Did government deliver on jobs?by Tom Scheck, Minnesota Public Radio,
Martin Moylan, Minnesota Public Radio
St. Paul, Minn. — For the past seven months, jobs and the state budget were atop of the discussion for Gov. Mark Dayton and GOP legislative leaders.
But did they deliver on the jobs agenda?
From the moment the legislative session began in January, Gov. Dayton and GOP legislative leaders said creating jobs and fixing the economy were their top priorities.
The shutdown put 22,000 state workers and thousands more private sector employees out of work for nearly three weeks. With the session and shutdown now over, both sides said they made progress.
"I wish there were more in there for jobs," Dayton said. "It lost its focus there for a while, but it turns out there are some very good measures in there for job creation."
Dayton told MPR News the new budget includes key initiatives that could help Minnesota attract business and put people to work. Up to 14,000 people will be employed by a $500 million public works bill Dayton pushed for, he said. Dayton also said he secured $10 million for investment funds that help the state attract and retain businesses.
The governor also discussed jobs he protected when he insisted Republicans drop their push to cut the state's workforce.
"What's not in the budget is the proposal to cut state employees by an arbitrary 15 percent over the next four years," Dayton said. "Removing that protects about 5,000 jobs that would have otherwise been eliminated."
The budget will mean some state worker lay-offs, Dayton said, but he indicated that agency heads will work to protect workers by relying on retirements and cutting costs elsewhere.
The governor is disappointed the budget did not include greater investment in higher education and K-12 schools, areas that he said make the state's workforce attractive to businesses.
A portion of the budget specifically for business attraction is a tax break aimed at companies seeking to build large data centers. The tax bill allows companies that build data centers in Minnesota to exempt sales taxes for energy use, software and computer equipment.
The tax credit will encourage those companies to build in the state, said Minnesota High Tech Association President Margaret Anderson Kelliher, who used to be Speaker of the Minnesota House.
Each data center employs about 200 people and more centers will be needed as consumers rely more on mobile devices and computers, Kelliher said.
"There's more transfer happening to the cloud. People hear about the cloud a lot," Kelliher said. "Well, one of the ways the cloud works and the important part of the cloud working is having these data centers where the data is stored and protected and kept."
Republicans are focusing on other tax policy — the taxes they kept from being raised. Senate Majority Leader Amy Koch and House Speaker Kurt Zellers both said the governor's push to raise income taxes on Minnesota's top earners would have hurt job growth.
Also, eliminating a tax on health care providers will help employers, Koch said. The tax is scheduled to expire in 2019 but could terminate earlier when the federal health care law kicks in. Koch said the tax cut could help spur job growth in the state's health care sector.
"Taxes overall, in the state of Minnesota, are incredibly high so anytime we can get rid of one is key. And this one has been particularly problematic for many small businesses and large providers like Mayo Clinic. "
But Republicans lost their push for other business tax cuts. At the start of the session, GOP legislative leaders said business tax cuts would help create jobs even in the face of a state budget deficit of $5 billion. They eventually dropped the plan.
A big achievement of the session is the law that will speed up environmental reviews, said the state's top business group, the Minnesota Chamber of Commerce. The law will help Minnesota compete for existing or new business development, Tom Hesse, vice president of government affairs for the chamber.
"What we always heard from members when we talked about permits around the state, is that what takes years in Minnesota takes months in other states," Hesse said. "The reforms that were passed early on in the legislative session should help address that."
Both Dayton and GOP legislative leaders said they're already focusing on the future. Dayton intends in the next few months to talk with business leaders about bringing more companies to Minnesota. Koch expects lawmakers to focus on another round of business tax cuts when they return for the 2012 legislative session.
Tom Scheck covers politics and government for MPR News.