Tuesday, May 1, 2012

Crunch Time in Minnesota for Taxes, A State Stimulus Package and Corporate Welfare for the Vikings Football Team

A Fascinating if Discouraging Story

In Minnesota, a normally quiet and politically peaceful state the drama over politics, economics and subsidies for a billionaire is getting very heated.  A deadline is approaching in which the legislature must decide whether or not to cut business property to taxes, to borrow money for infrastructure project and to provide the Minnesota Vikings football team with a nice taxpayer subsidized brand new stadium.

Here are the basic issues:

  1. Republicans want a cut in business property taxes even though the cuts would devastate a state budget that has already cut support for vital government services.

Republicans acknowledge that their tax breaks could have steep costs to the state budget in coming years, potentially causing deeper deficits in future budget cycles, but say the tradeoff would be an economic boon.

  1. Democrats want the state to borrow up to $700 million to finance construction and maintenance projects.

Bonding bills require a super-majority that the GOP can't muster without DFL help. DFLers say their price is closer to $700 million, too large to garner enough GOP votes to be viable. In the Senate GOP caucus, some rank-and-file members insist that no bonding bill and no stadium deal are better than bad ones.

  1. The Governor wants the state and local governments to pony up more than $400 million to fund a new stadium for the Vikings.

Last summer a clash between the Governor and the legislature resulted in a shutdown of state government, until the Governor caved.  He says he won’t do that this time.

Signaling how difficult it could be to reach an overall deal, DFL Gov. Mark Dayton emerged from his office Saturday afternoon to say Republicans must compromise or risk having the session implode.
"I learned last summer their view of compromise is doing things their way," Dayton said, referring to the three-week government shutdown. "That's just not going to work this time."

Well guess what Governor, once you have caved your credibility is largely shot.  So expect the Republicans to get their way, the Vikings to get a new stadium, the taxpayers to get hosed and those who need government services like education, health care, public safety, to do with less. 

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