ST. PAUL, Minn. (WCCO) — The legislative session is slated to end on Monday, but top Democrats and Republicans at the state capitol said it’s becoming increasingly unlikely that lawmakers will wrap everything up before then and avert a special session.

With just five days left, the pile of unfinished business stands tall. The Republican-controlled Senate and DFL House haven’t reached a budget deal yet on how much to spend on government programs and services in the next two years and leaders have divergent policy priorities.

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Given the logistics of what’s involved to assemble bills that both chambers agree on, it will be “very difficult to finish on time,” House Speaker Melissa Hortman, DFL-Brooklyn Park, said Wednesday.

“There’s a lot of dramatics that are typical to end-of-session negotiations that haven’t happened yet, which probably indicates that the light at the end of the tunnel at this point is an oncoming train and not the end of the tunnel,” she said.

Hortman and her Republican counterpart Senate Majority Leader Paul Gazelka, R-Nisswa, both agreed that they are inching closer to an agreement, and said they had productive days of work together this week.

But for Democrats an agreement hinges on police accountability changes while Republicans say Democrats need to back away from any tax increases to close a deal, underscoring the work that awaits leaders in the coming days.

“We definitely don’t need a tax increase on anyone,” Gazelka told reporters. “That is a key number that must break for us to end on time.”

Republicans have condemned tax increases of any kind since the beginning of session, but they say the billions of dollars the state is set to receive from the latest federal COVID relief plan plus a state budget surplus further reinforces their position.

Meanwhile, Gov. Tim Walz joined faith leaders in a Wednesday news conference to continue to ramp up the pressure for more police accountability measures this year. They believe last year’s bipartisan actions to change some of the state’s laws governing law enforcement were just a first step and more changes are urgent.

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Hortman agrees and said those policy proposals are their key to advancing negotiations.

“The linchpin is police reform and accountability. Very similar to last summer, there’s quite a bit of work for us to do,” she said.

Earlier Wednesday, House Minority Leader Kurt Daudt, R-Crown, expressed no confidence about a timely end of session and urged DFLers to take quick action on a stand-alone bill so Minnesotans don’t pay taxes on Paycheck Protection Program loans for small businesses and extra federal unemployment benefits from the federal government ahead of Monday’s extended tax deadline.

“This is just the blow they do not need,” he said, saying businesses and 250,000 Minnesotans who got an extra $600 in unemployment benefits from the federal government last year will be in for a “rude awakening.”

The Senate passed a bill exempting all PPP loans from state taxes and part of extra unemployment insurance, while House Republicans want to conform fully with the federal government to exempt up to $10,200 in jobless benefits. The U.S. Treasury’s guidance released Monday said relief in the American Rescue Plan can be used for this purpose.

When asked if the House is willing to move on the proposal, Hortman and House Majority Leader Ryan Winkler, DFL-Golden Valley, said the issue is part of overall talks with the Senate.

“Without question, Minnesotans who have taxes due for unemployment insurance should expect that we would step up and address that issue,” Winkler said. “We have so many issues on the table and the tax issue isn’t the only important one.”

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If Walz seeks to extend his emergency powers, the legislature would need to come back June 14 for a special session, which might be the time lawmakers finally pass a budget and wrap up regular session business.

Caroline Cummings