Bachmann Speaks at Monticello Chamber of CommerceLast week, I spoke at the Monticello Chamber of Commerce and discussed the issues of interest to the small businesses and community leaders in Minnesota’s Sixth District. Much like the other meetings and events I attended last week – including roundtable discussions with area healthcare providers and with local police and fire chiefs, visits to local businesses and organizations, such as the Minnesota Association of Farm Mutual Insurance Companies, and a tour of one of the most impressive new school facilities in the country located right in St. Joseph – everyone’s mind was on the so-called “stimulus” bill just signed into law by President Obama.I wanted to share that speech with you. Below are my prepared remarks:Thank, you, Susan, for that kind introduction, and for all your hard work on behalf of the Monticello Chamber and our community. You have truly done a great job at the helm of this organization. It is such a thrill to be speaking with you all here today at this Monticello Chamber luncheon - and to be joined by so many friends and familiar faces.I wish I had some happy news to bring you from Washington, D.C., but it seems like that is the only thing not included in the recently passed so-called “stimulus” bill. It will come as no surprise to any of you that our economy is struggling right now. One in ten mortgages is in arrears and credit’s tight. Businesses are closing their doors and Americans are losing their jobs. And the response of your government has been an ever-escalating series of bailouts and interventions. Your government has committed $9.7 trillion to these efforts just in the past year.Congress has been busy writing checks to everyone from Detroit automakers to Wall Street day traders. We're now nearing a historic $11 trillion debt and just like you, I'm getting pretty tired of these rushed multi-hundred-billion-dollar snap reactions. Months ago, we were told by President Bush and Congressional leadership that we needed to act NOW to save our struggling financial markets. Without my support, we rushed through a $700-billion bailout bill known as TARP that was supposed to unfreeze the stagnant credit market. Guess what? It didn't work. In fact, no one seems to be able to account for how the first $350 billion was spent, and yet Congress felt confident enough in their “responsible stewardship” of your tax dollars that they cleared the way for the second $350 billion that will surely follow the path of the first.When the Big Three automakers came calling for their cash, we were once again quick to give them whatever they needed as long as they looked like they were genuine in their requests. Keep in mind; we gave them $17 billion of your hard-earned money without a guarantee that they would reform the failing business model that put them in their precarious situation in the first place.And most recently, we watched day after day as the House and Senate negotiated a “stimulus” bill, arguing about a billion dollars here, and a billion dollars there. Remarkably, a few billion dollars doesn’t mean all that much when your final package still hovers around $800 billion.We poured more money -- money we don't have, money you don’t have -- down the drain in a sloppy and irresponsible spending spree that will leave the prosperity of our nation in great jeopardy. I understand that Americans are hurting, and I want to help them; but there are wiser ways to go about this. Congress should be working smarter, not faster. And, Congress should focus on passing legislation that will allow our private sector to do what it does best – create jobs and prosperity. But sadly, we're on the verge of placing free-market capitalism, the proven mechanism responsible for America's resounding wealth and prosperity throughout our nation’s existence, on the scrap heap of history.The government now controls the largest share of the US economy since WWII – nearly 25%. The federal share of the nation’s economic activity is one in four dollars. This is a trend that is antithetical to a free market economy and it is a direction that must be reversed. My fear, and the fear of the many others who have opposed these costly bailouts, is that in the long-run this policy will only make things worse and undermine the foundation of America’s economy. Remember, it's going to be your children and grandchildren who will be paying the bill for Congress’ irresponsible spending bonanza.The reason the US has been the world’s leader in business, medicine, technology, and commerce; the reason our citizens have enjoyed the world’s best quality of life, is in large part because of a free market system that rewards success, encourages creativity, is open to change, rewards good decisions and punishes bad, and that instead of redistributing wealth, grows it.This “stimulus” bill was touted as a package to create new jobs and get our economy moving again. But a closer look reveals a bill that got caught up in the ways of Washington, loaded with every lobbyist’s pet project — at the expense of programs and ideas that really could get the economy moving.Take investments in transportation and infrastructure, which could make a real difference to our economy.Projects like widening Interstate 94 or building the Stillwater Bridge could be a big boon to our economy and make a significant improvement in the quality of life for Minnesotans. The American Association of State Highway and Transportation Officials reported last year that there are more than 3,000 highway projects nationwide that could be ready for construction within 60 to 90 days. And, those are just highway projects.While America has watched the unemployment rate creep up, those employed in construction and construction-related jobs have watched it spike higher and more quickly. While it seems axiomatic that investing in transportation and infrastructure would provide new job opportunities for many unemployed construction workers, the truth is the benefit is broader than that.The U.S. Department of Transportation reported last year that every $1 billion in federal highway investment, when combined with the required state matching funds, supports 34,779 American jobs. Of that, only about 12,000 are actual construction jobs. The rest are in supplier industries or related economic sectors.Regrettably, the so-called “stimulus” package that was passed by Congress last week — without my vote — paid only lip service to transportation and infrastructure investments.The $792-billion package included $27.5 billion — or 3.4 percent of the funding — for highway and bridge construction. It spent billions of dollars for projects that do much less to stimulate job creation or economic growth. In fact, much was spent on things that you could reasonably say have no stimulative impact at all.What will $5.5 billion for new federal government office buildings or $570 million for climate change research do to help you and your family? What will $50 million for the National Endowment for the Arts — a 30 percent funding increase for the agency — do to help the economy.This bill included twice as much for 33 brand new federal programs ($95 billion) and twice as much for expansions of 73 federal programs that should have been addressed through the regular appropriations process. It did this at the expense of truly stimulative spending, like highway construction.I supported a Republican motion to reprioritize funding in the stimulus package to cut out wasteful spending and triple the money for shovel-ready transportation and infrastructure projects.Unfortunately, a majority of my House colleagues — under pressure from the Speaker of the House — rejected this motion. Similarly, a majority of my House colleagues — again, under pressure from House leadership — rejected an alternative package that would have stimulated the economy by putting money back into the hands of small businesses and families across the nation. Among other things, this alternative, which I did support, would have:Reduced the lowest individual tax rates from 15 percent to 10 percent and from 10 percent to 5 percent. In the 6th District, 272,306 filers would benefit from the reduction in the 10 percent bracket alone and 228,926 filers would also benefit from the other rate reduction. Allowed small businesses to take a tax deduction equal to 20 percent of their income. Nearly half a million Minnesota small businesses — each employing 500 or fewer employees — would benefit from this.
