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 Response Page - Stinson  Interview -      


These comments are responses to the questions listed below,
which were generated in regard to the
Tom Stinson Interview of
10-16-09.
.

 
The Questions:

1. _7.8 average response_____State aid to cities is a significant state budget item.  On a scale of (0) most disagreement, to (5) neutral, to (10) most agreement, what is your view on whether, to help balance the state budget, the Minnesota Governor and Legislature should redesign state aids to cities?

2. _8.3 average response_____ Many individuals lose income when they retire, thereby reducing their taxes and, consequently, reducing state income and sales tax collections.  On a scale of (0) most disagreement, to (5) neutral, to (10) most agreement, what is your view on whether the significant increase in numbers of Minnesota retirees will have a long term effect on state income tax and sales tax collections?

3. _4.9 average response_____ Some Minnesota retirees move to Sunbelt states.  On a scale of (0) most disagreement, to (5) neutral, to (10) most agreement, what is your view on whether significant numbers of Minnesota retirees are moving to Sunbelt states to avoid higher state taxes in Minnesota?

4.  _7.4 average response_____Minnesota ranks low among states in academic research and development.  On a scale of (0) most disagreement, to (5) neutral, to (10) most agreement, what is your view on whether, to improve economic growth, Minnesota needs to significantly expand research and development in its academic institutions?

John Cairns (10) (8) (3) (7)

Donald Anderson (5) (8) (0) (10)

Bill Kuisle (10) (6) (10) (5)

Question 3:  Then they come back here for their final years.

Question 4:  We need to make sure that this is spent on research that will benefit society. Maybe more of the money going to institutions like the "U" should be earmarked to R+D.

Phil Herwig (10) (6) (4) (5)

John Milton (5) (8) (0) (3)

Question 1:  We should be constantly looking at what level of government should pay for and operate essential services.

Question 2:  The way this question is asked, it's a no-brainer . . . We will lose revenue from the baby-boomers, but need to find ways to recoup it from the next generations coming up

Question 3:   The key to this is the word "significant" -- we need better data rather than "war stories" from the golfers in

Question 4: We do not need more self-serving research from places like the U of M . . . We need to get every young Minnesotan an education that will serve them in a rapid changing economy.  The idea of the U of M becoming one of the world's top research centers is laughable . . . I can hear the laughter all the way from Palos Altos, Houston/Dallas, Princeton, New Haven, Cambridge, London . . . Arrogance, which has always been well developed at the U of M, is simply not enough . . . How about the basic mission?

Kent Eklund (9) (9) (5) (9)

Bert Press (10) (10) (10) (5)

Rick Bishop (8) (8) (10) (10)

David Dillon (10) (10) (10 ) (10)

Question 3:  I personally know many people who have or are considering it.  
 
Question 4:  The idea that economists disagree about everything is a myth.  Sure, there is lots of disagreement about predicting the future but on these two points there is universal agreement:  Wealth comes from productivity improvement.  Productivity improvement comes primarily from innovation.  
The University of Minnesota is a key economic asset of the state and needs to be supported in their pursuit of research and development.  One need only look to the impact of MIT or Stanford to see what this can mean to the economic vitality of an area.

Tim Utz

So much to reply to on this forum but not the time. I had a simple (sometimes simple actually is the only option) last year during my run for office. State spending subtract state revenue equals a balanced budget. Our family’s revenue has dropped by 60% in 3 years, and we reduced our expenditures by more than that. Postponing state spending into the future, by shifting, solves nothing but give a false security. The only real solution is returning our state functions to constitutional boundaries, and current elected officials appear pointlessly incapable to do just that. What a sad day in my 32 year residency in Minnesota.

A very sober economic outlook for the state and the state's budget--Looking toward the next biennium (July 1, 2011, to June 30, 2013), Stinson said the current planning estimates show the state's general fund budget more than $4 billion short of being in balance.   That estimate, he said, is after revenue growth of more than 11 percent is factored in.  State general fund revenues in the 2012-13 biennium are expected to total $34.3 billion.  

