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From:bcdlori To: Mr.Brian Fritsinger Date:1/27/95 Time:17:08:20 Page 1 of 1 ECONOMIC DEVELOPMENT UPDATE DTED EDAM Minnesota Department of Trade Economic Development Association Economic Development of Minnesota Contact:Gene Goddard,612-297-1168 Contact:John Moon,612-854-6215 January 27,1995 1-800-657-3858 Volume 2,No.5 Governor. Governor Arne H. Carlson *Includes a $3 million increase for the * The Business Tracking Report for presented his FY 1996-97 budget to the Economic Recovery Loan Fund. the first quarter of 1994 showed the legislature this week. The following is a highest business formation level in two summary of key highlights: The Budget *Combines the Homestead and years. The number of new jobs Agricultural Credit Aid program (BACA) created by business start-ups increased *Holds the line on general taxes and and the Local Government Aid program by 19% while the number of jobs lost reduces fees by $17 million. (LGA) into a new County Homestead from business closings declined by 4% Block Grant program. Instead of funding over the previous quarter. *Holds growth rate in state government 3,700 separate units of government, the spending to 30 % slower than the projected block grants are delivered to 87 counties Legislature: The Senate Jobs. Energy growth in personal income (6.8 percent which will set up a process to distribute and Community Development versus 9.7 % over two years). this aid. Counties, cities and school Subcommittee on Employment (chair districts within each county will request Sen. Chandler) continued to hear *Reflects a decline in the Price of funding and will be required to justify that workers' comp. testimony. The Dept. Government from 18.4 'VG in 1995 to spending relative to funding requests from of Labor and Industry described its 17.61% by 1999. other municipalities. Local government workers' compensation fraud unit. aids and credits will receive $1.5 billion, a Since beginning operations in Jan. *Reflects a continuation of the phase-out 1.3 percent reduction from the previous 1993, 31 independent contractors, of the sales tax on capital replacement biennium."Virtually every study on insurance agents, employers and equipment yielding $68.3 million in reforming Minnesota's system of local individuals have been charged with savings to taxpayers over the next 2 years. government aid has concluded that the felony crimes, resulting in six state can no longer afford to dispense this convictions. In 1994 there were 551 — *Establishes a housing initiative that money without a revision of the aid complaints of fraudulent activity, up addresses the increasing housing shortage formula." Governor Carlson said. "It is from 412 in 1993. Of these in rural areas. Carlson proposes $15 time to reform 25 year-old spending complaints, 70% involved employee million in new funds for existing housing methods that are random and unfair." fraud; and 30% were filed against finance programs. The initiative will focus either an employer, insurance company on down-payment and equity assistance; *Includes S5 million for a workforce or a health care provider. gap financing for multi-family projects; readiness proposal designed to establish and funding for rehabilitation and closer ties between business, education Bill Introductions: development of local housing programs. and the student. The program will expand HF 204 (Dauner) Workers' Comp. youth apprenticeship options. It will be Reform: Provides for State rate *Recommends additional funding for the developed based on information provided approval, eliminates lump sum Minnesota Office of Tourism for travel by the labor market as to what specific payments, sets allowable increases in information services. skills and education a student needs for maximum weekly compensation. certain kinds of employment. HF 234 (Pugh) Workers' Comp. *Includes $1.7 million to set up a "One- Reform: rules for independent Stop Permitting" system to allow *Adds $2.1 billion for Higher Education, businesses to easily apply for many an increase of$79.4 million, with $61 contractors doing commercial or business licenses and permits million of the increase earmarked for the residential building construction. electronically. U of M. *Sets aside $180,000 for the MN Trade D FED: The Public Finance Authority information: Committee Information: Office to increase promotion of Minnesota authorized the sale of$89.5 million in House:612-296-2146 House:612-296-8611 business products abroad. bonds to be used to fund 35 loans for 55 Senate:296-0504 Senate:296-8086 municipal wastewater projects. The PFA To Obtain Copies of Bills: House:612-296-2314 *Requests $300,000 for Advantage MN. has achieved a AAA bond rating from Senate:296-2344 StandaId and Poor's. To make a change of address,phone or fax number *Requests $300,000 for the Job Skills please contact Gene Goddard,DTED Project Partnership for customized employee Coordinator at 612-297-1168 or 1-800-657-3858. Drafted by DTED. training for businesses.