And provided a home-buyers credit of $7,500 for those who can make a minimum down-payment of 5 percent.
Unfortunately, this so-called “stimulus” package got so bogged down in pet projects that the real stimulus got shoved aside. As the Los Angeles Times noted, the bill did more to promote a social, policy agenda than an economic agenda. The final package included only 0.28% in small business tax relief. It spent as much on plug-in cars – which aren’t even on the market – as on small business tax relief. This single $2-billion example epitomizes the mis-prioritization in this bill.
But if this news wasn’t bad enough, it’s even scarier to look at what’s on the horizon. The Congressional majority isn’t limiting their reach and influence to only Wall Street and our financial sector.
As you all know, the White House and Congressional leaders are chomping at the bit to enact the “Employee Free Choice Act,” commonly known as “Card Check.”
There is perhaps no greater affront to the fundamental root of our nation’s democracy than denying an American their right to a secret ballot.
Yet, influential labor organizations see this piece of legislation as an ideal opportunity to put American industry in a stranglehold under the guise of worker rights.
We know that there is something more threatening taking place here, and big labor is gradually seeing their dream of a completely unionized American workforce become a reality. There numbers have been dwindling naturally. Card check will revive them.
Right now, legislation is making its way through the Congress, with the support of the Administration and all of the labor union lobbyists that would revoke a worker’s right to a secret ballot.
Under card-check legislation, if union organizers collect enough cards from employees indicating interest in a union, the union would be certified. Employees would be forced to make a decision about whether or not to support union organization right in front of their co-workers and right in front of the organizers.
And, there is much evidence of the use of intimidation, discrimination and even harassment in such circumstances. Under current law, such decisions are made by secret ballot with full confidentiality.
In fact, Congressman George Miller, a Democrat from California and the Chairman of the Education and Labor Committee, which has jurisdiction over this legislation, just held a large rally at the Capitol in favor of this legislation. And, President Obama’s pick for Labor Secretary, Congresswoman Hilda Solis, was not only a cosponsor of the card-check bill, but the treasurer of a lobbying organization whose priority was passage of card-check.
I am deeply concerned about this legislation and what it stands for. The right to a secret ballot is one of the most cherished of American freedoms and it should be protected.
Last year, I joined with organizations like the U.S. Chamber of Commerce – as well as groups that serve unionized employees like the Fraternal Order of Police, the American Hospital Association, and others – in opposing this bill. All of us are very concerned that this legislation not only lacks protection for workers, but destroys the cherished right to a secret ballot.
Regrettably, the Employee Free Choice Act passed in the House on March 1, 2007. But, the Senate failed to vote on it. And, now in the 111th Congress, a renewed push for passage is being fueled by support from the new Obama Administration.
To combat this threat, many of my colleagues in the House and I have put forth alternative legislation called the Secret Ballot Protection Act. It protects the right of workers to have secret ballot elections in determining whether a union will represent their workforce.
It prevents a workforce from being unionized solely based on card check and protects workers from being pressured or coerced to join a union. It even prevents a union from being officially recognized if formed without a secret ballot election.
At a time when our government spends billions of dollars to advance and support free elections around the world, what sense does it make to abolish federally protected private ballots in our own workplace?
Now that the so-called stimulus package has been passed, card-check will likely soon follow. The Democrat majority in the House and a new Democrat President in the White House have made clear over and over again that they consider November to be a mandate for change. And change is what they are bringing to the people. But the people will have to evaluate if this is the change for which they bargained.
President Ronald Reagan said it best when he said:
“Governments tend not to solve problems, only to rearrange them.”
I do have faith in the American people and see brighter days ahead. Americans may need a helping hand from time to time, but once we’re up, we like to walk on our own.
As our economy begins to rebound, which ironically has been made tougher now as a result of the $1.1 trillion in debt we’ve just accrued, it’s my hope that Americans will firmly reject the broad strokes of our federal government.
The best way to stimulate the economy and create jobs is to cut wasteful spending, reduce the tax burden on small businesses and families, and keep money in the private sector. Let’s make sure it stays that way.
