The Tax Conference Committee finished its work on Saturday night and agreed to a bill that includes a number of CGMC priorities. The bill still needs to be acted upon by the full House and Senate and sent to the Governor. The following CGMC priorities are included in the bill:
• Promotion of Angel Investment Credit in Greater Minnesota – This provision was carried in the House tax bill and sets a target for 30% of the credits to go to Greater Minnesota businesses. If the target is not achieved for a six-month period ending December 31, 2013, the credit amount would increase from 25% to 40 % for investments made in qualifying Greater Minnesota businesses.
• Greater Minnesota Internship Program – This provision is based on CGMC-sponsored legislation that would create an incentive for Greater Minnesota companies to hire interns from Minnesota colleges, universities, or technical schools. The program offers a grant to Greater Minnesota businesses for hiring interns to cover up to 40% of the intern’s salary, not to exceed $1,250 per intern. The program has $1 million for funding in 2013 and is funded at $1.25 million in 2014 and thereafter.
• Cities over 5,000 in population will receive the same amount of LGA in 2013 as they did in 2012. Cities under 5,000 in population will receive the higher of their 2013 current law formula amount or what they received in 2012.
The bill also includes a provision to which the CGMC objects, a new mandate that requires all cities and counties over 2,500 in population to provide new expenditure type reporting.
Several business tax reductions and credits are contained in the bill, including the removal of the automatic inflationary increase in the statewide business and seasonal recreation property tax levy, and increased funding for the Angel Investment Tax Credit and the Research and Development Tax Credit.
In total, the bill cost the state’s General Fund $48 million for the current budget ending July of 2013 and is expected to cost $145 million for the next biennium. Due to the unbalanced nature of the bill, it is unclear whether Governor Dayton will sign the bill (assuming it will pass both bodies of the legislature).
For complete language of the bill, please click here.
For a complete look at the spreadsheet detailing the bills spending and revenue changes, please click here.
For a look at the LGA run, please click here.