How can people tell legislators Minnesota can expect a revenue growth of 11% in the next biennium and keep a straight face? Half the state budget problems are the spend happy legislature and the other half are the economic forecasters on the state payroll, The “blind leading the blind”.

Jan Hivcly (4) (10) (_) (7)

Question 1:    I have no idea what "redesign" might include.
Question 3:   Who are we "agreeing" or "disagreeing" with here?  I agree with Tom Stinson that "Tax motivated movers appear to be a very small group of people."  Of course, the small group may be made up of the most wealthy people in the state.
Question 4:   Most of the R&D at the University is supported by federal grants or by foundation or private donor grants.  The question is whether we are developing the climate for R&D ---- high pay for the key researcher, lots of eager grad student assistants, good equipment, support for patents, promotion of products, capital investment for spinoffs, etc.

Alan Miller (2) (5) (5) (10)

Hans Sandbo (8.5) (9) (2) (10)

Bob White (7) (10) (5) (10)

Question 1:  This sort-of-yes answer registers my concern that redesigning local aid alone would mean simply reducing local aid; i.e., it needs to be part of a larger overhaul of state budgeting. 

Question 3:  As Tom pointed out, there's no data beyond anecdotes.

Question 4:  Easy to give a top mark but difficult to carry out because, again as Tom observed, the budget trap in the next several years makes even that kind of important investment unlikely.

Richard McGuire (10) (7) (1) (10)

Question 4:  This is critical not only for Minnesota but for the entire country.

Charles Lutz (9) (9) (1) (9)

Austin Chapman (9) (9) (8) (9)

Question 3:  Don't know the overall percentage but the drain is primarily among high income and high contributing people.

Conrad deFiebre (0) (10) (1) (1)

Question 1:  Governor already has redesigned local aid, forcing cities to raise taxes and cut services at the same time. State hasn’t raised taxes, but still has gained revenue.

Question 3:  As Stinson said, it’s a small niche demographic, led by the likes of Bill Cooper. He had the chutzpah to editorialize that he was moving to Florida to escape MN’s onerous taxes shortly after his company benefitted greatly from a 9-figure state investment in TCF Stadium. Most folks are more thankful to the states where they made their fortune. My dad, for example, is a pragmatic sort who always votes “the side the bread is buttered on.” But he continues to pay Ohio income taxes despite spending at least 7 months a year in Florida.

Question 4:  We are tapped out of the ability to invest “significantly” in this. But we need to keep looking for the smartest research opportunities with the highest probability of payoff.

Vici Oshiro (_) (_) (_) (10)

Question 1: Redesign?  not sure; reexamine?  yes

Question 2:  This is a fact; why ask for my opinion?

Question 3:  Few because of taxes; more because of weather.  Heard long ago that many return when in their 80s because of better health care here.  We never left.

Question 4: 10.  But we also need to have the conversation about role of government suggested by Stinson.  Don't know how that can happen in current political climate.  Is this a role for non-profit sector? 

Don Fraser (5) (8) (2) (9)

David Broden (10) (5) (1) (7)

Question 1:  The review of LGA is definitely at the top of the redesign list. This redesign should not be only to shift the responsibility to the local community but to see alternative resources to keep the quality of Mn cities, towns and all communities uniform and at a high quality etc. A Mn quality has been the uniformity across the state regardless of size or economic strength. This reflects on how we are Mn. Rather than cut out LGA we need to define what the criteria and basic levels of service are--how state vs. local resources can keep quality in place etc. Bottom line is don't eliminate but keep with new approaches and criteria. 

Question 2: If the focus on Mn economy remains flat and not building new high quality jobs the revenue side can only go down as there are more retirees and few workers. On the other hand if we build jobs and the economy with the quality of the Mn workforce the tax income revenue should grow and the retirees will add to the revenue as that segment grows in number. Once again we are driven to finding a way to grow the economy and jobs. Concurrently we need to keep some of the retirees in the workforce in a productive way longer than we currently do. Since the nation is skilled resource short even in down turn economy and we have the skilled resources our business need to look at how to use the retiree age group. To facilitate this we need to look for the right type of near or at retiree manpower training--ie senior skilled education updates--we need more programs like this in our state colleges etc. to keep these people being value added to the economy. 

