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Minnesota House of Representatives

State Representative John Ward

375 State Office BuildingState Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
651-296-4333

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Posted: 2012-03-07 00:00:00
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E-Update

Legislative Update -- March 7, 2012

Dear Neighbors,

On March 5, the bipartisan Minnesota House Small Business Caucus unveiled their legislative agenda for the 2012 Session. I’m proud to be a member of this great bipartisan caucus and to be a chief author of two of the bills on the Small Business Caucus’s agenda.

We have dozens of small businesses in our district, and I regularly hear about their challenges. These bills are specific ways we can resolve issues and make a positive difference. Small businesses are a vital part of our economy and we should do all we can to address their needs so they can continue to grow and hire more Minnesotans.

I am the chief author of HF 253, a bill that would repeal accelerated pre-payment of state sales taxes for small businesses. Approximately 160,000 businesses in Minnesota pay this accelerated tax.

I am also the chief author of HF 1827, which would equalize the small business penalty interest rate with the personal penalty interest rate. Currently, small businesses pay a much higher penalty rate than individuals. This bill would lower the small business penalty to the individual penalty rate.

According to the US Small Business Administration, small businesses employ nearly 50 percent of Minnesota’s private sector workforce, making their recovery and future growth absolutely essential to our long-term economic success.

If we work together in a bipartisan fashion, we can get this work done for small business owners across our state and set out state up for a brighter tomorrow.

Here is the full list of bills proposed by the Small Business Caucus:


Taxes
• Reduce property taxes on small businesses by exempting the first $150,000 of value from the state property tax (To be introduced)
• Repeal the accelerated pre-payment of state sales taxes for small businesses (HF253)
• Allow an upfront sales tax exemption for capital equipment purchases rather than the current requirement to submit paperwork for reimbursement (HF1842)
Finance and investment
• Expand and enhance the Angel Investment Tax Credit program, including businesses requiring long term FDA approvals and expanding its use in greater Minnesota (HF1823)
• Assist small businesses with health insurance costs by continuing to support Section 125 group plans, continuing rewards for those paying 50% of the premium cost, and by removing an unworkable mandate (HF248)
• Equalize the small business penalty interest rate with the personal penalty interest rate (HF1827)
Removing barriers
• Allow small businesses under certain conditions to voluntarily request advisory inspections and remediate violations before penalties are imposed (To be introduced)
• Require the Department of Employment and Economic Development to provide a permitting and regulatory ombudsman to assist startups and small businesses (HF 2095)
• Provide relocation cost relief for business affected by eminent domain (HF1833)
• Allow casket sales by companies that are not funeral homes (HF482)
• Veteran-owned small businesses included in the state’s contract set-aside program (HF1821)

February Forecast

On February 29, Minnesota Management and Budget announced that the state has $323 million in additional money for the rest of this budget cycle. Current law states that $5 million of that money must go to budget reserves with the rest beginning to pay back the $2.75 billion borrowed from Minnesota schools.

While any surplus is certainly better than a deficit, our state is still left with billions in debt and deficits over the long-term. Last year’s final budget agreement — which I voted against — borrowed $700 million more from our schoolchildren, borrowed another $700 million through the use of tobacco bonds, and has left us with a $1.1 billion budget deficit next year. That deficit balloons to $2.1 billion when inflation is included.

In total, according to non-partisan House Research, it would take $5.339 billion to pay off our debt and deficits next year.

I fully support paying back our schools and kids — and the sooner the better. I also support balanced approaches to future budgets that don’t rely on short-term gimmicks. The time has come for lawmakers to sit down and dedicate themselves to the hard work of restoring Minnesota to responsible budgeting.

Post-Labor Day School Start

HF 2325, introduced by Rep. Connie Doepke, would allow schools to begin their school years before Labor Day. The language of the bill states that no school year could begin “on the Thursday or Friday immediately preceding Labor Day," but does not prohibit a school year from beginning at any other point, including well before Labor Day.

As you know, the tourism industry is huge for our district and for our state as a whole. Tourism is an $11 billion industry, generating $700 million in sales taxes every year for our state. More than 260,000 Minnesotans work in the tourism and hospitality industries as well.

This bill would negatively impact those industries and the jobs they provide. Not only that, it’s unnecessary. A pilot program to test if students would be more successful with an early school year start found no increase in academic achievement. This is a lose-lose proposition for our area and for our state.

I’m leading a bipartisan effort to defeat this bill. I will continue to fight like crazy to keep every job in our area and to keep those tourism dollars flowing into our district.

Rural Loan Forgiveness for Medical Professionals

For years, the Department of Health has run a program that forgives some student loan debt for medical professionals who choose to work in rural Minnesota. Many areas in Greater Minnesota, including ours, are very much in need of medical professionals — primary care doctors, specialists, pharmacists, and so on. This is an excellent program to encourage young medical professionals to work in Greater Minnesota.

Unfortunately, last year’s budget agreement slightly modified the definition of “rural,” affecting people who had been previously told that they qualified for the program, including some medical professionals in our district. Money has already been appropriated for this program and we need to fulfill the promise we made to these people.

I have introduced a bill, HF 2486, that would correct this error. The bill has bipartisan support and was referred to the Health and Human Services Finance Committee. I’m hopeful that we can pass this bill and enact it into law this session.

As the legislative session moves along, please contact me with your input, questions and concerns. Thank you again for the honor of serving you in the legislature.

Respectfully,

Representative John Ward
District 12A
828-3626

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