STAFS Minnesota Proposals
STAFS first goal is to make options for moving Minnesota forward out of the current fiscal crisis widely available to policy makers and the public. The situation we're in raises the question: How can Minnesota get out of this mess?
Through whatever combination of four approaches is politically acceptable: cut, tax, grow and redesign. Cut means cutting spending. Tax means raising taxes. Grow means letting economic growth increase tax revenues faster than spending is increasing. Redesign means changing the way government works, so that Minnesotans get more value from the public spending dollar. Redesign appears to be essential.
Through whatever combination of four approaches is politically acceptable: cut, tax, grow and redesign. Cut means cutting spending. Tax means raising taxes. Grow means letting economic growth increase tax revenues faster than spending is increasing. Redesign means changing the way government works, so that Minnesotans get more value from the public spending dollar. Redesign appears to be essential.
Redesign of how its governments operate and provide public services appears necessary if Minnesota is to have a bright future. Understanding Minnesota’s Big Picture is essential to understanding whether options for change are sensible or not.
Unfortunately, as of the middle of the 2011 legislative session, the now 10 year old stalemate between Minnesota’s Governor and the Minnesota Legislature continues. The cast of characters and the party in charge of each branch changed, but the result remains gridlock. Now, though, legislators have the upper hand, as the Governor cannot force them to spend and tax more than they are willing to do. This is a major switch from the last eight years, in which the Governor could stop spending and taxing that he considered excessive.
Each side’s proposals to date in 2011 are deeply flawed. Enactment of either side’s public proposals would unnecessarily adversely affect Minnesotans’ interests. A middle way that advances Minnesotans’ interests is possible. See “March 2011 Letter on Budget Compromise to Governor and Legislative Leaders” for five flaws in each side’s publicly announced positions and six categories of change for the long term that they could consider in crafting the budget compromise that five million Minnesotans need. Specifics on the changes needed for the long term follow.
Crucially important to fiscally efficient redesign of Minnesota government is major change in Minnesota’s property tax and local aids system, which exhibits four problems so serious that Minnesotans should demand property tax and local aids system change (see the Minnesotans Should Demand Tax and Local Aids System Change section in Minnesota's Big Picture Details).
Specific Minnesota Proposals for moving Minnesota forward being made available are those developed by STAFS founder, John P. James. STAFS intends to make solutions proposed by others available as well, and to take people’s comments on proposed solutions into account in posting revisions to this website. Contact Us with your proposed solutions, or comments on solutions posted here.
The How to Solve Minnesota’s Budget Problem Framework lays out an 11 element framework for solving the problem. Additional details on most of the elements are contained in Solving Minnesota’s Budget Problem: The How and the Why.
Innovations for Consideration by the House Redesign Caucus presents 25 ideas for the governor's and legislature's consideration in response to their Request for Innovations.
The most important tax system change to make is to vastly expand the consumer sales tax base and slash the sales tax rate from its current 6.875% to something in the 3-5% range. It is #1 in Framework and Solving. STAFS unsuccessful attempt to persuade the 2010 gubernatorial candidates to own up to this need is detailed in Sales Tax Base Broadening Candidate Letter.
A new approach to business taxation is set forth in Minnesota Needs to Hit the Reset Button on Business Taxation. The inadvisability of repealing the corporate income tax is mentioned there and hammered home in The Repeal the Corporate Income Tax to Create Minnesota Jobs Bamboozle. The research demonstrating the bamboozle was done after the drafting of the Framework and Solving, so Solving is a bit kinder to the possibility of replacement of the corporate income tax with the business activities tax than is warranted in light of the research described in detail in Bamboozle.
The foregoing proposals focus on solving the budget problem and the sales tax base broadening and business taxation challenges. They are more precise in those areas, but build from and are consistent with the earlier Change Minnesota proposal, the core of which was major property tax and local aids system reform.
