Minnesota House ties on constitutional amendment to return future surpluses to taxpayers

The Minnesota House on March 13, 2025, failed to pass House File 4, a proposed amendment to the Minnesota Constitution that would direct excess general fund surpluses into a newly created Minnesota Tax Relief Account and authorize one-time refunds or tax reductions. The final vote was 67 ayes and 67 nays, and the bill did not pass.

Representative W. Johnson, the bill's author, framed the proposal as a check on state spending and a way to return money to residents. "These surpluses don't belong to the government. They belong to the people of Minnesota," Johnson said during his opening remarks. He urged colleagues to place the question before voters in 2026: "Let's pass House File 4 and let the people decide."

Why it mattered

Supporters said the amendment would give voters a direct choice about returning large surpluses, limit the growth of permanent spending driven by one-time windfalls and provide targeted, one-time relief to taxpayers. Opponents said the measure would handcuff future legislatures, complicate responses to economic downturns, constrain funding for schools, health care and emergency reserves, and risk directing money to wealthy property owners and corporations while excluding many renters and low-income residents who pay sales or embedded property taxes but have no state income tax liability.

Key floor actions and votes

- Amendment A3 (technical clarification on which biennium is used) was adopted by roll call, 101 ayes, 33 nays. Representative Johnson explained the change: it clarifies which biennium's forecast is used to determine surplus calculations.

- Amendment A5 (limiting refunds to taxpayers with reported income under $1 million) was adopted by roll call, 101 ayes, 33 nays. Representative Gomez described A5 as targeting refunds to households most affected by cost-of-living pressures.

- Amendment A4 (would have devoted tax relief account dollars to expanding state child tax-credit efforts) failed on a tie vote, 67 ayes, 67 nays.

- Amendment A6 (proposal to direct funds to renters/tax credits for renters) failed, 66 ayes, 67 nays.

- Amendment A8 (proposal to backfill the Health Care Access Fund in the event of large federal Medicaid cuts) failed on a tie, 67 ayes, 67 nays.

- Amendment A9 (an amendment to direct a surplus to education aid) was ruled out of order by the speaker under House rules; Representative Long appealed the ruling and the House sustained the speaker's ruling, 67 ayes to 66 nays, leaving A9 out of order.

- Final passage: After floor debate and amendment votes, the House recorded a final vote of 67 ayes and 67 nays; House File 4 did not pass.

Discussion highlights

Representative Stevenson questioned the timing and fiscal prudence of locking a constitutional rule tied to forecasts that can vary across biennia, asking whether applying one-time refunds in a period with a near-term surplus could worsen projected deficits in subsequent biennia. "Why would we choose to force ourselves to do that in a situation where there is a surplus in the first biennium and a significant deficit in the tails?" Stevenson asked.

Representative Gomez, chair of the tax committee, noted the permanent tax changes enacted in 2023 (including a large child tax credit and other changes) and said the proposed amendment would limit use of future surplus funds to one-time refunds rather than ongoing policy changes. Gomez and other Democrats pushed amendments to target refunds to lower- and middle-income households and to direct funds to anti-poverty tax credits; some of those amendments were rejected on party-line or tie votes.

Representative Noor and other Democrats raised the risk that automatic routing of surplus dollars to refunds would leave the state less able to backfill potential federal Medicaid cuts, finance schools, maintain reserves or respond to disasters.

Representative Weiner and other Republican backers argued the measure returns decisions to voters and prevents recurring spending increases financed by temporary surpluses. "This is the people's money," Weiner said in floor remarks supporting the bill.

What the bill would have done (as amended and debated)

- Created a Minnesota Tax Relief Account into which revenues in excess of 105% of projected expenditures would be deposited. - Required any funds in the account to be used only for one-time refunds, one-time tax reductions, or other narrowly defined tax-relief measures, subject to future legislative action and voter approval of the constitutional change. - Left design and distribution mechanics to future legislatures should voters approve the amendment.

Clarifying details from the floor

- The bill author and supporters emphasized it would trigger only when a forecasted surplus exceeded a threshold (described on the floor as revenues above 105% of projected expenditures). - Representative Gomez's A5 amendment narrowed eligibility to taxpayers reporting income under $1 million. - Multiple floor speakers warned that forecasts used in the constitutional text could reference different biennia depending on timing; A3 sought to clarify which biennium would be used.

Outlook

Because House File 4 failed on the final floor vote, the constitutional amendment will not appear on the 2026 ballot from this action. Proponents may refile the measure or seek alternative statutory approaches, while opponents signaled they will continue pressing amendments to prioritize schools, health care and targeted tax relief.

Votes at a glance (selected floor outcomes during the March 13 session)

- A3 amendment to HF4: adopted, 101-33. - A5 amendment to HF4: adopted, 101-33. - A4 amendment to HF4: not adopted, 67-67. - Final HF4: not passed, 67-67.

Ending

The debate on House File 4 consumed much of the House's floor time and reflected broader partisan disagreement about budget priorities, the role of constitutional protections for fiscal rules, and how to target tax relief. With HF4 defeated, lawmakers left the question of surplus distribution for future legislative sessions or ballot measures.