As the two-year legislative session heads into its final days and hours, a six-member, House-Senate conference committee is expected at any moment to release a compromise economic development bill that would make in the neighborhood of $4 billion in investments in a wide range of programs.

The House passed its $3.8 billion version of the bill on July 14, and the Senate passed a $4.3 billion package on July 21.

Both bills would use traditional bonding mechanisms as well as funding from both the fiscal 2022 state budget surplus and remaining state funding from the American Rescue Plan Act.

The Senate bill (S. 3018) includes tax relief measures and additional funding for affordable housing programs, early education provider grants, and the Clean Water Trust Fund.

The Senate included a number of outside sections aimed at giving municipalities tools to operate more efficiently, including technical corrections and language aimed to help modernize and streamline municipal services and support, such as updating the spending cap approval process for revolving accounts and establishing general fund revenue exceptions.

The Senate and House bills differ significantly on a number of provisions. These include an online state lottery provision in the House bill (H. 5034), which would not dedicate new proceeds directly to local aid, as is done with current lottery proceeds. The Senate bill would allow for discounted drinks during “happy hours,” as a local option.

On July 25, the MMA sent a letter to the conference committee members addressing a number of municipal concerns, including a request to codify local aid as the primary beneficiary of any online lottery, concerns about preemption of local decision making, and support for a number of outside sections aimed at municipal efficiency and modernization.

The MMA has been strongly urging passage of a final economic development bill before the formal legislative session ends on July 31. The allocation of the state’s ARPA funding is additionally critical, since federal ARPA rules require funds to be obligated by the end of 2024 and expended by the end of 2026. Both House and Senate bills would leave just over $1 billion in state ARPA funding.

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