House gives OK to energy, agriculture and commerce package

Geothermal energy, anaerobic digesters and permitting reform for electricity transmission projects. Substance abuse treatment, recovery and prevention grants. Treatment of nitrate contamination in southeastern Minnesota’s drinking water.

And then there’s submitting a federal waiver seeking to implement a public option health care program.

You might not expect such subjects to all be addressed in the same bill, but such is the case with HF4975/SF4942*, a bill sponsored by Rep. Patty Acomb (DFL-Minnetonka) and Sen. Nick Frentz (DFL-North Mankato) that combines the work of the House committees overseeing climate and energy, commerce and agriculture.

The House voted to replace the language from the Senate bill with that of the House bill, then launched into an evening of debate Thursday that included the consideration of 44 amendments and adoption of 21 of them before passing the bill 68-59 and sending it back to the Senate for concurrence. A conference committee is expected to be charged with working out the differences.

Climate and energy

Geothermal and anaerobic digester projects are the two biggest-ticket items in this area.

The largest outlay in the bill is the $14.2 million from the Renewable Development Account. That state-administered account is designed to support renewable energy projects and is made up of money that Xcel Energy pays to the state for being able to store nuclear waste at its Prairie Island and Monticello nuclear power plants.

For fiscal year 2025, allocations from that account would include:

• $5 million for a geothermal energy system at Minneapolis’ Sabathani Community Center;
• $5 million for an anaerobic digester energy system for Ramsey and Washington counties;
• $2.5 million for a geothermal energy system grant program; and
• $1.7 million for implementation of the U.S. Department of Energy’s SolarAPP+ software program by local permitting authorities.

“It builds on and helps implement the fantastic work of last year’s bill that put us on the path to 100% carbon-free electricity by 2040 and net-zero greenhouse gas emissions statewide by 2050,” said Rep. Larry Kraft (DFL-St. Louis Park). “To hit our goals, we need more transmission capacity and to take better advantage of our current capacity. One of the biggest provisions in this year’s climate and energy bill is the Minnesota Permitting Infrastructure Act, which makes smart, targeted reforms in our permitting process to speed up our transition to clean energy sources.”

The permitting reform in the bill includes grid-enhancing technologies that could alleviate congestion in transmission systems. There are also several items in the bill related to fuel switching, the process of replacing one form of technology with another for such things as home heating, cooling, water heaters and electricity sources.

Four energy-related amendments won approval. They would extend geothermal planning grants through 2029; require utilities to set a schedule for the retirement and a plan for the repurposing of each coal-powered facility; set up rules for aggregated pumping stations; and add environmental review requirements to procedures for property assessed clean energy loans.

Among the amendments voted down that spurred the liveliest debate were proposals to:

• delete Renewable Development Account appropriations and refund the money to ratepayers;
• place a limit on Renewable Development Account appropriations;
• remove $300,000 in funding from the SolarAPPP+ account and fund an advanced nuclear technologies study; and
• require 50% of components in a state-subsidized wind energy project to be manufactured in the U.S.

“The Renewable Development Account has become kind of a legislative slush fund,” said Rep. Marion Rarick (R-Maple Lake). “We’re not really developing renewable energy. We’re doing pet projects.”

Commerce

Rep. Zack Stephenson (DFL-Coon Rapids) sponsors the commerce provisions.

“We have some really phenomenal work that Rep. [Steve] Elkins [DFL-Bloomington] has done on data privacy and security,” Stephenson said. “And the provision seeking a federal waiver to pursue a public option is a critical step in the process to make sure that all Minnesotans have access to quality health care.”

The bill would provide in fiscal year 2025:

• $5.5 million to the Department of Health for substance use treatment, prevention and recovery grants;
• $2.73 million to the Office of Cannabis Management for enforcement purposes and a product testing and reference lab; and
• $1.85 million from a special revenue fund to beef up the Commerce Department’s insurance fraud efforts.

An additional $1.74 million would go to the attorney general’s office in the 2026-27 biennium to enforce the Minnesota Consumer Data Privacy Act.

About half of the $2.73 million proposed for the Office of Cannabis Management would go toward the enforcement of temporary regulations established by last session’s legislation legalizing adult use recreational cannabis.

The most controversial provision proved to be one added in the House Ways and Means Committee on May 3 that would request a federal waiver to start the process of implementing a public option health care plan.

Rep. Anne Neu Brindley (R-North Branch) unsuccessfully proposed an amendment to remove the language after she and her Republican colleagues proposed 26 amendments that would place multiple contingencies upon implementation of a public option, with 15 of them adopted.

The changes to the request for a waiver that were successfully amended to the bill were proposals that would call for certification that the waiver request would:

• have actuarial and economic analyses that examine the uninsurance rates for 2026-27;
• require coverage under the public option meet the requirements that apply to state-regulated markets;
• not negatively impact access to health care services;
• not increase the premium rates for non-public option enrollees;
• not rely on any new or increased taxes, fees or assessments;
• not add to or result in a state budget deficit;
• reduce premiums and increase access for public option enrollees and those not enrolled in a public option;
• estimate the difference between expected payments to providers under the public option compared to commercial contracts;
• improve market stability for public option enrollees and those not enrolled;
• clarify the waiver’s intent;
• include an analysis of the impact the continuation or expiration of reinsurance would have on the public option;
• not be implemented without explicit legislative authority;
• require written notice to the Legislature after the request is submitted; and
• require the public option to meet the same requirements regarding geographic accessibility and provider network adequacy as other health carriers.

“These were poorly drafted,” Neu Brindley said of several amendments. “These were specifically drafted to developing the waiver request, and it’s already paid for. We don’t have to raise taxes to develop the waiver request.”

Agriculture

In this subject area, the bill calls for almost $4.5 million in General Fund appropriations, with $3.1 million to treat nitrate contamination of drinking water in southeast Minnesota. The money would be used for home water treatment, including reverse osmosis, for private drinking-water wells with nitrate more than the maximum contaminant level.

Other money would help maintain funding for the state’s Agricultural, Growth, Research and Innovation program and increase funding for soil health equipment grants, biofuel equipment grants, a pollinator research account and farm-to-school nutrition programs.

Provisions in the bill would create a clean water carbon credit working group; expand a farm-to-school nutrition program; protect local honey production with labeling requirements; and offer pesticide application training programs in Spanish.

“We continue the work of last year to clarify intent for the farmland assistance program, a successful program supporting the next generation of farmers,” said Rep. Samantha Vang (DFL-Brooklyn Center).

Among unsuccessful amendments were proposals to limit to three years the prohibition on profiting from the resale of equipment purchased with a soil health equipment grant; increase funding for the elk deprivation account; and make more funds available for down payment assistance.

Republicans took issue with the sunset of the Agricultural Fertilizer Research and Education Council, whose $1.3 million budget comes from a 40-cent per ton fee on fertilizer purchases.

“Last year, we had a surplus of $17.5 billion,” said Rep. Paul Anderson (R-Starbuck). “And yet we are taking money away from a farmer-funded program to go to another program directed by the Department of Ag. I think this is just plain wrong.”

— Session Daily writers Margaret Stevens and Tim Walker contributed to this story.