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Update from Representative Jenifer Loon
March, 2009
Greetings to my fellow members of the Eden Prairie Chamber of Commerce. As a first-term
legislator, my first few weeks “on the job” have been jam-packed with meetings and intensive
briefings on programs under the jurisdiction of the Committees on which I serve. The analogy of
“drinking from a fire hose” is often used to describe the experience—and is very accurate given
the volume of information new members are trying to absorb. Right now, much of our work is
occurring in Committee as bills are beginning their progression through the legislative process.
I’ve been selected to serve on the Tax Committee, K-12 Education Policy Committee,
Environment Policy Committee, and the Crime Victims/Criminal Records Division of the Civil
Justice Committee. I’m especially pleased to have been chosen to serve on the full Tax
Committee, one of only three freshman legislators given that assignment. It will provide me
with a front line opportunity to fight for proposals to lower the tax burden on Minnesota’s
families and job creators.
The Legislative session which began on January 6th is predicted to be one of the most difficult
in recent memory. The task before us is to craft a balanced budget for the 2010-2011 biennium
in the wake of a deficit that is likely to be in the $6 to $7 billion range when the new forecast is
released in early March. A deficit of this magnitude is approximately 20 percent of the State’s
two-year budget. Governor Pawlenty has put forward his proposal for a balanced budget.
Incorporated into his combination of spending reductions and reforms to streamline and
consolidate government functions, are the Governor’s initiatives to enhance the future vitality
and competitiveness of our State’s economy. His intentional focus, despite the difficult budget
environment, on measures to encourage private sector job creation and position Minnesota
companies to succeed in the regional, national and global arenas in which they compete are not
only commendable, but necessary, to our State’s future.
Key among the components of the Governor’s initiatives are a gradual reduction in the
corporate tax rate, replacement of the capital equipment sales tax refund with an upfront
exemption, a capital gains tax reduction for investment in small businesses, and other measures
to encourage private investment in Minnesota businesses—both large and small. The Tax
Committee has held several hearings to study and debate these proposals. Many of the
provisions, in whole or part, were echoed in the recommendations of the 21st Century Tax
Reform Commission, which released its report on February 13th (a copy of the report may be
downloaded from http://www.taxes.state.mn.us/mntaxreform/index.shtml). While these
recommendations are certain to be controversial—it’s critical that dialogue begin on whether or
not our current tax structure contributes to, or inhibits, the creation of jobs in our State. To quote
from the Tax Reform Commission’s report, “Only business and private investment can create the
wealth necessary to drive growth across the private, government and nonprofit sectors and
maintain that quality of life for all workers and their families.”
In addition to proposing changes to our tax policies that would encourage private sector job
creation, the Governor has also identified a strong K-12 education system as critical to the future
of our state. Minnesota has long been able to boast a highly-educated workforce as one of our
best resources. With the demographics of our State changing, it’s even more important that our
schools educate every child to their full potential. We now have more “baby boomers” retiring
than we have children entering school. As fewer workers will be entering the workforce to
replace the retirees, it’s critical that workers have the skills to perform the jobs of the future. At
the same time, our schools are facing unprecedented challenges, with more diverse student
populations and a disturbing achievement gap existing between minority and non-minority
children. By largely holding K-12 education funding harmless from the spending reductions
proposed in other areas of the budget, the Governor has noted the essential nature of their
mission. He also expands his “pay for performance” program, known as Q-comp, to incentivize
teachers and schools to achieve better results in educating students to increasingly rigorous
academic standards. Again, the specifics of these proposals are not without controversy, but the
core idea is widely accepted. Excellence and accountability in our public schools is essential for
our state’s economy, and our future.
Tax policy and education are two broad areas of discussion surrounding the budget debate,
and there will be many other issues of concern raised during this session. As community and
business leaders, I encourage you to stay in frequent contact with me to share your views and
opinions on matters before the legislature. You can email me at [email protected], or
call my office at (651) 296-7449. I have also started sending out weekly updates on what’s
happening at the legislature. Just drop me an email if you would like to be added to my email
newsletter list. Thank you for the privilege of serving you in the State House. I look forward to
receiving your comments and advice on how best to keep your businesses, and our State, moving
forward.
Jenifer Loon
State Representative
District 42B, Eden Prairie