The Change Minnesota proposal (Summary & Detailed) was submitted to the governor and legislative leaders in December 2008 and then in revised form in March 2009 as a result of further design work. If the legislature took advantage of all these change options, and supplemented them with reforms mentioned but not detailed in the proposal, it could substantially redesign Minnesota’s state-local government relationship, improve Minnesota’s competitiveness as a business location, and create incentives for better treatment of the environment, as Minnesota voters made clear they want in passing the Legacy Amendment to increase the sales tax for that purpose. Presented here is the March 2009 version. Truncated versions of this that were submitted to legislators and the governor in 2010 are omitted. Click the links below for details.
Unfortunately, as of the middle of the 2011 legislative session, the now 10 year old stalemate between Minnesota’s Governor and the Minnesota Legislature continues. The cast of characters and the party in charge of each branch changed, but the result remains gridlock. Now, though, legislators have the upper hand, as the Governor cannot force them to spend and tax more than they are willing to do. This is a major switch from the last eight years, in which the Governor could stop spending and taxing that he considered excessive.
Each side’s proposals to date in 2011 are deeply flawed. Enactment of either side’s public proposals would unnecessarily adversely affect Minnesotans’ interests. A middle way that advances Minnesotans’ interests is possible. See “March 2011 Letter on Budget Compromise to Governor and Legislative Leaders” for five flaws in each side’s publicly announced positions and six categories of change for the long term that they could consider in crafting the budget compromise that five million Minnesotans need. Specifics on the changes needed for the long term follow.
Crucially important to fiscally efficient redesign of Minnesota government is major change in Minnesota’s property tax and local aids system, which exhibits four problems so serious that Minnesotans should demand property tax and local aids system change (see the Minnesotans Should Demand Tax and Local Aids System Change section in Minnesota's Big Picture Details).
Specific Minnesota Proposals for moving Minnesota forward being made available are those developed by STAFS founder, John P. James. STAFS intends to make solutions proposed by others available as well, and to take people’s comments on proposed solutions into account in posting revisions to this website. Contact Us with your proposed solutions, or comments on solutions posted here.
The How to Solve Minnesota’s Budget Problem Framework lays out an 11 element framework for solving the problem. Additional details on most of the elements are contained in Solving Minnesota’s Budget Problem: The How and the Why.
Innovations for Consideration by the House Redesign Caucus presents 25 ideas for the governor's and legislature's consideration in response to their Request for Innovations.
The most important tax system change to make is to vastly expand the consumer sales tax base and slash the sales tax rate from its current 6.875% to something in the 3-5% range. It is #1 in Framework and Solving. STAFS unsuccessful attempt to persuade the 2010 gubernatorial candidates to own up to this need is detailed in Sales Tax Base Broadening Candidate Letter.
A new approach to business taxation is set forth in Minnesota Needs to Hit the Reset Button on Business Taxation. The inadvisability of repealing the corporate income tax is mentioned there and hammered home in The Repeal the Corporate Income Tax to Create Minnesota Jobs Bamboozle. The research demonstrating the bamboozle was done after the drafting of the Framework and Solving, so Solving is a bit kinder to the possibility of replacement of the corporate income tax with the business activities tax than is warranted in light of the research described in detail in Bamboozle.
The foregoing proposals focus on solving the budget problem and the sales tax base broadening and business taxation challenges. They are more precise in those areas, but build from and are consistent with the earlier Change Minnesota proposal, the core of which was major property tax and local aids system reform.
The Change Minnesota proposal (Summary & Detailed) was submitted to the governor and legislative leaders in December 2008 and then in revised form in March 2009 as a result of further design work. If the legislature took advantage of all these change options, and supplemented them with reforms mentioned but not detailed in the proposal, it could substantially redesign Minnesota’s state-local government relationship, improve Minnesota’s competitiveness as a business location, and create incentives for better treatment of the environment, as Minnesota voters made clear they want in passing the Legacy Amendment to increase the sales tax for that purpose. Presented here is the March 2009 version. Truncated versions of this that were submitted to legislators and the governor in 2010 are omitted. Click the links below for details.
