A lawmaker in Osceola is chastising tax increases in Minnesota's proposed budget in an attempt to lure businesses eastward across the border.
In a letter sent to more than 100 Minnesota businesses, State Rep. Erik Severson of Wisconsin criticizes Minnesota Governor Mark Dayton for his budget proposal, which includes $2 billion in new taxes. He says Dayton doesn't seem to understand that high taxes drive companies out of business and out of his state. "Right now, with what Governor Dayton is proposing, it really puts Minnesota businesses on a ground where Wisconsin is going to be a lot more attractive for them."
But Dayton's administration has shot back at Severson. Press Secretary Katherine Tinucci says Severson should worry about what's happening in his state, because Minnesota's economy is faring better than Wisconsin's: "Indicators show that there is no correlation between tax levels and job creation, and in fact Minnesota's economy has been improving more than Wisconsin's has been improving in the last couple years."
According to the US Bureau of Labor Statistics, Wisconsin's unemployment rate of 6.6 percent is a full point higher than Minnesota's. The Federal Reserve Bank of Minneapolis predicts unemployment will remain higher in Wisconsin through 2013. Also, this year the Fed expects personal incomes to grow more in Minnesota than in Wisconsin. Severson says that's all the more reason to reach out to businesses across the border. "That's just another reason this is a good idea for us. If the economy has not been growing as fast here as it has in Minnesota then I would say hey, let's get something to happen to bring more businesses here instead of Minnesota."
Severson says the letters have just gone out and that he hasn't been contacted by any businesses yet.