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Minnesota Chamber lobbies for business-friendly regulations

The Minnesota Chamber of Commerce is hoping to make the state more competitive for business by removing what it says are excessive tax burdens unique to Minnesota and inconsistent labor laws across cities.

According to a 2016 business benchmarks report by the chamber, the state has some strengths that make it attractive for business, including strong growth in jobs and gross domestic product, innovation and educated workforce.

But when it comes to the cost of doing business, the state lags behind.

Minnesota has the highest business taxes in the country, as well as high health insurance and energy costs, according to the report.

The state imposes a business property tax that businesses pay in addition to their local tax rates. The tax is about 30 percent of the annual property tax bill for a business, and Minnesota is the only state that has it.

Jim Pumarlo, director of communications for the chamber, said businesses pay these regardless of whether they make a profit.

"If you make a buck or lose a buck, you still have to pay," he said.

The omnibus budget bills each contain provisions that will reduce this tax, which the chamber and its member affiliates support.

The Senate's version of the bill will exempt the first $100,000 in property value from the state property tax, and the House's version exempts the first $200,000.

"Minnesota is kind of an outlier for business tax compared to other states," said Beth Kadoun, vice-president of tax and fiscal policy for the chamber.

Uniform regulations

The chamber also is lobbying for the Uniform State Labor Standards Act, which has support from United for Jobs, an organization of local chamber chapters and associations advocating business interests in the state.

The act would prohibit local governments from setting a minimum wage higher than the state minimum or creating new benefit requirements or regulations.

The purpose of the act is to create uniformity of regulations across the state.

Pumarlo said a patchwork of regulations creates expensive administrative burdens for businesses, as they have to track what laws apply to which employees. When employees travel, the business has to track which laws would apply throughout an employee's day.

"We don't think any local government should dictate employee pay and benefits," said Pumarlo.

Currently, these laws only exist in St. Paul and Minneapolis, but Duluth also is considering its own set of labor regulations.

"It's just waiting to come to a city near you," Pumarlo said.

The House passed the bill and the Senate companion bill is in its second reading.

Kevin Killough

Kevin Killough is the business reporter for the Grand Forks Herald. You can reach him with story tips, comments and ideas at 701-780-1244.