Addressing Minnesotaís business needs

Posted 8/8/01

Addressing Minnesotaís business needs

By Nancy Domaille

As Minnesotans continue to digest the results of the 2001 legislative session, I hear frequently the comment, ìYou business people scored big,î referring to the historic property tax relief reform endorsed by and signed into law by Governor Ventura. This ìscoreî was no lucky break or Hail Mary pass nor was it exclusive to business. Homeowners will see an average 25 percent property tax decrease with the higher percentages in greater Minnesota cities. Farm property, also, has had its tax burden cut while local governments received a substantial increase in state aid. All this comes in a package that delivers greater simplicity and accountability.

What business receives specifically is a long-overdue correction in the balance of market share versus tax burden. Prior to this legislative session business property comprised 15 percent of the value but faced 30 percent of the tax burden. With $180 million in immediate property tax relief and compression of classification rates, business share of the property tax burden is reduced, but still about 25 percent of the total.
Minnesota is also addressing the problem of competitive advantage. According to 2000 tax rankings, Minnesotaís commercial/industrial and apartment property tax rankings were still significantly higher than the national average. Rural commercial and industrial property fares particularly poorly compared to the rest of the nation. Preliminary numbers from the Minnesota Taxpayers Association show the new legislation will have a positive impact ñ hopefully dropping most categories of commercial industrial property from the top ten.
So what more does business want? What more do we need? Like property tax reform, there are several areas where we need to adjust our policies for competitive advantage and quality of life. As the Minnesota Chamber travels around the state this summer, we hear concerns that are shared by and reflect the concerns of the average Minnesotan.
The cost of health care tops the list as we look for ways to expand access and improve the quality and value of treatment. At best, this session maintained the status quo. Next session, legislators must be more aggressive in their approach to give health care purchasers more choices, to streamline or eliminate regulations that add cost but not value, and to reduce state-imposed health care taxes.
Transportation is another list-topper. In general, the consensus is that transportation funding must be increased through a stable source. Our members also say that money dedicated to highways should have a restricted and specific use that is directly related to road building and maintenance. What weíre hearing less is regional competition and more acknowledgment that congestion on major arteries, be it Interstate 94 or Highway 10, has an impact on everyone.
The business community continues to have a unified voice on education. Funding discussion must include reforms like performance measures for higher education and rewarding schools for improvement. We have helped reform the K-12 debate, building accountability through such initiatives as structurally balanced teacher contracts. We must also be engaged in the funding debate for higher education.
The Minnesota business community still wants and needs reforms in our civil justice system. We need to reform the law of joint and several liability so that a business must be at least 50 percent at fault before being required to pay 100 percent of lawsuit damages. Under current law, a business found to be only 16 percent at fault can be held liable for 100 percent of the damages. And we need to protect employers who provide accurate, written information about current or former employees from legal courses for action. The House passed legislation to reform joint and several liability law and now itís the Senateís turn to act. Job reference protection legislation was under debate in conference committee when the session ended. We fully expect House and Senate to agree to legislation early next year.
Rounding out the top business issues is a relatively new subject ñ electricity reliability. We are hearing more often and from diverse communities that Minnesota needs customer choice to promote investment in electricity generating facilities and as well to promote more conservation. The legislation enacted in 2001 was simply a tune-up of the regulatory system. This may not be enough and the business community is concerned that if we wait to see if the tune-up is the right approach, it may be too late. Critical electricity shortages will be upon us.
The list, as usual, is long and the changes not easily obtained. These are issues that pay dividends to all Minnesotans ñ the changes we still need for our long-term economic growth. We will all win if the Legislature acts.

Nancy Domaille, chair of the Minnesota Chamber of Commerce, is the CEO of Domaille Engineering, Rochester.