Walz administration proposes $907 million 2026 infrastructure package, prioritizes asset preservation
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Summary
The Walz administration recommended a $907 million 2026 infrastructure plan, with $750 million in general obligation bonds and $316 million targeted to asset preservation; the proposal emphasizes deferred maintenance, water projects and targeted local grant programs.
Erin Campbell, commissioner of Minnesota Management and Budget, told the Senate Capital Investment Committee on Feb. 19 that Governor Walz's 2026 infrastructure proposal totals $907 million from all sources, including $750 million in general obligation bonds and $50 million in appropriation bonds.
Campbell said the administration prioritized $316 million for asset preservation — roughly 45% of the general obligation bond request — to address a growing backlog of deferred maintenance across state agencies. "Asset preservation projects are improvements to existing state assets to address life and safety hazards, accessibility, security and building code violations," she said.
The governor's plan allocates funds across several categories. Campbell highlighted water infrastructure ($113 million), including wastewater, lead service-line replacement and emerging contaminants; $50 million for high-priority pavement projects on trunk highways; $61 million for Department of Corrections expansion and programming at Rush City; and investments in housing infrastructure bonds intended to preserve or create 450 to 550 homes.
Campbell also described the package's funding mix: $750 million in GO bonds, $50 million user-financed and $157 million in other funds such as appropriation and trunk-highway bonds, trunk highway cash and general-fund cash. She warned that a provision in 2025 law removed assumed future bonding from the state's budget forecast, meaning future bond debt service will compete directly with other general-fund priorities.
Committee members pressed MMB on the modest transportation allocation in the governor's plan. Senator Jasinski noted widespread transportation needs and called the administration's $50 million figure "frustrating." Campbell said transportation details are being developed with the Department of Transportation and that members would hear more in the Transportation Committee.
The administration posted materials and the full list of agency and local requests on MMB's website, Campbell said, and agency presentations will follow in additional committee hearings.
The committee will continue reviewing agency requests in upcoming sessions and tours scheduled by the committee.