Question 3:  There are some and I believe the number to be a few who migrate to avoid taxes and yet they get the publicity. We need to be sure to have some type of incentive for these folks to keep their residency in Mn and with some thought  this should not be hard since they come back each year. 

Question 4:  This one we need to be careful about. Mn does do a reasonable but could be better job in spending on R&D. How the funds are allocated and then more importantly how the research is flowed out of the U etc. to industry --particularly industry that will begin, grow, and stay in Mn is the more important issue. The U can be a first class location for R&D but if the process of applying and using the results is not good or for some reason the output goes to another state--we have lost not only the R&D results but the cost of education for those involved and we train people for another state. This can be the reality of globalization  but it should also be a reason to work a better technology transfer and application process to keep both the technology and the people educated within Mn. This must be a joint role of the U, other institutions, the state thru DEED, business, and local communities who enable new business start up. We need to provide some incentives for Investment companies to work the IPO world for Mn --to keep people and technology to build Mn economy. A priority must be to turn the image of low R&D to a high R&D capability. While the U tech transfer process is said to have been improved over the past 2-3 years there are many who say it has not--this is a good topic to push to clarify and get a new look with a different perspective than perhaps has been used. 

Joe Mansky (10) (5) (2) (10)

Question 2:   I’m not sure about this. I suspect that people 65+ will be spending virtually all of their income on an annual basis, which would generate sales tax revenue. I guess I need to learn more about this subject.

Question 3:  I can buy the concept that someone moves to live in a better climate, to be near friends, family, etc. But moving elsewhere to save $50 per week? I find that hard to believe.

Al Quie (10) (10) (0) (10)

Jim Weaver (10) (6) (6) (3)

David Detert (3) (10) (2) (10)

Peter Hennessey (5) (8) (8) (0)

Did I read this right? You have 11% more revenue and still are $4B short? What the .....?  

Question 1:   I have no idea. That's what we have economists for. Hopefully they give us politically unbiased facts and opinions.  

Question 2:  Old folks spend differently. Tend to have more tax-free income. 

Question 3:  Also the weather, lower cost of living.

Question 4:  But only because I am sure you guys mean that the state government should spend money on research. No. The gov't has no business doing that. Colleges and businesses are smart enough to figure out what they need to do with the resources they have. Let business finance R&D. Don't mix in politics. If you want to encourage R&D in general, make changes in the tax code. 

Ray Cox (10) (10) (10) (5)

Question 1:  I believe we need to look at weaning all cities from LGA in a responsible fashion. Looking at what it costs to povide water, sewer, police, fire and libraries seems to be a start. LGA should not be involved in anything beyond those basic items. Determining a fair tax burden for those items is a reasonable way to even out state assistance and direct it only to those that truly need assistance.

Question 2:   I don't see how anyone could argue against this position. The demographics of Minnesota are not complex....our progressive income tax system will end up hurting collections as the baby boomers move into retirement.

Another factor to be aware of is the loss of small businesses. Many baby boomers are closing businesses rather than stay involved and 'fight through' this huge economic downturn. This is not being tracked, but I feel it has the potential to be huge, in both loss of income taxes and loss of jobs.

Question 4:  I would need to see much more research on this issue and know how we are going to compete against other states.

Jim Keller (10) (10) (10) (2)

Question 3:  I have experienced the fact that many of my friends were already leaving the state for 3 months or more; by extending this time they "moved out of the state" without moving. By the way, the states involved are many; also the cause is as much the estate tax as the income tax.

Question 4:  I don't believe that we can make the assumption that economic growth is dependent solely dependent on our local talent population. When we had a large base of large and small companies, we had an influx of qualified workers, today we are exporting our educated people. I believe in the adage "Build it and they will come."

