The Minnesota Legislature met for a special session Monday to finish the final pieces of a $66 billion two-year budget.

Lawmakers reduced spending by $5 billion to prepare the state for shortfalls expected later in the decade, but they also made a few tweaks to state policy.

While many of the changes got hearings over the past few months, the budget largely came together in private meetings ahead of the special session and passed in just one day after a handful of public hearings.

Here’s a look at some of the bigger changes they approved, along with what failed.

Cannabis tax

This year’s tax bill didn’t change much, but there are a few additions.

The current state sales tax on legal cannabis sales will increase to 15% from 10%. That’s on top of the regular sales tax rate of 6.875%, bringing the total tax on products like beverages and edibles containing THC, the psychoactive part of cannabis, to just under 22%.

It will be higher still in cities and counties with their own sales taxes. St. Paul, for instance, has a total sales tax rate of 9.875%, making the tax on local cannabis sales almost 25%.

Industry critics say higher taxes could hurt the state’s nascent legal cannabis marketplace — which still hasn’t fully launched — by making black market alternatives more appealing to customers.

Higher electric vehicle fees

Legal cannabis sales aren’t the only area where Minnesotans will be giving the state more money. As part of this year’s transportation bill, owners of electric vehicles soon will start paying taxes on public charging and higher surcharges on vehicle registration.

Supporters of the new taxes say EV drivers don’t pay taxes on gasoline and ought to do more to cover road-maintenance costs.

The current base EV registration fee of $75 will double to $150 starting in January, with owners paying more based on their vehicle’s age and value. In 2027, the base tax drops to $100.

Plug-in hybrid vehicles also will come with higher registration charges: $75 next year and $50 starting in 2027.

The increased vehicle charges should generate more than $23 million in 2026-2027 and $53 million in 2028-2029, according to a fiscal analysis from House and Senate nonpartisan research.

Starting in 2027, Minnesota will have a new 5-cent-per-kilowatt-hour tax on electricity sold through public EV charging, which is expected to raise $4 million in 2028-2029.

Transportation spending

The roughly $9 billion transportation spending package that carried the EV tax changes also includes spending on major projects across the state.

A new central headquarters for the Minnesota State Patrol in the Twin Cities metro gets $97 million. And $8 million will help pay for new suicide-deterrent barriers along the Washington Avenue Bridge connecting the east and west banks of the University of Minnesota’s Minneapolis campus.

A replacement for the Blatnik Bridge connecting Duluth and Superior, Wis., gets $650 million next year. The estimated price tag in 2024 was $1.8 billion with Minnesota, Wisconsin and the federal government expected to split the cost.

Data center exemptions

A major area of debate that emerged as lawmakers prepared for a special session was the tax status of data centers — facilities that house large numbers of computer servers that store online data and handle computations for artificial intelligence.

Under current law, data centers are exempt from state taxes on the vast amounts of electricity they consume. This year, the Legislature eliminated that exemption, which had been set to expire in 2042 or within 20 years of a data center’s construction, whichever comes sooner. That should generate around $83 million in revenue in the next two years.

However, while the state is ending the electricity tax exemption, it’s extending other tax exemptions for data centers for software and equipment purchases; they’ll have an exemption for 35 years instead of 20, and the benefit will expire on whichever date comes later.

The legislation also sets up a Department of Natural Resources permitting process for centers that use more than 100 million gallons of water per year for cooling.

MinnesotaCare for immigrants

As part of a budget deal state leaders reached last month, DFL leadership agreed to Republican demands to end MinnesotaCare coverage for adult immigrants without legal status.

Coverage will end after 2025, though children will still be eligible. The benefit just kicked in this year, and more than 20,000 have enrolled.

The bill ends MinnesotaCare coverage for around 17,000 people. Republican supporters say ending coverage will save the state money, as enrollment in the program is three times higher than originally expected, but DFL opponents decried the bill as cruel as it will end coverage for cancer treatments and dialysis.

Special-ed cuts

Special-education aid is one of the biggest areas for cuts. State leaders said they’d have to curb spending this year to address shortfalls looming later this decade.

Rather than make the reductions directly, lawmakers created a special “Blue Ribbon Commission” to explore around $250 million in cuts. If the commission doesn’t find areas for cuts, they’ll happen automatically.

The budget also seeks to control growth in spending on nursing homes and disability services.

Bonding

A new bonding bill will provide money for a range of public works projects across Minnesota. It’s been two years since the state last passed an infrastructure borrowing bill.

This year’s bill borrows $700 million, down from $2.6 billion in 2023. Of that amount, $290 million will be dedicated to projects like roads, bridges and wastewater-treatment plants.

Other projects include $55 million for a new 50-bed psychiatric facility at Anoka Metro Regional Treatment Center and $13.7 million to rebuild the Minnesota Zoo’s 47-year-old animal hospital.

A $395 million bonding request to renovate downtown St. Paul’s Xcel Energy Center didn’t make the cut, even after owners dropped the request to $50 million.

DFL gains preserved

Besides cuts to state-funded health insurance for undocumented adults and a few small Republican-backed tweaks to paid family and medical leave and sick time requirements, Democratic-Farmer-Labor lawmakers managed to protect most of their gains from when they controlled state government in 2023.

Republicans, who hold half the seats in the House, got a modest cut to the maximum payroll tax rate for the paid family and medical leave program set to go into effect in 2026.

But other signature pieces of the 2023 DFL agenda remain intact, including free school meals for all students, free college tuition for low-to-moderate-income families and a mandate for 100% carbon-free energy by 2040.

Private school aid

Cuts to state aid for private schools proposed by Gov. Tim Walz didn’t make the state budget. Minnesota provides about $55 million a year to private schools for services like transportation and counseling. Those cuts were off the table as part of a May budget deal between the governor and legislative leaders.

Social media tax

DFL lawmakers earlier this year proposed a new tax on social media platforms that collect data from users as a way to create new revenue for the state. It didn’t make the final tax bill.

The new tax could have generated $334 million in revenue over the next four years. It would have been the first of its kind in the country, backers said.

Metro sales tax

A proposal to shift $93 million in Twin Cities metro area sales tax revenue to the Metropolitan Council didn’t make the final version of the transportation package after protests from counties and warnings from Republican legislators that it could tank the overall bill.

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