The Legislature's DFL partisans hooted this year when Republicans took to referring to their business-friendly tax bills as "jobs bills." Though the House and Senate bills differ greatly, they both contain a phase-out of the statewide business property tax -- a costly, multi-year item that would deliver tax relief to all property-owning businesses, job-creators and job-eliminators alike.
To his credit, Gov. Mark Dayton insists that the tax bill must not add to future projected deficits. That does not bode well for the central GOP tax idea. But other, less costly options exist that would fit the "jobs" bill without busting future budgets.
One example comes from the Minnesota Historical Society. It is seeking extension through 2021 of a two-year-old tax credit for rehabilitation of privately owned historic buildings into income-generating property. That credit is set to expire in 2015 in current law. It costs the state treasury an estimated $15 million per year. Extending the credit won't alter the state budget until fiscal 2016.
The extension is warranted because renovation of historic property is a time-consuming undertaking, often requiring several years of lead time, explained Historical Society lobbyist David Kelliher. More projects will start in the next few years if developers are assured that the credit will be in place longer.
Historic property rehabilitation is also labor-intensive work. That was demonstrated during the first year that the credit was available. A study of the credit's impact by two scholars at the University of Minnesota Extension Center for Community Vitality found that the 14 projects that had received preliminary approval for the credit within 14 months of its enactment would eventually create 2,948 jobs and more than $152 million in income for labor. The total economic activity associated with those projects was estimated at $450 million, while the tax credit will cost the state $49 million through the life of the projects.
That's a $9.20 return for every $1 the state invests. I'd call that a fine return on investment. And I'd call a tax bill containing an extension of the historic rehabilitation tax credit a "jobs bill."