Wayne Jennings (4) (7) (6) (8)

Terry Stone (10) (10) (7) (5)

Question 4:  The bloated bureaucracy of academia is an inefficient and cumbersome environment in which to nurture a research-based economy. A business-friendly tax climate will foster research companies more effectively.

Bill Frenzel (10) (10) (6) (_)

Question 2:   Of course it will. All the  more reason to plug a few holes in the leaky sales tax.

Question 3:  Some move for sun; some move for lower taxes. My guess is that the latter group would include relatively high-income, high-tax individuals. As long as FL, TX,  etc. have no taxes, we are not going to compete.

John Branstad (7) (7) (0) (9)

Great recap (as always). I have a ton of respect for Mr. Stinson and Mr. Gillaspy. They provide facts and their professional conclusions without becoming overly political - unfortunately a rare occurrence these days...

Question 1:   As a resident of a small town in rural southern MN, I'm in favor of some redesign of state aid to cities in order to get back lost state aid over the past few years. Our "no new taxes" Governor has passed the buck to our cities and counties by cutting their aid and forcing increases in property tax levies and cuts to some of the most effective services provided at local levels.

Question 2:  There will certainly be an impact, however I'm not convinced it will be of the crippling / unrecoverable nature.

Question 3:  As Mr. Stinson stated, the evidence is purely anecdotal and appears to be (at most) only a very small number of folks. This myth deserves to be fully debunked. It screams 'confirmation bias'.

Question 4:  Higher Education Funding has been a favorite 'whipping boy' of the current Governor. Unfortunately, those chickens are coming home to roost and our state's economy is paying the price. Businesses are formed from ideas borne out of research and innovation, often done at the University level. When those programs are targeted time and time again by the Governor, what message is that sending to the leaders of the next generation? To me, his message is "Minnesota doesn't value the work you're doing to lead us into the future. Take your ideas elsewhere." 

Glenn Dorfman (10) (10) (10) (10)

Question 1:   If by re-design, you mean making state aid to cities a low state priority. The idea that some state taxpayers subsidize other state property taxpayers, regardless of income, is  ridiculous and has been since it’s imposition in the early 1970s. Property taxes are local taxes and people have to make choices about where they live based upon objective reality. Living out in the country is fine as long as one understands that it will take a longer time in coming than if one were to live in a city/regional center. It is not the job of state taxpayers to subsidize lifestyles.

Question 2:  Many retirees may lose income but many shelter it from taxes through the use of tax free municipal bonds. Maybe this tax expenditure is unnecessary and could be eliminated.

Question 3:   As the baby boom turns 65 beginning in 2011, this trend will accelerate. Further, we should “fix” the problem of retirees moving to low tax states until they become ill or spend all of their resources only to return to Minnesota for government provided nursing/health care.

Question 4:  But isn’t this an institutional decision? Rather than admitting all potential students, regardless of their academic standing, at deep discounted (taxpayer supported) tuition, maybe we should provide full and partial scholarships to the “best and brightest” while steering others to vocational and Community colleges for training for jobs that the economy needs. I suspect this is not a very “Minnesota-nice” answer. However, I would argue that it is exactly the Minnesota nice passive-aggressive that may have brought us to this critical time in our history. If no one is every willing to say “no”, it is not surprising that we provide state aid to local governments while allowing state bonding for local community centers, give taxpayer discounted tuition to Minnesota College and University students but are aghast that we do not have enough money for research and development!

Robert A. Freeman (8) (8) (6) (10)

Question 1:  This is essentially a transfer of money from the suburbs to the inner cities and rural cities.  If we wish to pursue this as a state policy we should make it more explicit and transparent.

Question 3:   Can't help, but I suspect other factors are just as important.

 

    

The Civic Caucus   is a non-partisan, tax-exempt educational organization.   The Core participants include persons of varying political persuasions, reflecting years of leadership in politics and business. Click here  to see a short personal background of each.

   Verne C. Johnson, chair;  David Broden, Charles Clay, Marianne Curry, Bill Frenzel, Paul Gilje,  Jim Hetland,  Marina Lyon, Joe Mansky, John Mooty,  Jim Olson,  and Wayne Popham 


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