The 2025 Minnesota Legislative Session commenced today. Lawmakers are tasked with passing a balanced budget before June 1. Lawmakers must adjourn on May 19. But the Governor can summon them back for a special session if they don’t finish their work by the May adjournment deadline. Legislators face escalating political tensions in the House of Representatives and a very different budget forecast than two years ago.

Things to watch:

• In December, Minnesota Department of Management and Budget released the November Forecast. The forecast predicts a $616 million surplus at the end of FY26-27 (7/1/2025-6/30/2027). This forecast is $1.1billion less than previous estimates. The reduced surplus prediction is largely due to higher actual spending in health and human services and education. The forecast also projects a $5.1 billion budget deficit by FY28.
• Going into session, the Senate is tied at 33-33.A special election in Minneapolis will break the tie later this month. Senate leaders reached a power sharing agreement over the weekend. Republican andDemocrats will share presiding officer posts and committee chair position. TheSenate named Senators Bobby Joe Champion (DFL) and Senator Jeremy Miller (R) as co-presidents of the Senate. Both parties will evenly split representation on committees. Lawmakers will likely undo the power sharing deal when one party holds a 34-seat majority.
• First, the House was set to convene with a 67-67ntie. Leaders negotiated a power sharing deal like the temporary deal in theSenate. When a district judge ruled that Curtis Johnson (DFL) did not live in the district he was elected to represent, Republicans announced Representative Demuth would be the Speaker of the House for the two-year biennium. Republicans also announced their intention to prevent Representative Brad Tabke (DFL) from taking his seat in the House. To prevent this, Democrats boycotted the first day of session to prevent the body from establishing a quorum, which is needed to elect a speaker.  All this has led to a constitutional crisis as Republicans and Democrats don’t agree on how a quorum is reached. Today, Secretary of State Steve Simon, who presides over the first day of session, declared that quorum was not reached and adjourned session. Republicans ruled that quorum was present and proceeded to elect Representative Lisa Demuth to be House speaker. Democrats will challenge theRepublicans actions in the Minnesota Supreme Court. You can read more about it with MPR News.

What this means for housing?

• Committee budget targets will be much smaller than they were in 2023.
• In the House, House Republicans will immediately get to work convening committee hearings and introducing bills. House Democrats will file a lawsuit and continue boycotting session until the courts rule on the matter.
• In the Senate, Senator Port (DFL) and SenatorLucero (R) will co-chair the Housing Committee until a member is elected in theMinneapolis special election.