FFM Bulletin 2/23/10

FFM’s recent report on taxpayers moving out of state has sparked a long-overdue public policy debate regarding the state of Minnesota’s anti-growth tax policies. The report, Minnesota’s Out-Migration Compounds State Budget Woes, shows that out-migration to lower tax states costs Minnesota’s state and local governments millions of tax dollars a year.

The report’s findings include:

• Between 1995 and 2007, the amount of income moving out of state was well over $3.6 billion.
• Had this income stayed in Minnesota, state and local governments would have collected an estimated $423 million in additional taxes.
• The states that have benefited the most from Minnesota’s out-migration have several things in common, including substantially lower (or non-existent) personal income tax rates and a more appealing business climate.

The report has attracted significant attention from both policymakers and media, including a good Pioneer Press editorial. And we appreciate the response from the many business owners across the state that have contacted us with stories of their own, anecdotal evidence that very much supports the empirical evidence contained in the report. We will continue to work with policymakers at the state and local level to make your voices heard.

In the land of 10,000 lakes, you hear a lot of fish tales. Yet a recent KSTP-TV investigative story into how the state’s biggest public fishing pier came to be built on a small obscure lake in potential violation of DNR regulations with hundreds of thousands of wasted tax dollars is all too true.  And FFM’s investigative director Tom Steward played a key role in exposing it.
 
The state’s trophy fishing pier measures more than a tenth of a mile long, easily visible on Google Earth’s satellite photo.  But rather than in Duluth, Walker, or Brainerd, it’s hidden away on a small, shallow Todd County lake known chiefly for bluegills. 
 
On the surface, everything about DNR’s Dower Lake project seems out of proportion—from its massive cost to taxpayers and hulking size to its enormous environmental footprint.
 
In response to questions from the Freedom Foundation of Minnesota, DNR staff acknowledged the supersized pier project essentially went forward under different rules than private developers and the public play by.  And did we mention the DNR is in the process of finalizing rules to further limit the size of your private dock?

When President Obama signed the $787 billion American Recovery and Reinvestment Act (ARRA) into law one year ago, he promised that of the “millions” of jobs it would create or save, 90 percent would be in the private sector.

One year later, the now $862 billion stimulus plan has clearly failed to deliver on that promise here in Minnesota. According to the state stimulus tracking website, over 65 percent of the jobs created/saved in the fourth quarter of calendar year 2009 were in education, the vast majority of which are public employees. Even prior to the fourth quarter of CY 2009, public education accounted for more than 60 percent of the package’s reported job creation in Minnesota.

Even Minnesota’s ARRA coordinator concedes the vast majority of jobs created or saved through stimulus funding were government jobs. Looking at the jobs breakdown, the state’s ARRA coordinator noted the data “would indicate that the stimulus package provided additional resources for local units of government to alleviate the need for them to lay off or eliminate positions.”

The administration has proven they’re perfectly capable of growing government; the question is whether they can do the same for the economy.

On Thursday, February 25 the Minnesota State Bar Association (MSBA) will host a training session on how average citizens can play a role in the process of developing administrative rules. The event will be held at the Embassy Suites in St. Paul.

Citizen participation in the regulatory process makes a very real difference. And for anyone who’s concerned about the growth of the regulatory state, or simply wants to guide how it develops in Minnesota, this one-hour breakfast could be an indispensible bit of training.

Click here to register or learn more about the training session.