A Note from Nort. . .
**Update: KSTP reports that "Unemployment Trust Fund bill needs urgent action to avoid tax increases". To read more, click here.
Contact your elected officials today to tell them this matters to you and your business!
Senator John R. Jasinski (24, R)
Rep. Brian Daniels (R) District: 24B
A note from Nort:
The Chamber has been busy prepping for another year of forward progress in Faribault to help organize efforts with partners on our visionary agenda. I can’t say enough about the great work at Faribault Public Schools and South Central College on establishing new and meaningful pathways for students. We’re also proud of our City Council and City staff in their efforts to keep Faribault moving steadily ahead in a number of ways! Other work for us includes setting our priorities for advocacy work. We’re already closing out the first month of 2022 and Minnesota is opening up a new legislative session. Some of the most important debates will be how to manage a 7.7 billion dollar surplus of funds in the best way for Minnesotans. One important opportunity will be discussed vigorously and that is taking advantage of this opportunity to fix the unemployment insurance fund deficit.
When businesses were shut down early in the pandemic, hundreds of thousands of workers accessed unemployment insurance. By May of 2020, unemployment hit a record high 11.3%, and the state’s unemployment insurance system processed nearly 800,000 applications. This emptied the Unemployment Insurance (UI) Trust Fund that now has a deficit of over $1 billion. At the same time, relief funds flooded into the state. The federal Coronavirus Aid, Relief and Economic Security (CARES) Act provided $2 billion and the federal American Rescue Plan Act (ARPA) provided $2.83 billion, to help with pandemic related expenses. Most other states – 31 of them, to be exact – used relief funds to replenish unemployment. But Minnesota didn’t use a dime for this purpose. 31 states did. The reason this issue is so important to us is this - if Minnesota legislators do not act to replenish the fund a double digit increase in taxes will be placed on Minnesota businesses. To be clear, in our state business is already at a competitive disadvantage against 45 other states. That’s right, the Tax Foundation cites corporate and individual tax rates as part of their ranking system and Minnesota is number 46 in the rankings.
At a time when inflation, fuel prices, staffing shortages and supply chain issues have already taken a toll on most every business we simply can’t allow our state to spend away this surplus and force our businesses to pay the fund back with another tax. We were promised that the “bonus” dollars given to those accessing unemployment during the pandemic wouldn’t cause an additional burden on businesses and state government needs to make sure that doesn’t happen. Lastly, as a reminder on this topic many businesses will have to pass much of the additional expense on to consumers to keep enough margin in play for their bottom lines.
Our amazing business mix here in Faribault keeps our economy going. As these innovative companies continue to grow and thrive we want to make sure that we do all we can to keep the climate for operations as friendly as possible and your Chamber will work hard to make sure they continue to call Faribault home.