Tuesday, February 24, 2009
Business Owners Face Soaring Local & State Property Tax Bills
BUSINESS OWNERS FACE SOARING
LOCAL AND STATE PROPERTY TAX BILLS …UP A COMBINED 8% STATEWIDE IN 2009
As Property Taxes Climb Across the State, Business Owners Already Contribute More Than Their Fair Share Business owners and tenants pay 31% of total property taxes collected on just 13% of statewide market value. “What governors and citizens alike need most is a growing economy that is creating jobs for the people and sending revenue to the capitol. Over the long run, the only way to have a healthy and growing economy is… to trust the people with their
own money, and create an environment where initiative and enterprise are rewarded rather than penalized.” ~ William McGurn writing for the Wall Street Journal …YET Minnesota business owners will still pay almost $3 per $100 of market value, while homeowners will pay just $1 for the same market value. Residential Homestead Commercial & Industrial Estimated
Market Value Local Property Tax Estimated Market Value State & Local Property Tax Source: House Research and Fiscal Analysis Departments Effective Tax Rates—taxes payable as a % of market value— have fallen for all Minnesota properties since the 2001 reforms… 30.6% 13.0% 46.7% 57.7% IN 2009 MINNESOTA’S EMPLOYERS WILL AGAIN BE TAXED TWICE ON THE PROPERTY THEY OWN OR OCCUPY FIRST, by their local city, county and school district
AND A SECOND TIME, by the State of Minnesota with a special tax paid only by owners and tenants of business properties, cabin owners and utilities— set to increase by 6.1%, for a combined increase of 8% statewide in 2009. *Levy automatically increases each year by the percentage increase in the implicit price defl ator (a measure of the level of price change in the U.S. economy). The levy was initially set at $592 million for taxes payable in 2002 and is estimated at $774 million for taxes payable in 2009. THE STATEWIDE GENERAL PROPERTY TAX RATE IS CALCULATED IN ALMOST THE SAME WAY AS OTHER UNITS OF GOVERNMENT CALCULATE THEIR PROPERTY TAX RATES. Local Units of Government Property Tax Calculation Statewide General Property Tax Calculation The STATEWIDE GENERAL PROPERTY TAX will raise $774 million in 2009—in addition to the property taxes those same business owners will pay to local jurisdictions. The STATEWIDE GENERAL ROPERTY TAX is set to increase by 6.1% in 2009, for a total increase in cost to employers of
$182 million or more than 30%, just since its fi rst payable year, 2002. For more information or additional copies, please contact Kaye Rakow, NAIOP Director of Public Policy, (952) 928-7461
PAYABLE MONEY RAISED BY YEAR THE STATEWIDE GENERAL PROPERTY TAX LEVY
2002 $592.0 (millions) 2003 595.0 2004 615.0 2005 625.0 2006 655.0 2007 693.0 2008 29.0
2009 (Estimate only) 774.0 Source: House Research and House Fiscal Analysis Departments
2009 Rate Increase 6.1% 30% Increase Since 2002
LOCAL AND STATE PROPERTY TAX BILLS …UP A COMBINED 8% STATEWIDE IN 2009
As Property Taxes Climb Across the State, Business Owners Already Contribute More Than Their Fair Share Business owners and tenants pay 31% of total property taxes collected on just 13% of statewide market value. “What governors and citizens alike need most is a growing economy that is creating jobs for the people and sending revenue to the capitol. Over the long run, the only way to have a healthy and growing economy is… to trust the people with their
own money, and create an environment where initiative and enterprise are rewarded rather than penalized.” ~ William McGurn writing for the Wall Street Journal …YET Minnesota business owners will still pay almost $3 per $100 of market value, while homeowners will pay just $1 for the same market value. Residential Homestead Commercial & Industrial Estimated
Market Value Local Property Tax Estimated Market Value State & Local Property Tax Source: House Research and Fiscal Analysis Departments Effective Tax Rates—taxes payable as a % of market value— have fallen for all Minnesota properties since the 2001 reforms… 30.6% 13.0% 46.7% 57.7% IN 2009 MINNESOTA’S EMPLOYERS WILL AGAIN BE TAXED TWICE ON THE PROPERTY THEY OWN OR OCCUPY FIRST, by their local city, county and school district
AND A SECOND TIME, by the State of Minnesota with a special tax paid only by owners and tenants of business properties, cabin owners and utilities— set to increase by 6.1%, for a combined increase of 8% statewide in 2009. *Levy automatically increases each year by the percentage increase in the implicit price defl ator (a measure of the level of price change in the U.S. economy). The levy was initially set at $592 million for taxes payable in 2002 and is estimated at $774 million for taxes payable in 2009. THE STATEWIDE GENERAL PROPERTY TAX RATE IS CALCULATED IN ALMOST THE SAME WAY AS OTHER UNITS OF GOVERNMENT CALCULATE THEIR PROPERTY TAX RATES. Local Units of Government Property Tax Calculation Statewide General Property Tax Calculation The STATEWIDE GENERAL PROPERTY TAX will raise $774 million in 2009—in addition to the property taxes those same business owners will pay to local jurisdictions. The STATEWIDE GENERAL ROPERTY TAX is set to increase by 6.1% in 2009, for a total increase in cost to employers of
$182 million or more than 30%, just since its fi rst payable year, 2002. For more information or additional copies, please contact Kaye Rakow, NAIOP Director of Public Policy, (952) 928-7461
PAYABLE MONEY RAISED BY YEAR THE STATEWIDE GENERAL PROPERTY TAX LEVY
2002 $592.0 (millions) 2003 595.0 2004 615.0 2005 625.0 2006 655.0 2007 693.0 2008 29.0
2009 (Estimate only) 774.0 Source: House Research and House Fiscal Analysis Departments
2009 Rate Increase 6.1% 30% Increase Since 2002
Legislative Update - MN Chamber
From: Minnesota Chamber of Commerce [mailto:mail@mnchamber.com] Sent: Monday, February 23, 2009 4:13 PMTo: info@monticellocci.com
Subject: Legislative Update -- February 23, 2009
February 23, 2009
For daily updates on key legislation being lobbied by the Minnesota Chamber of Commerce, visit www.mnchamber.com and click on “legislative bill tracker.” To contact your legislators, visit the Minnesota Prosperity Project at www.minnesotaprosperity.org.
