State Sen. Gary Dahms (left) and State Rep. Paul Torkelson participated in a town hall ahead of the 2025 legislative session. A top issue during the town hall was rural nursing home reimbursement delays and whether the session would start on time.

NEW ULM — State Sen. Gary Dahms, R-Redwood Falls, and State Rep. Paul Torkelson, R-Hanska, participated in a series of town hall meetings on Tuesdays ahead of Minnesota’s 2025 legislative session.

The session is scheduled to begin Tuesday, but at the top of New Ulm’s town hall meeting, Dahms and Torkelson said it could be delayed. Both Senate and House DFL legislators are considering not attending until special elections have been decided.

On the Senate side, Dahms explained that the DFL had a majority, but the death of Minnesota DFL Senator Kari Dzidezic on Dec. 26 forced a special election scheduled for Jan. 28. At the same time, DFL Sen. Nicole Mitchel is expected to be absent Tuesday due to pending court date for allegedly breaking into her stepmother’s house in Detroit Lakes to take back items belonging to her late father.

Dahms said it is possible that on the first day of session, the Republicans — though in the minority — could have a temporary majority. The Republicans could use this temporary majority to set the leadership and organization of the session. To prevent this, many DFL Senators are considering not attending the first day of the session to prevent any votes from being taken until the DFL has a majority present.

Torkelson said there was a similar situation in the Minnesota House. Following the November election, the Minnesota House was split even with 67 Republicans and 67 Democrats. However, like the Senate side, a DFL member of the House will be absent on the first day of the session due to a special election, giving Republicans a temporary 67-66 majority.

Torkelson said with this advantage the Republicans could elect a House Speaker with only 67 votes, which he confirmed his party intends to do. The House DFL is also considering going on strike to prevent Republicans from taking a vote.

Dahms and Torkelson said until these issues are resolved the session might not start. Their concerns were that this could delay the session start until February and prevent work on balancing the budget.

Dahms said in November there was a $661 million surplus forecast, but going into February it is expected to be less. Dahms suspects the Senate will need to look at making cuts to the budget because there will not be enough money to keep the current budget in place.

“I think it is going to take a lot of cooperation to keep things moving,” he said.

“We need to tighten our belts, we have to figure out what our priorities are,” Torkelson said.

He believes some programs would need to be eliminated. Some of last year’s budget items will need to be limited to one-time spending and will be among the first cuts.

Torkelson said he wanted to avoid a state shutdown at all costs. He said the last shutdown happened under Gov. Mark Dayton. At that time, the governor could determine what were essential services. Since then, the court decided that is no longer an option. A shutdown will end all state-funded endeavors immediately.

“A shutdown is not an option in my book,” Torkelson said.

Another goal for the session was to make sure Greater Minnesota received its fair treatment. During the question and answer part of the town hall several individuals asked about helping rural nursing homes.

Minnesota’s rural nursing homes are facing funding shortfalls due to the state’s method of reimbursing Medicaid expenses. Nursing homes in the Metro area are receiving timely reimbursements, but the rural nursing homes are seeing delays of 21 to 24 months.

This means rural nursing homes are forced to cover new expenses out of pocket and not see any compensation for up to two years.

“It’s a complicated situation, but the impact is very real,” Torkelson said. He said as many as 30 rural nursing homes have closed in recent years and he was concerned the DFL legislators were not taking this threat seriously. However, with the DFL trifecta broken this session he believed nursing home reimbursement could be a top priority.

Dahms said part of the problem with nursing home reimbursement is legislators in the metro area are not seeing reimbursement delays and do not understand the problems faced by Greater Minnesota nursing homes.

He said at the end of the 2023 session a $332 million block of funding went to nursing homes rural nursing homes did receive much of this funding, but it did not solve the problem. He worried many metro legislators thought the block of money fix the problem. Dahms said this money was only a band-aid on a wound that was still growing.

Andy Biebl a former Certified Public Accountant who was volunteering his time at Oak Hills Living Center in New Ulm provided the legislators with local numbers. He confirmed the reimbursement lags for Oak Hills were 21 to 24 months.

“All the inflationary costs Oak Hills had to cover in 2022 and 2023, are only now being reimbursed by the state,” he said. “In 2023, there was a mandate raising the minimum rates for all types of Oak Hills employees. This will cost Oak Hills $600,000 to $700,000 a year in 2026 and $750,000 in 2027 with no reimbursements.”

This means Oak Hills is looking at $1.5 million in out-of-pocket expenses over two years.

Biebl said the mandate to increase wages for nursing home employees is not a bad idea, because it could help with recruitment, but if the nursing homes do not have the funds to pay for it, it will hurt the care facilities.

Biebl also calculated the interest on the $1.5 million Oak Hills would need to pay. He estimated the interest was $80,000 each year with another $20,000 at the start. This was a grand total of nearly $200,000 in interest.

“The problem is not the interest itself,” Biebl said “but given our position can we even borrow the money? Can our reserves handle a $1.5 million hit for two years until we see a recovery?”

Biebl believed Oak Hills could cover the expenses through the aid of volunteers and donors, but he was not sure about other rural nursing homes.

“A two-year delay is a big deal and seems unreasonable,” Torkelson said. “We know we owe the nursing homes that money, why don’t we get it to them soon.