As the federal government shutdown continues into its second month, Minnesota Democrats have sharply criticized the U.S. Department of Agriculture (USDA) for failing to utilize a rainy-day fund to support the 440,000 Minnesotans enrolled in the Supplemental Nutrition Assistance Program (SNAP). Attorney General Keith Ellison has even joined a legal action against the Trump administration, contending that the USDA is disregarding a congressional mandate by not drawing from emergency funds. A recent ruling from a federal judge mandates the administration to access these emergency funds, alleviating immediate worries about benefit losses. However, the funds secured will not cover the entire cost of SNAP benefits for November, and the Trump administration has yet to respond to the ruling.
According to the governor’s office, Minnesota stands to lose $73 million in federal funding for SNAP in November, which translates to an average of $166 per recipient, funds that are crucial for purchasing food through state-issued debit cards. Minnesota possesses its own rainy-day fund and enjoys a budget surplus totaling approximately $5.1 billion, which could easily address the short-term needs for SNAP benefits and the Low-Income Heating and Energy Assistance Program (LIHEAP). Last winter, 125,000 Minnesotans received an average of $550 in federal assistance for heating bills through LIHEAP, and over 75,000 individuals have already applied for support this year.
However, utilizing state funds to mitigate the loss of federal assistance would necessitate action from the Minnesota Legislature, meaning Governor Tim Walz would need to convene a special session as the Legislature is not scheduled to reconvene until February. Senator John Marty, chair of the Senate Finance Committee, described the situation as a critical crisis, emphasizing the pressing need for action to prevent dire consequences for vulnerable residents.
Despite the federal judge’s temporary reprieve, Governor Walz stated that aiding these recipients largely falls under the federal government’s purview. His office highlighted that while $4 million in emergency food support has been announced, Walz continues to advocate for the release of previously allocated federal funds for these specific circumstances.
Senate Majority Leader Erin Murphy attributed the shutdown to the Trump administration but has expressed openness to considering the use of the state’s budget surplus for assistance. House Speaker Lisa Demuth and Senate Minority Leader Mark Johnson have not yet indicated their position on holding a special session to access the surplus.
Minnesota’s budget sustainability stems from a projected surplus of $1.9 billion, as outlined in the two-year budget signed into law earlier this year. This surplus is based on economic forecasts from Minnesota Management and Budget (MMB), which may be updated in November. Although the budget anticipates future deficits, the current projection allows some fiscal flexibility.
In addition to the surplus, Minnesota has approximately $3.2 billion in reserves, informally referred to as the rainy-day fund, and $350 million in a cash flow account to manage state obligations. State statutes typically restrict the use of these funds to situations where projected expenses exceed revenues. Historically, Minnesota has rarely tapped into its rainy-day fund for federal shortfalls, with only modest use in the past for LIHEAP funding.
As the government shutdown extends, Minnesota faces uncharted territory, with concerns mounting regarding its impact on essential programs like SNAP. Experts suggest that this situation is unprecedented, as previous shutdowns have not significantly disrupted safety net programs to this extent. The current political impasse raises questions about the fiscal health of states and the means needed to support vulnerable populations during prolonged federal inaction.