Minnesota Legislative Bulletin 2-2-10

With the Minnesota Legislature about to start, there is much speculation on what will be accomplished other than passing a bonding bill. According to lobbyists who spoke at a recent subcontractors meeting, this year's bonding bill contains a little bit of everything from everyone. Once it is passed, the session can adjourn. Legislators have incentive to do just that in record time.

Primaries are being moved to August to allow military service people time to vote. That decision caused both the Democrats and GOP schedule their party's convention scheduled in April. It will be challenging for those who are introducing policy bills to grab Legislators' attention long enough to have them debated and passed.

Below is information about some of the specific issues other industry groups are monitoring or proposing.

Paula Siewert

Building Jobs Coalition

Several labor groups, municipalities, the trades council and AGC have joined together to form the Building Jobs Coalition with the purpose of enacting legislation that will add jobs to Minnesota's economy through construction. Their proposals focus primarily on industrial and commercial projects and include provisions for energy conservation, green building and sustainable design, and tax credits.

Since the major obstacle for construction projections is financing, the key to this legislation is establishing a Loan Guaranty Fund of $100 million. It will be a revolving fund that guarantees up to 25% of what the bank requires for a down payment of a project after initial 20% is paid by the developer. Up to 40% of the loans must be made outside the metro area.

The bill includes a provision for first-time homebuyers to secure a loan against the federal tax credit. The agency that oversees the fund would issue a second mortgage for qualifying home buyers and loan them up to $8,000 of the federal tax credit. The homebuyer would then use the refund to pay the loan and if paid at the time the refund is issued, the homebuyer pays no interest on the loan.

The coalition's challenge will be finding the money to establish the fund. The State will not hold a liability on its books. Given the status on our State's budget, this will be a very difficult sale to make.

Here is the link to a copy of the bill: Building Job Coalition Bill

Subcontractors Coalition

It is rumored that a bill will be introduced to charge sales tax on construction labor. The coalition is organizing its members to oppose the bill based on these points:

1.Sales tax on construction labor will further reduce current construction levels which have been severely hurt by the economic recession.
2.Small business owners cannot pass on additional costs to customers who are already stretched thin by the current economic downturn.
3.Sales tax on construction labor would impact small business owners more greatly than larger contractors because they don't have the staff, time or funds available to comply with new sales tax collection procedures.
4.Companies would incur additional staff and administration costs to process collection, filing, and payment of the sales tax.

Chemicals

Minnesota Retailers Association is watching a bill that was passed last session (MS 116.9401-116) concerning "unregulated" and potentially "toxic" chemicals in consumer products and especially children's products. This legislation requires the Minnesota Pollution Control Agency to compile a list of chemicals and for the Department of Health to designate and publish a list of priority chemicals in children's products by February 1, 2011. The purpose of this legislation is to reduce and phase out the use of priority chemicals in children's products and to promote consumer product design that considers a product's impact over its life cycle.

How does that affect you? Think about the treated wood that has been used for playground equipment. Some of you with hardware stores may have toys or baby products (plastic baby bottles) on your shelves. It may be required that special warnings be put on these products or they may have to be replaced with another type of product.

Minnesota Retail Association will follow the progress of the two state agencies as well as any legislation introduced in the 2010 legislative session. Click on the link listed below to view the January 15, 2010, interim report.

Chemicals of Concern