State Sen. Tom Bakk and State Rep. David Dill visited with the county board on October 23, answering questions and discussing issues that affect Cook County. (L-R) Commissioner Jan Hall, Commissioner Fritz Sobanja, Rep. Dill, Sen. Bakk, Commissioner Sue Hakes, and Commissioner Bruce Martinson.
State Sen. Tom Bakk and state Rep. David Dill met with the Cook County board on October 23, answering questions, responding to requests, and talking about the state of Minnesota’s finances. They were aware of all the issues the commissioners raised but did not promise what they could not deliver.
Veterans’ services
Commissioner Bruce
Martinson asked about reinstating veterans’ services funding that has been reduced.
The state is looking at a $1.1 billion deficit in the next biennium, Bakk said, which makes long-range planning difficult.
“We’re just always managing crises,” he said. The state has been paying schools 60 percent of what they owe them, essentially borrowing from the kids, he said.
After making property tax cuts, Bakk said, Gov. Jesse
Ventura left Gov. Tim Pawlenty with a $4 billion deficit, and
Pawlenty left Gov. Mark
Dayton a $5 billion deficit.
More funding is being expected from local taxes, and local governments have been “demonized” because of this, he said.
Dill said he had big plans when he was elected in 2002, but he has not had the budget to implement them. “The state has depleted everything,” he said, adding that if the economy l improves, the state budget ywill improve. “Both of us have a strong commitment to the veterans,” he said. He referred to competition for funding and said, “We’ll do the best that we ycan.”
Taxes lost to Internet sales
Minnesota is losing sales tax dollars when people buy over athe Internet, Commissioner
Fritz Sobanja said, and local rmerchants are losing out to
Internet sales. l “It’s disturbing to us,” said
Dill. People owe tax on what nthey buy on the Internet, rhe said, and people who get aaudited will end up paying it.
Bakk clarified Dill’s statement, saying that people who buy online are obligated to pay sales tax when their purchases total over $700 in a year, and they do this when they submit their income taxes. He attributed Best Buy’s financial problems to the fact that people go there to decide what they want to buy and then go online and buy it cheaper.
Bakk said he tried to get a bill passed that would require Internet companies to collect sales tax, and then he tried to “sneak” it into the stadium bill as a way of funding the stadium. It was shot down by opponents who claimed it was a tax increase, although it would not be an increase, he said—it would be money already owed.
IRRRB funding
Martinson asked Bakk and Dill for their thoughts on applications submitted to the Iron Range Resource and Rehabilitation Board (IRRRB) from Cook County—for a zip line business in Grand Marais, a senior housing project in Tofte, and a water pipeline from Lake Superior to Lutsen Mountains.
When he was on the IRRRB board, Dill said, they were deluged with “pie-in-the-sky” estimates on how many people the projects would employ. One of these came from one of the Cook County applications in this funding cycle, he said. He urged applicants to use realistic numbers.
IRRRB grants are “very, very competitive,” Dill said, with current requests amounting to four times more money than is available. He complimented
Cook County on actively pursuing economic development projects. Airport runway extension
Cook County Airport Manager Rod Roy handed Bakk and Dill a cost-benefit analysis on expanding the airport runway. Cook County’s airport is the only one between Duluth and Thunder Bay and between the Lake Superior shoreline and Ely that cannot handle U.S. Forest Service fire bombers, and this is a safety issue when it comes to forest fires, he said.
“This isn’t easy,” said Dill. He said getting funding for airports is “highly competitive,” although he thinks the proposed runway extension is a great idea. “You’ve got all kinds of reasons to get it,” he said, “but it’s not going to be overnight.” After the election, he said, they will know what they will have to work with.
Getting out of sales tax
Martinson asked for support in exempting counties from having to pay sales tax on equipment they are buying to achieve compatibility with the state’s new Allied Radio Matrix for Emergency Response communication system.
A sales tax exemption would cut more money out of the state budget, Bakk said.
Dill said the state granting a sales tax exemption amounts to the same thing as spending money.
Wetland credits
In the Northland, Commissioner Fritz Sobanja said, paying wetland credits can be prohibitive when someone wants to put up a commercial building, while people in farm areas are getting paid to create duck ponds on land that was previously drained.
This is a political issue, said Dill. He said he doesn’t know how to make this easier for the Northland, with all of its wetland.
Legacy funding
Dill reported on his efforts to bring more state Legacy Act funding to rural areas of Minnesota. He said the people from the Metro area “love to be up here, but they like to be hogs for [the funding] down there. …I’d like to do better for us.”
The balance of power in the legislature is moving more and more to the Metro area, said Sen. Bakk, because it keeps expanding.
“Economic development needs to be everyone’s focus,” Bakk said.
Bakk said they need to figure out how to conduct nonferrous mining without damaging the environment. Cook County benefits a lot from iron mining in northeastern Minnesota, he said, and it would benefit even more from nonferrous mining.
Seasonal resort tax status
Bakk asked the board where it stood on the recent reclassification of numerous Cook County lodging establishments from seasonal resort to commercial status, which will require them to pay more in property tax.
The businesses that lost their seasonal resort status did not meet the requirements for seasonal resorts, Bakk said, but the legislators are going to be asked to expand the description of what qualifies for seasonal resort status.
“I don’t want to lose any more businesses up here,” said Commissioner Jan Hall.
Dill said one hotel in his district closes a certain number of days per year in order to qualify as a seasonal resort because they couldn’t make up the difference in revenue if they stayed open all year. They have to lay off employees to do this, however, he said.
The seasonal resort classification was made to help keep seasonal resorts from being turned into condos as lakeshore property values went up, Bakk said. It wasn’t meant to give a tax break to every lodging establishment.
“There’s very, very broad implications to making changes to that,” Bakk said. He asked the board to furnish him with information on the effect that giving seasonal resort status to the re-classified resorts had on the rest of the taxpayers. He said he thinks the Department of Revenue interpreted the law correctly. They want to be supportive of local businesses, he said, but do not want to bring property taxes up for everyone else.
Voter ID
Commissioner Sue Hakes said if the state amendment requiring voter identification passes, she hopes Cook County’s lack of resources will be taken into account, because Cook County has few polling places and few handicap-accessible public buildings.
Bakk and Dill both said they were against the amendment, saying it outlines no provision for mail-in ballots. Dill said he supports requiring voter identification, but the language is not specific enough as it is written right now. Voting for it at this point would be like voting for Obamacare without having read the plan.
“The devil is in the details,” said Bakk.
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