Walz to announce infrastructure plan for 2024

[MUSIC PLAYING] CATHY WURZER: This afternoon, Governor Tim Walz will lay out his administration's plan to shore up public buildings, water treatment facilities, and other infrastructure projects around the state. Passage of a bonding bill will be the main order of business for the 2024 legislative session.

To get a jump start on that major piece of legislation, some lawmakers are out today taking a tour of various proposed projects. Members of the Capital Investment Committee are going to visit more than 40 communities over the next two days. Joining us on the line is the chair of that committee, DFL State Senator Sandy Pappas of Saint Paul. Senator, welcome.

SANDY PAPPAS: Thank you, Cathy.

CATHY WURZER: Last session was a budget session. Even numbered years such as this year, lawmakers usually pass a bonding bill. For folks not steeped in legislative protocol, what's the reason behind that timeline?

SANDY PAPPAS: Well, it's really to spread the work out. The governor has to prepare a budget, and so he likes to do that in the even year. And then the capital budget-- that's the operating budget. So the capital budget, which we'd like to call bonding, we do in the even year-- sorry, did I get my years mixed up? Does the budget in the odd year, we do the bonding in the even year to kind of spread out the staff work. And there's a lot of work that goes into preparing those budgets, and so it's spread out more evenly over two years.

CATHY WURZER: So you are going to tour various projects in the metro area today. What sites have you seen so far? What are you going to be seeing over the next couple of days and what have you seen so far yet?

SANDY PAPPAS: Right, so we're in the middle of our first day of a three day tour in what we call greater metro. And we do the four quadrants of the state and we do Minneapolis and Saint Paul. But sometimes, we stop at suburban districts on our way to rural Minnesota. But there have been a lot more requests this year, so we decided to dedicate three days to greater Minnesota.

So we started in Richfield, went to Edina, went to Chanhassen, went to Waconia, Prior Lake. And right now, we're in Burnsville.

CATHY WURZER: What's the ultimate-- what do you weigh? What are the factors that the committee weighs when you start talking about these various projects? Because there are so many of them.

SANDY PAPPAS: Right. They are required to submit their request to Minnesota Management and Budget. And last June, there were $7.2 billion in requests. So our purpose is really to get a sense of what the needs are throughout the whole state. It's a bipartisan bill. Our metro legislators get to see what the needs are in rural Minnesota. Our rural committee members get to see what the needs are in metro so that we can then craft a bill that's fair to the entire state.

CATHY WURZER: What do you think is a reasonable bonding bill in 2024? The price tag for a bonding bill.

SANDY PAPPAS: Well, I have my idea, but the rules say that-- because we have guidelines in order to keep our AAA bond rating. And the guidelines limit our bonding bill this year to $830 million.

CATHY WURZER: OK. So somewhere in that price tag, there are, of course, those who want to go a little bit lower than that, and there are others who would really like to go higher than that obviously. How does--

SANDY PAPPAS: Yeah, we're not able to go higher.

CATHY WURZER: Yes.

SANDY PAPPAS: 830 is our limit.

CATHY WURZER: And by the way, how does the cost of inflation affect all this?

SANDY PAPPAS: How inflation impacts our bonding bill is I originally had a much higher cash target. And about 650 million of that cash target was, theoretically, set aside to spend this year, because we're using bonds and we're using cash. However, because of inflation, that money was just at the bottom line and inflation really has taken up now all of that money. So the cash that any committee will have is really quite limited this year.

CATHY WURZER: Because there was talk of a cash only bill, actually, at some--

SANDY PAPPAS: Last year, we did do-- we did a bonding bill for 1.5 I believe and a cash bill for 1.1 billion.

CATHY WURZER: Mhm.

SANDY PAPPAS: Billion. But we had a huge cash surplus last year, so there is not going to be the ability to do a cash only bonding bill this year.

CATHY WURZER: This is an interesting bill, because, as you say, it needs bipartisan support. And it's interesting to watch as a reporter. Projects are usually held out for horse trading purposes, so a bonding bill is usually passed at the 11th hour of a session. Give us a sense of the back and forth that occurs to get folks on board.

SANDY PAPPAS: Well first of all, it's very important that I visit Republican projects throughout the state. So we are very evenhanded with that. Anytime a Republican legislator-- or a Democratic legislator-- requests us to visit their project, we certainly do that. If we're not able to visit the project for whatever reason, they'll have a time to present their project either on an evening hearing, or a lunch hearing, or during session. I work very closely with the lead, Senator Karin Housley from Stillwater, and the other members, the other Republican members of the committee.

We share a lot of similarities. We feel that asset preservation is very important. We feel that local communities need to pay their fair share, 50% if they're able, and have some skin in the game. We believe that infrastructure is really important and that the state has a role in assisting local projects, especially if they have a regional or statewide impact.

CATHY WURZER: So a supermajority is needed of, what, 60% to pass? If I--

SANDY PAPPAS: I need seven Republican votes minimum.

CATHY WURZER: Yes, OK.

SANDY PAPPAS: And all the Democrats.

CATHY WURZER: Right. [LAUGHS] And tell me a little bit about how you go about getting Republican votes. You mentioned that you visit--

SANDY PAPPAS: It's very similar to what I just said, Cathy, is that I just keep in touch with them. I have a lot of respect for them. I give them a lot of authority to choose their own projects. We just we go out to dinner, we just try to be friends, and try to share common goals that will help the entire state.

CATHY WURZER: And you've done this now for quite some time. What do you like about being on this committee?

SANDY PAPPAS: I think it is just fascinating to see the state. I never on vacation get to see the kind of communities and projects that we get to see on the bonding tour. We started in August with a trip to northwestern Minnesota. We went all the way up to Lake of the Woods. We also did northeastern Minnesota. We went all the way up to International Falls.

We were down in-- again, in the southwest where you find out that towns are so small and spread so far apart that there's no way they can share a wastewater system and-- to reduce their costs. And, of course, we were down in the southeast as well, and that's a lovely part of the state.

CATHY WURZER: Anything else you want to add about the work that's ahead of you on this committee?

SANDY PAPPAS: It's very difficult when-- I mentioned the amount of requests, $7.2 billion, and the size of the bonding bill, 830 million, to really take care of all the infrastructure needs. A lot of our water and our sewer systems are aging out. They were built 50 to 70 years ago, and they were financed by-- 95% by the federal government. These local, small towns are already paying $100 a month for their water and their sewer bills.

They just really, really need the state help, and it's-- we need the federal government. In spite of the all the bills that the federal government passed to help us with infrastructure, we just need so much more. And then in these growing suburbs, they have road issues where the roads just are not capacity-- they're dangerous. There are not enough pedestrian crossings. Their sewers are aging out as well if they're not in the metro council system.

And then we have our inner city communities where they're trying to do homeless youth shelters, and food shelves, and just kind of basic services that the local community is not able to keep up with.

CATHY WURZER: I wish you well here this coming session. Thank you so much.

SANDY PAPPAS: And thank you for having me on the show.

CATHY WURZER: We've been talking to DFL State Senator Sandy Pappas, who is the chair of the Capitol Investment Committee.