Friends and neighbors,
I have been vocal against the Democrats’ tab fee increases of 2023. I support broad tax relief. Yet, I voted against an end of session budget agreement that included tab fee relief. Let me tell you why.
First, let's start at the beginning. In 2023, Democrats used their total control of government to raise tab fees, along with about $10 billion in other taxes and fees at the same time. I said raising taxes (with an $18 billion surplus!) was bad, I spoke against it, I voted against it, and I urged my colleagues not to do it. Democrats did it anyway.
Now there's been a large amount of public outcry. People are right to be angry, and so am I. I want those tab fee increases repealed, all of them, permanently.
Part of the end of session deal was a one-year, temporary reduction in tab fee rates. Not a repeal. A one-year pause. Which I guess would be better than nothing, except attached to it was $600 million in cuts to some of the most vulnerable people in Minnesota, which is a trade I could not make in good conscience.
I want to be clear about something, because people who know me already understand where I come from. I am a limited government, small business guy who believes government takes too much of your money and does too much with it, often foolishly. Keeping money in people's pockets is something I believe in deeply. Tab fees are too high, just as many taxes are in Minnesota. But I also know a bad deal when I see one, and this was a bad deal.
The human services budget cuts $300 million in state dollars over four years, and because almost all of these programs are matched by the federal government dollar for dollar, the real-world reduction in dollars flowing to patients and providers comes out to around $600 million total. The people on the receiving end of those cuts are people who cannot advocate for themselves: children with autism receiving therapy, disabled adults who need overnight supervision, people who cannot cook their own meals or get to their own appointments or safely shovel their own sidewalks, family caregivers who need a break, and kids in mental health treatment. Those are the people we cut funding for in exchange for a one-year tab fee reduction.
And then there is the Family Residential Services crisis. This is one piece that I have been working on for nearly a year, and it genuinely breaks my heart that it was removed from the final agreement at the 11th hour.
Most people have never heard of Family Residential Services, and I completely understand that. It sounds like government jargon. In simple terms, it is a type of home-based care. These are regular homes, with real families, where a person with a significant disability lives alongside the people caring for them. Homes where caregivers share meals with the people they serve, celebrate birthdays together, and provide around-the-clock support for people who often have no other family who can.
In 2023, when Democrats had total control of government, the legislature switched how these providers get paid. Instead of payments based on each person's actual level of need, they moved to a flat rate system that, for many of these homes, meant a pay cut of 50 percent or more.
The results have been devastating. Between last fall and April of this year, 65 of these homes have already closed, eliminating 161 beds, and up to 29 children have been displaced from the only homes they have ever known. Some ended up in crisis care and some ended up in hospitals, and one expert says we could lose 80 percent of these homes statewide, meaning roughly 3,300 vulnerable Minnesotans would lose their living situations and be pushed into institutional care that costs the state three to five times more than keeping them where they are.
I authored a fix, it passed the Senate with bipartisan support, and Governor Walz and House leaders refused to include it in the final agreement. It is an unconscionable travesty that will have terrible consequences.
I support cutting tab fees, just as I support tax relief more generally. I always have, and I always will. But I will not trade a temporary one-year pause for $600 million in permanent cuts to people who cannot come to the Capitol and fight for themselves. A man called my office the day we were debating this on the floor, and his caregiver told me there are days he does not remember his own name. He is the reason I cannot make that trade.
With as much waste and abuse and fraud as there is in our state government, there is no excuse for this bad deal to be on the table. We should be able to cut tab fees and help those who need it.
If you have any questions about the final deal or any of these issues, I’m happy to chat any time. It is a privilege to serve you.