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Over the weekend, Republican House Speaker Lisa Demuth officially announced her candidacy for governor. Demuth is the most senior Republican to enter the race so far, joining a crowded field that already includes Rep. Kristin Robbins, former GOP nominee Scott Jensen, and businessman Kendall Qualls. Several candidates have indicated they will run in a primary if they do not win the endorsement.
If she secures the Republican nomination and wins a potential primary, Demuth will face Gov. Tim Walz, who is seeking a third term. Her entry adds a new dynamic to the race, not only because of her position as Speaker, but also because she leads a closely divided House, where both parties currently hold an equal number of seats. How she balances the demands of governing while running a statewide campaign will be closely watched in the months ahead.
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BUDGET UPDATE
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Minnesota wrapped up its 2024–25 budget year with a stronger financial position than expected, posting a $941 million surplus. The state’s financial report from the Department of Minnesota Management and Budget shows revenues $1.3 billion higher than projected, while expenses were about $364 million above estimates.
The unexpected boost came mainly from higher tax receipts, and funds returned from projects or programs that didn’t use their full budgets. On the spending side, most of the increase was tied to education, as public schools enrolled about 1,800 more students than forecast and faced slightly higher special education costs.
This surplus gives lawmakers more flexibility going into an election year, possibly funding construction projects with cash or reducing debt, while also providing a buffer against potential future deficits. Two years ago, the state also finished ahead of projections by roughly $820 million.
Lawmakers will get a more refined understanding of the state’s economic situation in early December when the November forecast is released.
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SPECIAL SESSION UNLIKELY
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Last month, Gov. Walz walked back his commitment to call a special legislative session on gun restrictions, saying he would only do so if there’s an agreement among legislative leaders. The DFL governor, who previously vowed to reconvene lawmakers regardless of a deal, now says a session without bipartisan cooperation would be “a waste of money and time.”
Calls for a special session on gun violence came after the horrific shooting at Annunciation Catholic School in Minneapolis this summer. The divided legislature leaves neither party with enough votes to pass legislation without bipartisan support, which has proven difficult due to a significant difference in philosophies between Democrats and Republicans at the Capitol. It can be expected that these issues will surface during the 2026 Legislative Session, which convenes on Feb. 17, 2026.
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LEGISLATIVE RETIREMENTS
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The list of legislative retirements continues to grow, as Rep. Ron Kresha (R, Little Falls) announced last week that he will not seek reelection. His announcement comes in the wake of a lawsuit filed by conservative activists over claims that he committed fraud on applications for Paycheck Protection Program loans during the COVID-19 pandemic. This week, Sen. Sandy Pappas (DFL, St. Paul) also announced she will not be seeking reelection after more than four decades in state government.
Rep. Kresha and Sen. Pappas join a list of retirements this year that includes Sen. Jim Carlson (DFL, Eagan), Jeremy Miller (R, Winona), Rep. Kelly Moller (DFL, Shoreview), and Sen. Ann Rest (DFL, New Hope).
Legislative retirements and changes can be found here.
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EWALD GOVERNMENT RELATIONS TOOLKIT
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We are sharing content along with our updates to help you better understand the legislative process and how to engage effectively. From decoding how the Legislature works to learning how to advocate for your priorities, these resources are designed to support your advocacy every step of the way.
This week’s articles outline how to find information at the Capitol and how the bonding process works.
Article Links:
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HELPFUL LINKS TO FOLLOW ACTION AT THE STATE CAPITOL
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