deal on pandemic hazard pay, unemployment insurance fund

Legislative leaders on Thursday announced a deal on a long-stalled issue to award pandemic hazard pay to frontline workers and replenish the state’s unemployment insurance fund to avert steep tax increases on employers. 

House Speaker Melissa Hortman, DFL-Brooklyn Park, and Senate Majority Leader Jeremy Miller, R-Winona, said they brokered a tentative agreement late Wednesday night with the governor’s office. 

The deal, announced during a MinnPost Festival panel, will spend $500 million on pandemic hazard pay, twice the amount originally set aside last summer and half of what Democratic lawmakers were seeking. 

The state’s unemployment insurance fund would be replenished with $2.7 billion. It had been spent down because of the record number of unemployment claims filed during the brief pandemic-induced recession in 2020. 

Employers faced an April 30 deadline to submit taxes, giving lawmakers a firm deadline.

The agreement means that roughly 667,000 workers will be eligible for the pandemic bonus pay, which amounts to $750, Hortman said. Partisan differences over which workers should be eligible and how much they should get had kept the issue unresolved since last fall. 

As part of the agreement, Gov. Tim Walz will get to decide how to spend nearly $200 million in federal pandemic aid in ongoing COVID-19 response efforts. 

Miller and Hortman said the legislation would be ready for Walz to sign before Saturday. 

The current legislative session will adjourn in less than 30 days.