Business lobby: few wins so far

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Business interests still hoping some of their legislative priorities will be addressed in waning days of session

On Monday Gov. Mark Dayton signed legislation designed to ease the regulatory burden on businesses.

The proposal, passed with bipartisan majorities in the House and Senate, relaxes numerous state environmental regulations. Animal feedlot permits, for instance, will now need to be renewed every 10 years rather than every five years.

Dayton praised the changes at the bill signing. “This takes us several steps further forward so that we can assure Minnesota businesses, and those who are looking at Minnesota, that we’re going to have the most expeditious review process available anywhere in the country, while at the same time assuring our citizens that they are going to be protected and that their natural environment’s going to be protected,” he said.

It was the second consecutive legislative session in which permitting changes offered a rare bit of bipartisan accord between the DFL governor and GOP legislative majorities over business interests. But numerous other items on the agenda of the Minnesota Chamber of Commerce, the Minnesota Business Partnership and other corporate advocacy groups remain unfulfilled with the clock running out on the legislative session.

“We have some critical weeks ahead,” said Laura Bordelon, senior vice president for advocacy at the Minnesota Chamber of Commerce. “We’ve had a number of disappointments.”

Overhauling rules for the state’s civil litigation system has been a top priority for the chamber in each of the last two legislative sessions. In 2011 a package of such “tort reform” measures stalled in the House on the final day of the legislative session. This year four bills cleared the House and Senate early in the session, but all were vetoed by Dayton.

In addition the chamber was seeking changes in rules regarding energy rates that could bolster businesses, particularly major manufacturers. But that proposal ran into opposition from the Minnesota Department of Commerce, according to Bordelon, and was not enacted.

LIFO repeal a key priority

Business interests have also been lobbying hard for abolishing the seniority-based layoff policy for teachers known as “last in, first out” (LIFO). Charlie Weaver, executive director of the Minnesota Business Partnership, argues that such changes are necessary to ensure that the state has a high-quality workforce. “We continue to have one of the largest achievement gaps in the nation,” Weaver said. “Getting great teachers in the classroom is really important to whether we’re going to be able to retain businesses in the future.”

Legislators wrapped up the conference committee on the proposal on Monday, and it’s likely to receive a final vote in both chambers this week. But on Tuesday, Dayton underscored the veto that seems certain to lie ahead, blasting the proposal as an attack on teachers. “Let’s try to pass legislation this session in cooperation with teachers, rather than in conflict,” Dayton said. “I’m very, very concerned for the effect this is having on teachers, their morale and the public’s perception.”

Another business priority that appears headed for a veto is the phase-out of the statewide business property tax. Both the Senate and House omnibus tax bills — although markedly different in their details — contain a proposal to begin eliminating the unpopular tax. But the House proposal pays for the initial reduction in revenues largely by reducing the state’s property tax refund program for renters, while the Senate version simply directs the administration to find budget savings to pay for the change. Neither proposal is likely to sit well with Dayton.

Not all initiatives favored by business interests are running into opposition from the governor. A proposal to enforce sales tax collections for online purchase was the top session priority for the Minnesota Retailers Association. Currently the state only has the authority to collect sales tax on Internet sales if the company has a brick-and-mortar store in the buyer’s home state.

The so-called Amazon tax has garnered bipartisan support, including from Dayton, but is not included in either of the omnibus tax bills. “We’re pretty frustrated by it,” said Brian Steinhoff, executive director of the Minnesota Retailers Association. “By inaction by this Legislature, the government’s really picking winners and losers, and the losers are the hometown team in this case.”

Southwest Corridor funding a regional priority

Other proposals that have floundered are of vital interest to the business community in certain regions of the state. Funding for the Southwest Corridor light rail transit line, running from Minneapolis to Eden Prairie, for instance, was among the top priorities of the Twin West Chamber of Commerce. Dayton’s bonding bill included $25 million in planning funds, but the project didn’t make the cut in the plans put forth by the House and Senate.

Bruce Nustad, president of the Twin West Chamber of Commerce, said the project risks losing its ability to tap some $600 million in federal funds in the near future if no state dollars are allocated this year. “There’s tough competition for these federal dollars,” Nustad noted. “We don’t want to lose our place.”

Business lobbyists are still holding out hope that some of their priorities might be addressed when legislators return from the Easter/Passover break. Some proposals that appear lifeless could be revived if there is significant bartering between Dayton and GOP legislative leaders as they look to claim victories ahead of the fall elections.

“It’s a political year,” Bordelon said. “It’s challenging to judge how all of these different bills are going to shake out.”

But Weaver also points out that it’s important to look at what legislative efforts have been stymied. For instance, he’s happy that efforts to raise taxes on businesses by eliminating certain tax credits haven’t been passed.

“Our goal coming in was, No. 1, do no harm,” Weaver said. “Let’s not do anything that makes it harder to grow jobs.”