House OKs jobs spending

Published 11:00 am Wednesday, April 17, 2013

The Minnesota House on Monday approved spending increases on job training and business development programs that supporters said are aimed at creating jobs.

The centerpiece of the House’s jobs, commerce and housing finance bill is a more than 50-percent boost in spending in the next two years for the state Department of Employment and Economic Development. The bill’s author, St. Paul Democrat Rep. Tim Mahoney, said it’s a deliberate effort to foster employment growth by spending more on job training, grants and loans to small businesses, scholarships and apprenticeships and other economic development programs.

“For the last 10 years, the Legislature has been cutting economic development,” Mahoney said.

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The House voted 75-57 in favor of the bill, with just two Republicans joining the majority Democrats in passing it.

House Rep. Shannon Savick, DFL-Wells, said she is pleased with the bill that passed and noted that it included legislation that she had proposed earlier in the session.

“I think it’s a really good bill that will offer a lot for southern Minnesota,” Savick said.

Specifically, the bill includes $20 million for the Minnesota Investment Fund that businesses thinking of starting up in the state can borrow on a low interest rate from DEED, Savick said. The funds can be used with other city or state funds.

She said she was pleased with a separate $18.5 million fund that would give state grants to businesses if they commit to hiring additional employees and making large investments in capital. The grants aren’t paid until those employment and investment goals are met.

Former state Rep. Dan Dorman, R-Albert Lea, who now works as the executive director of the Albert Lea Economic Development Agency, said he wished there was more money in the fund, and he is afraid the money will be spent by the metro cities.

He said he also wished there had been legislation calling for an internship credit and a fix to the angel investment tax credit.

Other elements in the bill were:

• $140 million to fund the employment and economic development office for 2014-15. That’s $5 million more than Gov. Mark Dayton requested for the agency. In 2012-13, the agency’s state funding was about $83 million.

• A $450 million reduction in taxes that employers must pay into the Unemployment Insurance Trust Fund.

• A $1.5 million funding boost for the Minnesota Trade Office, which has the mission of helping the state’s businesses tap into overseas markets. The money is meant to help the office open three additional overseas locations on top of an existing office in China.

• A provision that would extend state unemployment insurance benefits for up to three years for workers who are locked out by management in contract disputes, a pertinent discussion after recent high-profile lockouts at American Crystal Sugar and both Twin Cities professional orchestras. House members approved amendments that would exempt locked-out professional athletes and people who earn more than $150,000 a year from being eligible for those benefits.

Reps. Bob Gunther, of Fairmont, and Jim Abeler, of Anoka, broke with their party to support the bill, with Gunther saying he believed it would create new jobs.

— The Associated Press contributed to this report.