Threat of More Taxes Worries State Chamber Leaders

As predictably as the sun rises in the east, the latest annual legislative agenda of the Minnesota Chamber of Commerce  is calling on state lawmakers to reform state spending and taxation.

But what will be different when state lawmakers next month convene their 2013 session is that a single political party, the DFL, will control the executive and legislative branches for the first time since 1990.

And that worries Chamber leaders. Especially following news this week that Minnesota faces a projected $1.1 billion budget shortfall in 2014-15 and Gov. Mark Dayton is likely to push for raising income taxes on the state's top wage earners, according to a Pioneer Press report.   

"I'm nervous about that and a lot of other business owners are too," said Sanjay Kuba, a state Chamber board member who is vice-president at the Shoreview offices of GSS Infotech, an IT provider of software and infrastructure management services to businesses. "This is not the time to go for a fourth tier on personal (income) taxes to burden businesses with (more) taxes and regulations.

"We are not in a boom period but a tepid (economic) recovery," Kuba said. "The economy is still shaky."

Kuba spoke with Patch on Thursday as staffers and leaders of the Minnesota Chamber are conducting a media blitz, sharing their story about the upcoming legislative session. Representing 2,400-member companies that together employ about 500,000 people, the Minnesota Chamber is the state's largest business lobby.

According to Chamber statistics, 60 percent of its members are from the metro area including communities such as Burnsville, Edina, Hopkins, Minnetonka, Plymouth, Roseville and Woodbury.

During the 2013 session, the DFL control of the state's executive and legislative branches could mean business will "be playing more defense than offense" on its legislative issues, said Chamber communications director Jim Pumarlo.

Still, Pumarlo and Kuba said they see plenty room for common ground in tackling issues, noting there is widespread interest among policymakers to adopt policies that will create more private-sector jobs.

They added the Chamber believes the Legislature should first address state spending so there is an efficient delivery of services; then focus on tax reforms that help Minnesota keep and grow jobs.  

Kuba said that strengthening Minnesota's educational system and workforce systems is also important to the state's businesses, particularly those in the IT sector where the unemployment rate is hovering around 2 percent.

"This is an area where we might make progress with the governor," Kuba said.

Meanwhile, in a position paper, the Chamber stated its other legislative concerns and priorities include:

-Health care. The state should "implement a Minnesota-made health insurance exchange that facilitates, not regulates, an informed consumer marketplace."

-Regulations. "Businesses remain frustrated with the time and uncertainty of environmental regulations."

-Energy. "Energy costs were once a competitive advantage for Minnesota-based businesses. In many parts of our state, that advantage is eroding or gone entirely due to rising electric rates.

Rates should reflect the cost of serving the customer. Regulators should make this their mantra and, where necessary, statelaw should be changed."