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Jobs bill heads to gov.
Willmar Minnesota 2208 Trott Ave. SW / P.O. Box 839 56201

ST. PAUL -- Up to 12,000 people could find new jobs in small businesses, rejuvenating historic buildings and other Minnesota business segments, supporters of a Legislature-passed jobs bill claim.


"People are waiting for this to happen," House Tax Chairwoman Ann Lenczewski, DFL-Bloomington, said during Monday debate.

Lenczewski said the bill could send 5,000 to 12,000 people back to work in a tough economy.

The House passed the bill 112-20 and the Senate 58-3.

In a large part, the bill provides tax credits to people investing in small businesses and old buildings by eliminating a $30 million program originally designed to help poor Minnesotans afford gasoline tax increases.

The bill would establish tax credits to encourage business development, and thus the hiring of workers, at businesses supported by "angel investors," a Mall of America expansion, repairing historic buildings, keeping a Ford plant in St. Paul, building wind turbine manufacturing plants in Duluth and on the Iron Range, increasing research and development and for recreational and tourism purposes in northwestern Minnesota.

Angel investor tax credits long have been sought. The investors are called "angels" because they provide money to fund promising business ideas.

The bill has the support of many business-related organizations.

"That reflects a bill that is very much needed," said Sen. Kathy Saltzman, DFL-Woodbury. "My hope is when we see those results, when we see those companies begin to grow and set up roots in Minnesota, that we consider expanding the program."

Sen. Tom Bakk, DFL-Cook, lamented the state's unemployment numbers and the expiration of hundreds of Minnesota families' unemployment benefits in recent weeks. He said the bill is necessary to help get many of those people back to work.

Bakk, the Senate Tax Committee chairman, recounted the modest beginnings of two Minnesota companies, 3M and Medtronic, and said the angel investment tax credit could help entrepreneurs start the next great Minnesota companies.

Those potential business owners need tax credits because right now they cannot go to banks with nothing more than just an idea, Bakk said.

"There are a group of very creative, innovative Minnesotans who have ideas that may lead to new, successful startups in Minnesota," Bakk said. "I do believe the angel credit could lead to the creation of the next Medtronic or 3M here in Minnesota."

Gov. Tim Pawlenty sent House leaders a letter saying he expects to sign the bill, primarily because it includes the angel investor tax credit he has wanted.

"While I continue to believe we must do much more to make Minnesota attractive to job creators, this bill is at least a step in the right direction," Pawlenty wrote, adding that he still would like to trim business taxes.

Lawmakers representing inner city areas complained that the low-income fuel tax credit was used to fund angel investors, who are wealthy.

"What we are saying to low-income people is we can make you a promise and now we can take it back," Rep. Bobby Joe Champion, DFL-Minneapolis, said. "We're saying we don't want them on welfare, but we are doing everything we can to make their lives worse."

Senate testimony on the matter last week showed that each person would receive $12.50 through the fuel provision, with Democrats and Republicans agreeing that was not enough to help a poor Minnesotan, but when combined the $30 million could send people to work.

Andrew Tellijohn contributed to this story. Tellijohn and Davis report for Forum Communications Co.

Don Davis
Don Davis has been the Forum Communications Minnesota Capitol Bureau chief since 2001, covering state government and politics for two dozen newspapers in the state. Don also blogs at Capital Chatter on Areavoices.