[Mpls] Jim, Lori Strudevant, the Strib Editorial Board and the Hennepin Co Board want toignore MSA 297A.99

[David Brauer]

Dann Dobson writes:

> "Subd. 3.    Requirements for adoption, use, termination.
>   (a) Imposition of a local sales tax is subject to approval by
>  voters of the political subdivision at a general election."
> 
> The legislature, in their wisdom, put this law in place to protect
taxpayers from crazy
> schemes, such as the Hennepin County Board has proposed for the Twins
Stadium and the
> insane proposal of the Anoka County Board to raise the sales tax up in
their county by .75%
> to pay for a new Vikings stadium. 

Dann is absolutely right, but with a couple of caveats.

1. The state law he cites is not in the Constitution - it's a legislative
act that the current legislature and governor can undo or grant exceptions
to. Such exceptions happen all the time, and are perfectly legal.

2. The act Dann cites was enacted as part of the "Minnesota Miracle." The
Miracle's goal — for those of you who don't go back to the good old days
when Wendy Anderson and the big fish appeared on the cover of Time — was to
push spending onto the progressive, statewide income tax and away from
regressive local property and sales taxes.

To keep localities from undoing the state's policy, the referendum
requirement was added, to make it harder to institute such a tax.

Trouble is, the Miracle has been steadily gummed to death over the years -
especially recently, when the state has refused to fund spending via the
income tax, pushing costs onto localities whose only revenue-side tools are
the property tax and sales tax.

Therefore, the philosophical underpinning for the higher sales tax hurdle -
the referendum - basically no longer exists. (I'm betting many sales tax
referendum proponents would oppose a referendum requirement for property
taxes - which I think is logically inconsistent. Both are regressive taxes.)

Personally, I don't see why the city of Minneapolis should go to the state
to raise the sales tax, as they have to in the recent initiative to fund
more cops & firefighters. Since the state has put us in this box, they need
to give locals unfettered taxing power to get out.

In other words, the referendum question is bigger than the stadium. I think
the referendum requirement is passé - even if the stadium wasn't the issue.

Do I think increased use of the sales tax is good public policy? No. I like
the Miracle and believe the progressive income tax should be raised at the
state level, Local Government Aid should be restored as a way to equalize
property-tax wealth. That means for cities such as Minneapolis, local
property taxes (primarily education-related) would be allowed to fall.

However, going back to that philosophy means changing the Guv and
Legislature - which can't happen until 2006 (if then).

Sales-tax referenda may seem great now, but I'd argue they no longer make
sense and deny us an alternative to the property tax.

David Brauer
Kingfield