State Sen. Tom Bakk is a Democrat who doesn’t put spending for more government programs or higher taxes to pay for them at the forefront of his 2010 gubernatorial campaign. It’s jobs — growing the state economy through more jobs.
Thursday the Senate Taxes Committee chairman called for jobs creation by putting out a state public works bonding bill in December and not waiting until the start of the 2010 session in February, or letting politics take the bill out to April or May. That’s only part of his push for jobs.
"You cannot raise $6 billion or $7 billiono of revenue," Bakk, DFL-Cook, told me Thursday in a telephone interview. The 2010 Legislature will begin grappling with a budget issue that will hit lawmakers square in the chest in 2011 — a potential budget deficit that could reach $7 billion in the next biennium. Bakk says the difference can’t be made up by raising taxes alone. "You just can’t raise that much tax revnue."
Maybe a third of it can be raised through higher or different taxes, he says. "But then what about the other piece? I would argue the other piece is about getting the economy going. What we’re at risk of … is the whole Legislature is up for re-election, the governor’s checked out and we’re at a very high risk of having a kind of do-nothing legislative session."
Bakk said he met early this fall with the leaders of the Minnesota Chamber of Commerce and the Minnesota Business Partnership and others for input on how to get Minnesotans back to work. "I’m willing to do something to try and stimulate this economy," he told them. "I was interested in knowing what is the business community willing to support. Much like the transportation discussion, when the business community decides they want something to happen at the Capitol — looked at what happened with transportation, they were willing to part company with the governor."
He referred with state business groups joining DFL lawmakers — and six House Republicans — to approve of a gasoline tax increase because of pressing state road, bridge and transit issues, which occurred by overriding Pawlenty’s veto.
"I think right now we have a deep enough recession that the business community should be willing to support some kind of economic stimulus to try to get this economy going," he said."I have some tax credits I’d like to have a discussion with the business community about."
* "Angel Investor" investment tax credit — a 25 percent tax credit for investments in a qualified high-technology, biotechnology or medical device, or green manufacturing business. Qualified businesses must have at least 80 percent of its employees and payroll in Minnesota, less than 25 employees total, gross receipts less than $2 million a year, and be in operation for less than 10 years.
* Historic structure rehabilitation credit — a tax credit equal to 20 percent of the total costs of rehabilitation for historic structure rehabilitation projects. Qaulified properties must be certified historic structures in a certified historic district.
* Small business investment tax credit — create a non-refundable tax credit against the insurance premiums tax for insurance companies that invest in Minnesota small business investment companies. The credit would be up to 80 percent of original investments. Quaified businesses must have no more than 100 employees, 80 percent of which must work in Minnesota.
* Upfront sales tax exemption on capital equipment — manufacturing businesses currently must file a refund application to receive the exemption. An upfront exemption on sales tax for capital equipment would free up money to make business expansion more bankable.
"I just think all of us sitting around on our hands here and waiting for Tim Pawlenty to ride out of town 14 months from now would be a pretty big mistake," Bakk said. "We’re all going to be here when he’s gone. We’ve still got this problem to deal with — the struggling ecomomy, the budget deficit. Not taking the opportunity to try to take a nick out of it this session and try to set the table to stimulate some recovery I think would be a mistake."