STATE BUDGET: LEGISLATORS MUST HEAR FROM YOUMinnesota lawmakers are holding a series of town hall meetings this week in the Twin Cities to solicit comments on Governor Pawlenty’s 2010-2011 budget proposals. These forums, as they did last week in Greater Minnesota, are likely to attract special interests that oppose state budget cuts and support tax increases on those of us who create jobs. It is imperative to attend and reinforce the message that businesses cannot afford to absorb additional costs in this economy.
Our message is even more important as the state’s general fund shortfall is expected to reach at least $6 billion when the next financial forecast is released March 3.
If legislators don’t support the Governor’s plan, then ask them what their plan is for resolving the projected $4.8 billion shortfall for the FY 2010-2011 general fund without inflicting additional pain on businesses.
Business tax relief that can help create jobs in Minnesota is possible only if we speak up. Business tax increases are inevitable if we don’t speak up.
Specific times and locations are posted on the Minnesota Chamber Web site – www.mnchamber.com.
PRIORITY LEGISLATION TO LOBBYFollowing are bills that warrant your immediate attention at the Legislature:
CIVIL JUSTICEClass-action reform (HF 941, Thissen, DFL-Minneapolis): We support this bill which would allow an immediate appeal of class certification and a stay of proceedings while the appeal is pending. This is important because once a class is certified, the costs associated with class-action litigation – i.e. discovery – quickly add up. A stay of proceedings while the appeal is pending makes sure the class-certification decision was properly made before proceeding with other aspects of the litigation.
Insurance recovery (HF 417, Atkins, DFL-Inver Grove Heights/SF 528, Bakk, DFL-Cook): As introduced, this bill would allow a business that successfully sues its insurer for breach of contract to recover attorney fees and consequential damages. It also increases the prejudgment interest rate to 12 percent.
During the last three months, the Minnesota Chamber met with the proponents and opponents of the bill to try to reach a compromise. When it became apparent that the parties were not going to agree, we crafted a compromise that the Minnesota Chamber Board approved. We recommend that the prejudgment interest rate for commercial coverage disputes be increased to the greater of 4 percent or the one-year constant maturity treasury rate plus 3 percent. At present, the prejudgment rate is the greater of 4 percent or the one-year constant maturity treasury rate. The Chamber will oppose this legislation if it contains a one-sided “loser pays system” for awarding attorney fees, or if it awards consequential damages.
False Claims Act (HF 8, Simon, DFL-St. Louis Park/SF 82, Latz, DFL-St. Louis Park): We oppose this bill because it will likely increase litigation with businesses that have contracts with the state or a political subdivision. The bill’s goals are laudable – to improve fraud prosecution with state services and contracts. However, frauds can be prosecuted now under a federal false claims act, and the state has a version of a false claims act under its criminal code. This bill goes beyond the federal law in several areas, and would potentially subject any business that has a contract with state and local governments to expensive litigation.
HEALTH CARESingle-payer health care financing (HF 135, Bly, DFL-Northfield/SF 118, Marty, DFL-Roseville): We oppose this bill which would establish a government-run, single-payer approach to financing health care for Minnesotans. The business community is committed to discussions around market-based reform and competition for health care. We oppose this bill which proposes an undefined business health tax to pay for a single-payer approach to health care financing.
LABOR/MANAGEMENTPaid sick leave (HF 612, Lesch, DFL-St. Paul/ SF 461, Anderson, DFL-St. Paul): We oppose this bill that would require employers with more than 10 employees to provide one hour of paid sick time off for every 30 hours worked up to a maximum of 72 hours, which can be carried over year to year. For employers with fewer than 10 employees, the requirements are one hour of paid sick time off for every 30 worked up to a maximum of 40 hours, which also can be carried over. Paid sick time can be used to care for ill family members, both immediate and nonimmediate. Employees would have a broad ability to file civil suit if they are not allowed to use the time or if the employer retaliates against an employee.
We find no demonstrated need for mandating sick leave standards. Most employers already have some type of “leave” package and employers, in consultation with their employees, should be able to tailor benefits/leave packages to satisfy the distinctive needs of individual workplaces.
REGISTER FOR INSIDERS ISSUE SERIESWorkforce will be the focus of the first session of the Insiders Issue Series from 7:30 a.m. to 9:00 a.m. February 27 at The St. Paul Hotel. State Education Commissioner Alice Seagren, Senator Terri Bonoff (DFL-Minnetonka), and Representative Mindy Greiling (DFL-Roseville) will present their perspectives. The Minnesota Chamber is advancing a comprehensive K-12 education reform package to the Legislature.
