2010 Session Begins
Today was the start of the 2010 legislative session. The Minnesota Senate has laid out an ambitious agenda focused on balancing the state’s budget and growing new jobs in Minnesota.
In November, Minnesota finance officials released the state’s most recent economic forecast, which showed the state faces a projected $1.2 billion budget shortfall in the current two year budget cycle. The report states that lower than expected income tax revenue – caused by the sluggish economy and high unemployment – are responsible for 70 percent of the shortfall.
Even more troubling, the forecast showed the fiscal problems for the state will only worsen in the next biennium. During the 2011 Legislative Session, the state is expected to face a budget deficit of $5.4 billion, even before considering inflation. When inflation and other spending pressures are factored in, the projected deficit could top $8 billion.
The legislature will be moving quickly to pass a series of bills aimed at jump starting the state’s economy including:
• A bipartisan capital investment package that will make statewide investments in colleges and universities, transportation projects, and other public infrastructure. The bill would put thousands of Minnesotans back to work during the upcoming construction season, and support long-term economic development in every region of the state.
• A series of bills designed to spur private investment in the state, including an angel investment tax credit that would offer tax incentives to investors who provide capital to start-up companies in emerging industries, such as the biosciences and renewable energy.
• A broader jobs package, supported by labor and business organizations, designed to stimulate the state’s “vertical construction” industry, which includes construction and rehabilitation of residential, commercial, and industrial infrastructure.
Passing the capital investment bill, a jobs bill, and tackling the budget shortfall with an eye on the long term budget solutions will be the main focus of the session. It will be difficult but necessary work.
