New Senate majority wants to roll back corporate income and property taxes by $200 million.
A week after assuming leadership at the Legislature, Republican lawmakers unveiled their first proposals Monday -- a modest mix of regulatory reform, a budgeting overhaul and $200 million in corporate tax breaks spread over two years.
"We want to make Minnesota the best place to start a business and to expand a business," said Sen. Geoff Michel, R-Edina, who sponsored the bill. "We want to plant a flag at every border that our state is open for business and we will do anything to help a job creator."
Senate Republicans jammed a news conference for the symbolic rollout of the new "jobs" legislation, which they said honored their campaign pledge to energize Minnesota's business climate, create new jobs and ultimately improve the state's financial condition. But the political showmanship came without any idea how many jobs might be created or where the state, which faces a gaping $6.2 billion budget hole, would find the additional money to pay for the immediate impact of corporate tax cuts.
"It seems like the Republicans are in some denial about the state's financial situation," said Senate Minority Leader Tom Bakk, DFL-Cook. "When the first bill Republicans introduce makes the deficit $200 million worse, it does beg the question: When are we going to get serious that the state has a serious, structural, financial problem?"
Republican Senate leaders want to cut the state's 9.8 percent corporate income tax in half over six years, roll back business property taxes to 2009 levels and speed up the review of permits.
Republicans would not speculate on how many jobs might be created.
"I can't commit to a job number at this time," Michel said.
In the last two months of 2010, the state took in $155 million in corporate income tax, about $5 million more than expected. About half of that was paid by out-of-state entities.
The move to cut taxes -- and create more red ink -- comes as state leaders are beginning to dig into the state's multibillion-dollar deficit, which has educators, local governments and the poor bracing for more cuts.
Republican House leaders steered clear of the tax issue Monday, instead focusing on plans to streamline review of business-friendly permits and switch to what's called "priority-based budgeting," when a government tries set clear, measurable priorities and then align them with the dollars available.
House leaders want to give the Minnesota Pollution Control Agency and the Minnesota Department of Natural Resources no more than 150 days to issue permits.
They also seek to eliminate district court review of permit appeals, instead sending them directly to the Court of Appeals. They also want to allow developers to craft their own environmental impact statements, rather than the local government.
Rep. King Banaian, a newly elected Republican legislator from St. Cloud, said the changes in budgeting will allow the state to prioritize more like Minnesota families do.
"When you manage your household budget, you learn to live within your means, you learn how to set priorities," Banaian said. "We are going to bring that concept to the state Legislature."
Away from the spotlight of the news conference, Republicans also introduced bills requiring a 15 percent reduction in the state workforce, a wage freeze for state workers and a repeal of the state's moratorium on construction of nuclear power plants.
DFL legislators on Monday said the Republicans's proposals cater to business interests while offering little immediate job prospects to the more than 200,000 Minnesotans who remain out of work.
"Minnesotans have real problems now that they need a solution to," said House Minority Leader Rep. Paul Thissen, DFL-Minneapolis.
DFL Gov. Mark Dayton struck a more conciliatory tone.
"We all share the same priority, making Minnesota work again and putting Minnesotans back to work," Dayton said. "I welcome all ideas on how best to achieve these goals. The legislative process provides the opportunity for all ideas to be discussed."
Baird Helgeson • 651-222-1288