Other sessions are: March 27 – Energy, Environment and the Economy; April 24 – State Budget; May 20 – Session Wrap-up (special time: 3:30 p.m. followed by 4:30 reception.)
Sign up now for the entire series – four meetings for only $100. Otherwise, each breakfast is $30 for members. Nonmember price is $50 per breakfast and $175 for the series. To register, contact Lisa Engdahl at (651) 292-4699, (800) 821-2230 or lengdahl@mnchamber.com, or online at www.mnchamber.com.
FEDERAL ‘CARD CHECK’The Minnesota Chamber is leading an effort to oppose the Employee Free Choice Act, otherwise known as “Card Check,” at the federal level. While we are working with our national partners like the U.S. Chamber and the National Association of Manufacturers, our members feel very strongly that this legislation undermines the principles of workplace democracy. Last week, we coordinated meetings with Congressman Collin Peterson and with Congressman Tim Walz attracting more than 100 business leaders in total. We also are trying to meet with Senator Amy Klobuchar. To learn more about the issue and to contact members of the Minnesota delegation, go to www.minnesotaprosperity.org or call Jennifer Byers at (651) 292-4673.
TAX REFORM COMMISSION RELEASES RECOMMENDATIONSThe Governor’s 21st Century Tax Reform Commission released its recommendations February 13. The business community was well represented on the commission membership including Dave Beito, president of Northern State Bank in Thief River Falls and treasurer of the Minnesota Chamber Board.
The commission was charged with providing recommendations involving long-term improvements in Minnesota's business tax climate. Its primary recommendations:
Reduce business tax burdens: Repeal the state corporate income tax; exempt 20 percent of active “pass-through” business income from taxation; conform to federal tax write-off provisions for business-related assets; replace the capital equipment sales tax refund with an up-front exemption; extend the capital equipment exemption to businesses that produce services subject to sales tax.
Improve the transparency of business taxation: Simplify the state property tax system; require a biennial “benefits-received” report of Minnesota business taxation.
Promote investments in innovation, entrepreneurship and emerging/high-tech companies: Overhaul the research-and-development tax credit; enact the Small Business Investment Act; enact an Early-Stage Investment Tax Credit; encourage low-income entrepreneurship and business creation loans.
Paying for reform: Extend the sales tax base to a broader range of consumer products and consumer services; increase the excise tax on cigarettes.
A copy of this report, and other information relating to the commission’s work, can be found at http://www.taxes.state.mn.us/mntaxreform/index.shtml.
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Subject: Legislative Update -- February 23, 2009
February 23, 2009
For daily updates on key legislation being lobbied by the Minnesota Chamber of Commerce, visit www.mnchamber.com and click on “legislative bill tracker.” To contact your legislators, visit the Minnesota Prosperity Project at www.minnesotaprosperity.org.
STATE BUDGET: LEGISLATORS MUST HEAR FROM YOUMinnesota lawmakers are holding a series of town hall meetings this week in the Twin Cities to solicit comments on Governor Pawlenty’s 2010-2011 budget proposals. These forums, as they did last week in Greater Minnesota, are likely to attract special interests that oppose state budget cuts and support tax increases on those of us who create jobs. It is imperative to attend and reinforce the message that businesses cannot afford to absorb additional costs in this economy.
Our message is even more important as the state’s general fund shortfall is expected to reach at least $6 billion when the next financial forecast is released March 3.
If legislators don’t support the Governor’s plan, then ask them what their plan is for resolving the projected $4.8 billion shortfall for the FY 2010-2011 general fund without inflicting additional pain on businesses.
Business tax relief that can help create jobs in Minnesota is possible only if we speak up. Business tax increases are inevitable if we don’t speak up.
Specific times and locations are posted on the Minnesota Chamber Web site – www.mnchamber.com.
PRIORITY LEGISLATION TO LOBBYFollowing are bills that warrant your immediate attention at the Legislature:
CIVIL JUSTICEClass-action reform (HF 941, Thissen, DFL-Minneapolis): We support this bill which would allow an immediate appeal of class certification and a stay of proceedings while the appeal is pending. This is important because once a class is certified, the costs associated with class-action litigation – i.e. discovery – quickly add up. A stay of proceedings while the appeal is pending makes sure the class-certification decision was properly made before proceeding with other aspects of the litigation.
Insurance recovery (HF 417, Atkins, DFL-Inver Grove Heights/SF 528, Bakk, DFL-Cook): As introduced, this bill would allow a business that successfully sues its insurer for breach of contract to recover attorney fees and consequential damages. It also increases the prejudgment interest rate to 12 percent.
During the last three months, the Minnesota Chamber met with the proponents and opponents of the bill to try to reach a compromise. When it became apparent that the parties were not going to agree, we crafted a compromise that the Minnesota Chamber Board approved. We recommend that the prejudgment interest rate for commercial coverage disputes be increased to the greater of 4 percent or the one-year constant maturity treasury rate plus 3 percent. At present, the prejudgment rate is the greater of 4 percent or the one-year constant maturity treasury rate. The Chamber will oppose this legislation if it contains a one-sided “loser pays system” for awarding attorney fees, or if it awards consequential damages.
