Governor hopeful stops by Detroit Lakes
DFL gubernatorial candidate Tom Bakk, like most of the other candidates, said the state budget mess comes down to the economy.
As chairman of the Minnesota Senate tax committee, the Virginia, Minn., legislator said that taxes play a crucial role in the economy.
With a $1.2 budget deficit needing to be plugged by June 2011, Bakk said those cuts are tough.
"That's really serious, because we don't have two years left in the biennium," he said.
He said that the upcoming legislative session would be tough since he said Gov. Tim Pawlenty said that revenue increases are off the table.
"I'm the guy who has to raise the money to keep the budget in balance," Bakk said of his duties on the Tax Committee. "I need to let people understand how difficult that is."
While he said that many people think the state's main problem is its budget deficit, Bakk said that issue is a symptom of the poor economy.
"The real problem is we have an economy that is performing real poorly," he said.
The lack of revenue, Bakk said, comes from reduced income tax collections.
"You can't solve Minnesota's budget problems until you get the economy going," he said.
Bakk said most of the other candidates don't understand tax policy.
"There are potential impacts on Main Street," he said.
He said that while some say that the state's tax system discourages businesses from coming here, the decision to relocate comes down to the workforce.
"Can they find people with the skill set they need?" Bakk said. "If they can't, they will dismiss those areas."
While government plays a role, the business environment has to be right.
One help that government could provide is a bonding bill for infrastructure needs.
Bakk said that he asked Pawlenty to call a special session to get a bonding bill passed by the end of the year, a call that went unheeded. Instead, it will wait until the session starts in February.
"What is the point of doing that," Bakk said. "It makes a difference."
He said by waiting, most projects won't get started until the end of next summer at the earliest.
"What generally happens is that the governor holds the bonding bill hostage for something they want," Bakk said.
He said longer-term things the state can do is provide tax credits for angel investors to encourage investment in startups.
Wisconsin, he said, is benefiting from such a tax credit.
"Some people don't like business incentives like that, but the fact of the matter is that other states are doing it," Bakk said.
Bakk said he knows that times are tough. Current jobless issues are close to home.
He said when his children were little during the 1981-82 recession; he lost his construction job and was without health insurance. He said he ran out of unemployment benefits.
"It's very personal to me," Bakk said.
More info on Bakk's campaign can be found at www.bakk2010.org.