If signed by Gov. Mark Dayton as expected, it will allow Minnesota to follow the other 49 US states in moving to upgrade their licensing systems.
The state can get an extension to continue using standard driver's licenses until October 2020.
Meanwhile, the Democratic governor and Republican legislative leaders are in a standoff over the budget.
It will take a bit of time for the state to produce the new licenses and the security system as required by the federal government. But Minnesota is likely to apply for a waiver to get more time to implement the law.
But even before the debate over immigrant identification, Minnesota lawmakers had a problem with the Real ID Act.
With it, Minnesotans will no longer have to worry about their driver's licenses not working for domestic flights.
If a license has not expired and a Minnesotan wants one of the new licenses, a new Real ID-compliant license may be obtained once they are available for a little extra money to have its expiration date extended. Dayton recently vetoed that bill, but it could come back up as legislators debate the final details of the budget by their May 22 deadline.
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This will also allow people with Real ID's to enter military bases.
The new Real ID licenses will have the same renewal fees as standard licenses, Smith said.
At stake is funding for almost all state government programs.
But most lawmakers were relieved to finally solve a problem that threatened to create major headaches for their constituents. The Legislature would have until June 30 to finish a budget in a special session.
Both sides can make a claim to public support.
Because bonding bills leverage state debt to pay for projects, they require a three-fifths "supermajority" to pass, and the bill offered up Tuesday fell a few votes short in the House.