False Claims Act (HF 8, Simon, DFL-St. Louis Park/SF 82, Latz, DFL-St. Louis Park): We oppose this bill because it will likely increase litigation with businesses that have contracts with the state or a political subdivision. The bill’s goals are laudable – to improve fraud prosecution with state services and contracts. However, frauds can be prosecuted now under a federal false claims act, and the state has a version of a false claims act under its criminal code. This bill goes beyond the federal law in several areas, and would potentially subject any business that has a contract with state and local governments to expensive litigation.
HEALTH CARESingle-payer health care financing (HF 135, Bly, DFL-Northfield/SF 118, Marty, DFL-Roseville): We oppose this bill which would establish a government-run, single-payer approach to financing health care for Minnesotans. The business community is committed to discussions around market-based reform and competition for health care. We oppose this bill which proposes an undefined business health tax to pay for a single-payer approach to health care financing.
LABOR/MANAGEMENTPaid sick leave (HF 612, Lesch, DFL-St. Paul/ SF 461, Anderson, DFL-St. Paul): We oppose this bill that would require employers with more than 10 employees to provide one hour of paid sick time off for every 30 hours worked up to a maximum of 72 hours, which can be carried over year to year. For employers with fewer than 10 employees, the requirements are one hour of paid sick time off for every 30 worked up to a maximum of 40 hours, which also can be carried over. Paid sick time can be used to care for ill family members, both immediate and nonimmediate. Employees would have a broad ability to file civil suit if they are not allowed to use the time or if the employer retaliates against an employee.
We find no demonstrated need for mandating sick leave standards. Most employers already have some type of “leave” package and employers, in consultation with their employees, should be able to tailor benefits/leave packages to satisfy the distinctive needs of individual workplaces.
REGISTER FOR INSIDERS ISSUE SERIESWorkforce will be the focus of the first session of the Insiders Issue Series from 7:30 a.m. to 9:00 a.m. February 27 at The St. Paul Hotel. State Education Commissioner Alice Seagren, Senator Terri Bonoff (DFL-Minnetonka), and Representative Mindy Greiling (DFL-Roseville) will present their perspectives. The Minnesota Chamber is advancing a comprehensive K-12 education reform package to the Legislature.
Other sessions are: March 27 – Energy, Environment and the Economy; April 24 – State Budget; May 20 – Session Wrap-up (special time: 3:30 p.m. followed by 4:30 reception.)
Sign up now for the entire series – four meetings for only $100. Otherwise, each breakfast is $30 for members. Nonmember price is $50 per breakfast and $175 for the series. To register, contact Lisa Engdahl at (651) 292-4699, (800) 821-2230 or lengdahl@mnchamber.com, or online at www.mnchamber.com.
FEDERAL ‘CARD CHECK’The Minnesota Chamber is leading an effort to oppose the Employee Free Choice Act, otherwise known as “Card Check,” at the federal level. While we are working with our national partners like the U.S. Chamber and the National Association of Manufacturers, our members feel very strongly that this legislation undermines the principles of workplace democracy. Last week, we coordinated meetings with Congressman Collin Peterson and with Congressman Tim Walz attracting more than 100 business leaders in total. We also are trying to meet with Senator Amy Klobuchar. To learn more about the issue and to contact members of the Minnesota delegation, go to www.minnesotaprosperity.org or call Jennifer Byers at (651) 292-4673.
TAX REFORM COMMISSION RELEASES RECOMMENDATIONSThe Governor’s 21st Century Tax Reform Commission released its recommendations February 13. The business community was well represented on the commission membership including Dave Beito, president of Northern State Bank in Thief River Falls and treasurer of the Minnesota Chamber Board.
The commission was charged with providing recommendations involving long-term improvements in Minnesota's business tax climate. Its primary recommendations:
Reduce business tax burdens: Repeal the state corporate income tax; exempt 20 percent of active “pass-through” business income from taxation; conform to federal tax write-off provisions for business-related assets; replace the capital equipment sales tax refund with an up-front exemption; extend the capital equipment exemption to businesses that produce services subject to sales tax.
Improve the transparency of business taxation: Simplify the state property tax system; require a biennial “benefits-received” report of Minnesota business taxation.
Promote investments in innovation, entrepreneurship and emerging/high-tech companies: Overhaul the research-and-development tax credit; enact the Small Business Investment Act; enact an Early-Stage Investment Tax Credit; encourage low-income entrepreneurship and business creation loans.
Paying for reform: Extend the sales tax base to a broader range of consumer products and consumer services; increase the excise tax on cigarettes.
A copy of this report, and other information relating to the commission’s work, can be found at http://www.taxes.state.mn.us/mntaxreform/index.shtml.
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Wednesday, February 18, 2009
Budget Shortfall
Get ready for impact of state budget cuts
By David C. Olson
Death, taxes and budget cuts. When asked about the things in life that are certain, the first two are the most common response. It’s time to add "budget cuts" to the list at least for 2009.
By this June, Minnesota will have a new biennial budget. The ledger must be balanced as required by our State Constitution. Right now the shortfall between expected revenues and spending in current law is $4.8 billion. After the February forecast, the gap will likely grow to at least $6 billion or almost 20 percent of the state’s general fund.
Budget cuts are as certain as the sunrise. Even if the state’s big-spenders have their way and we require our state’s job-producers to pay higher taxes, it won’t close a $6 billion hole. Reductions in expected state spending are inevitable.
