ST. PAUL -- Improving the Minnesota economy will be difficult, a representative sponsoring the Republican House's top priority says.
Even so, Rep. Ron Kresha said Thursday, "there is no excuse to throw up our hands and admit defeat."
The Little Falls lawmaker took members of the House Greater Minnesota Economic and Workforce Development Committee through his 54-page bill that gives businesses tax breaks, cuts the time that the state has to issue environmental permits, examines rules that Kresha said "may be overzealous" and provides a way for communities to build homes to help reduce a housing shortage many greater Minnesota communities experience.
It was the first in-depth look at the bill Republicans say will encourage businesses to add jobs.
Kresha gained support from business advocates, such as the Minnesota Chamber of Commerce. No one spoke against the bill even though Democrats say much of it is nothing but a handout to businesses.
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No votes were taken Thursday and the bill will be considered by a number of committees and Kresha predicted it will change quite a bit as it moves through the process.
A key part of the Kresha bill is to give businesses tax breaks when they pay via individual income tax returns.
A higher tax the Democratic-controlled Legislature and Democratic Gov. Mark Dayton approved two years ago increased taxes on the richest Minnesotans. However, Republicans and most business leaders say that hurt many Minnesota firms because they pay company taxes through individual returns.
That meant some companies sustained a 25 percent tax increase, Mike Hickey of the National Federation of Independent Business told the committee. More than 90 percent of state businesses use individual tax returns, he said.
In parts of greater Minnesota, housing is a concern as manufacturers cannot find enough workers.
More homes are "necessary to accommodate job growth," Patrick Hynes of the League of Minnesota Cities said.
Hynes said cities such as Worthington, Luverne, Roseau and Thief River Falls have "employers who are ready and willing to expand operations but can't because of lack of housing."
"The cost of building market rate housing far exceeds that amount of money that is available to finance construction," Hynes said.
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Kresha's bill would provide grants to cities with housing shortages to develop apartments. It also gives companies tax credits for buying land for housing.
"This is one of the things I am most excited about in the bill," Kresha said.
Beth Kadoun of the Minnesota Chamber of Commerce agreed that something needs to be done to bolster greater Minnesota housing.
"We are beginning to hear more and more from our members in greater Minnesota how housing has become a bigger issue," she said.
Other provisions in Kresha's bill include:
- Cutting from 90 days to 45 days the Department of Natural Resources and Pollution Control Agency have to issue permits for many business needs.
- A method to make it easier to protest rules made by state agencies that businesses feel are burdensome.
- Providing a tax break as an incentive for research and development work.
- Giving a tax credit for some people who take jobs in science, technology, engineering, mathematics and long-term care fields.