Let me make it very clear that this will be painful. It is a lot more fun to increase spending than it is to make cuts. Given this reality, what should business leaders and chamber of commerce executives do? It is time to tell the public sector, including and especially its "vendors," to start immediately to figure out how to get the job done with reduced resources.
This is not a license to tell government to "run like a business." Its responsibilities are too broad. But some common-sense practices do apply. And, the sooner we share them, the better.
First, protect the customers. When a business faces trouble, its last resorts are reducing services and raising prices. Governments and their vendors apparently don’t understand. How many times do we have to hear that the first cuts will be police and fire protection, classroom teachers and plowing our streets? Far too often public officials go right to areas they know will scare their constituents. What are these officials thinking about? Politics, not their customers.
Second, protect your workforce. More often than not, layoffs mean good workers are permanently lost to the enterprise, and the affected workers and their dependents face chaotic, desperate times. When business improves – and it will – firms have to recruit and train all over again. A better route for all is for employers and employees to agree on reduced wages and benefits, sufficient to make it through "the night." The enterprise keeps and continues to serve its customers. The trauma of job loss is minimized. And the organization is ready to rebound with the economy. There is still plenty of pain, but it need not be fatal.
Third, start now. The new budget in June and the accompanying cuts are around the corner. Every organization that receives a state check – whether it is school aid, local government aid or Medicaid reimbursement – should act immediately to reduce personnel costs, and, if possible, other overhead expenses. The negotiations won’t be easy. Those who represent workers will predict dire consequences to customer service and offer tax increases as the only solution. Everyone should resist this public drumbeat and instead follow the example at thousands of businesses competing for private-sector business by protecting customers and keeping their employees even though it means lower wages and benefits
Budget cuts are inevitable. But, this time, government customers and the customers of organizations supported by state and local governments need not be victims.
Local chambers and their private for-profit members can make this happen. We should gather our elected officials and the executives who manage tax-supported institutions. We should make our expectations clear: Maintain services by retaining workers at reduced expenses. The old way that holds customers hostage to tax increases is history. Period. No excuses. No exceptions.
David Olson is president of the Minnesota Chamber of Commerce. For more information, visit the Web at www.mnchamber.com
By David C. Olson
Death, taxes and budget cuts. When asked about the things in life that are certain, the first two are the most common response. It’s time to add "budget cuts" to the list at least for 2009.
By this June, Minnesota will have a new biennial budget. The ledger must be balanced as required by our State Constitution. Right now the shortfall between expected revenues and spending in current law is $4.8 billion. After the February forecast, the gap will likely grow to at least $6 billion or almost 20 percent of the state’s general fund.
Budget cuts are as certain as the sunrise. Even if the state’s big-spenders have their way and we require our state’s job-producers to pay higher taxes, it won’t close a $6 billion hole. Reductions in expected state spending are inevitable.
Let me make it very clear that this will be painful. It is a lot more fun to increase spending than it is to make cuts. Given this reality, what should business leaders and chamber of commerce executives do? It is time to tell the public sector, including and especially its "vendors," to start immediately to figure out how to get the job done with reduced resources.
This is not a license to tell government to "run like a business." Its responsibilities are too broad. But some common-sense practices do apply. And, the sooner we share them, the better.
First, protect the customers. When a business faces trouble, its last resorts are reducing services and raising prices. Governments and their vendors apparently don’t understand. How many times do we have to hear that the first cuts will be police and fire protection, classroom teachers and plowing our streets? Far too often public officials go right to areas they know will scare their constituents. What are these officials thinking about? Politics, not their customers.
Second, protect your workforce. More often than not, layoffs mean good workers are permanently lost to the enterprise, and the affected workers and their dependents face chaotic, desperate times. When business improves – and it will – firms have to recruit and train all over again. A better route for all is for employers and employees to agree on reduced wages and benefits, sufficient to make it through "the night." The enterprise keeps and continues to serve its customers. The trauma of job loss is minimized. And the organization is ready to rebound with the economy. There is still plenty of pain, but it need not be fatal.
Third, start now. The new budget in June and the accompanying cuts are around the corner. Every organization that receives a state check – whether it is school aid, local government aid or Medicaid reimbursement – should act immediately to reduce personnel costs, and, if possible, other overhead expenses. The negotiations won’t be easy. Those who represent workers will predict dire consequences to customer service and offer tax increases as the only solution. Everyone should resist this public drumbeat and instead follow the example at thousands of businesses competing for private-sector business by protecting customers and keeping their employees even though it means lower wages and benefits
Budget cuts are inevitable. But, this time, government customers and the customers of organizations supported by state and local governments need not be victims.
Local chambers and their private for-profit members can make this happen. We should gather our elected officials and the executives who manage tax-supported institutions. We should make our expectations clear: Maintain services by retaining workers at reduced expenses. The old way that holds customers hostage to tax increases is history. Period. No excuses. No exceptions.
David Olson is president of the Minnesota Chamber of Commerce. For more information, visit the Web at www.mnchamber.com
Business Day at the Capitol - March 18, 2009
MINNESOTA BUSINES DAY AT
THE CAPITOL SET FOR
MARCH 18
Business Day at the Capitol gives you the chance to share your
views and concerns directly with state policy-makers. Join your
peers in St. Paul on March 18 as businesses from across the state
come together to talk with state leaders.
Participation is especially critical this year given the tremendous
focus on balancing the budget in the midst of the national
recession and legislative consideration of the Governor’s
proposed Minnesota Jobs Recovery Act.
Upward of 600 people come together as one statewide business
voice at this event which has become the largest lobbying day in
Minnesota. In its 16th year, it is an excellent venue for the business
community to speak with a single voice on common priorities.
Our top concerns this year are balancing the state budget by
cutting spending and restructuring delivery of public services,
ensuring a quality workforce by advancing reforms in the K-12
public school system, advocating for climate change legislation
to be addressed on the national and international levels, and
making certain that taxpayers receive the greatest value for
every dollar spent on the state’s infrastructure system.
Headquarters for this event is the Crowne Plaza St. Paul-
Riverfront, 11 East Kellogg Blvd., St. Paul. Two sessions are offered
to accommodate schedules. Session I runs from 7:30 a.m. to 1:30
p.m., and Session II runs from 9:30 a.m. to 3:45 p.m.
Both sessions will begin with opening remarks addressing the
legislative session followed by the chance to attend briefings
by Minnesota Chamber staff on the business community’s top
priorities. Personal meetings with two or three legislators also are
prearranged for interested participants. Both sessions join together
at noon for a lunch program where the Governor traditionally
gives an address. Cost for the day, including a continental
breakfast, lunch, meeting materials and transportation to and
from the Capitol, is $60.
The event also is an opportunity for local media to observe the
legislative process and report on where local lawmakers stand
on issues important to their local businesses.
Let’s demonstrate our commitment to protecting the priorities
of Minnesota’s business community – and thus the state’s
economic vitality – by joining with the Minnesota Chamber and
local chambers statewide for this event. It’s imperative that the
business community speak with one voice if we are to achieve
results at the Capitol.
For more information, or to register contact Sandy Suchy Monticello Chamber 763-295-2700.
THE CAPITOL SET FOR
MARCH 18
Business Day at the Capitol gives you the chance to share your
views and concerns directly with state policy-makers. Join your
peers in St. Paul on March 18 as businesses from across the state
come together to talk with state leaders.
Participation is especially critical this year given the tremendous
focus on balancing the budget in the midst of the national
recession and legislative consideration of the Governor’s
proposed Minnesota Jobs Recovery Act.
Upward of 600 people come together as one statewide business
voice at this event which has become the largest lobbying day in
Minnesota. In its 16th year, it is an excellent venue for the business
community to speak with a single voice on common priorities.
Our top concerns this year are balancing the state budget by
cutting spending and restructuring delivery of public services,
ensuring a quality workforce by advancing reforms in the K-12
public school system, advocating for climate change legislation
to be addressed on the national and international levels, and
making certain that taxpayers receive the greatest value for
every dollar spent on the state’s infrastructure system.
Headquarters for this event is the Crowne Plaza St. Paul-
Riverfront, 11 East Kellogg Blvd., St. Paul. Two sessions are offered
to accommodate schedules. Session I runs from 7:30 a.m. to 1:30
p.m., and Session II runs from 9:30 a.m. to 3:45 p.m.
Both sessions will begin with opening remarks addressing the
legislative session followed by the chance to attend briefings
by Minnesota Chamber staff on the business community’s top
priorities. Personal meetings with two or three legislators also are
prearranged for interested participants. Both sessions join together
at noon for a lunch program where the Governor traditionally
gives an address. Cost for the day, including a continental
breakfast, lunch, meeting materials and transportation to and
from the Capitol, is $60.
The event also is an opportunity for local media to observe the
legislative process and report on where local lawmakers stand
on issues important to their local businesses.
Let’s demonstrate our commitment to protecting the priorities
of Minnesota’s business community – and thus the state’s
economic vitality – by joining with the Minnesota Chamber and
local chambers statewide for this event. It’s imperative that the
business community speak with one voice if we are to achieve
results at the Capitol.
For more information, or to register contact Sandy Suchy Monticello Chamber 763-295-2700.
Tuesday, February 17, 2009
Employee Free Choice Act (EFCA) or "Card Check"
Important information for business owners to understand.
Tuesday, February 10, 2009
Foreclosure Prevention Counseling
Wright County Community Action (WCCA) is providing.....
Thurs., March 5, 2009 • 2-8 p.m. & Sat., March 7, 2009 • 12-3 p.m.
Monticello Community Center
FORECLOSURE PREVENTION COUNSELING
WCCA is a nonprofit agency offering foreclosure prevention information to Monticello residents at no cost! Please call WCCA at 320-963-6500 to schedule your 45 minute personal & confidential session.
(Must pre-register by Friday, February 27, 2009)
WHAT CAN I EXPECT:
In depth financial review and analysis
Budget management and possible options
Access to community resources
Assistance working with your mortgage company
Thurs., March 5, 2009 • 2-8 p.m. & Sat., March 7, 2009 • 12-3 p.m.
Monticello Community Center
FORECLOSURE PREVENTION COUNSELING
WCCA is a nonprofit agency offering foreclosure prevention information to Monticello residents at no cost! Please call WCCA at 320-963-6500 to schedule your 45 minute personal & confidential session.
(Must pre-register by Friday, February 27, 2009)
WHAT CAN I EXPECT:
In depth financial review and analysis
Budget management and possible options
Access to community resources
Assistance working with your mortgage company
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