3/21/2013 by Ron Brochu

PHOTO: Gov. Mark Dayton, left, and Revenue Commissioner Myron Frans received public input for 90 minutes at the Duluth Public Safety Building Wednesday.

Gov. Mark Dayton’s revised budget proposal received mixed reviews Wednesday from a packed room of stakeholders in Duluth.

As expected, the DFL governor’s plan, which includes spending increases, was praised by those who receive public funds. Despite changes that delete previously proposed business-to-business sales taxes, it received a cool reception from the business community.

Dayton held his ground on some points, including his plan to raises taxes on top income earners, but agreed with business owners who argued regulation should be reviewed and streamlined when possible.

Most of the public forum, the governor’s first since revising his budget plan, was structured as a listening session in which participants were not required to provide their full name.

“There are so many regulations that it’s almost impossible to start a new business,” said a man who identified himself as Paul from Duluth. For example, to get a commercial drivers license, he said an applicant is required to have a hard-wired telephone. “If you ever had a real job, you’d know what it’s like,” he told Dayton.

When questioned about his desire to increase the minimum wage, Dayton argued society will face higher costs either way. If workers are paid too little, he said, they’ll need taxpayer-funded services such as food stamps and Medicaid.

“We should provide incentives so people can work their way out of poverty,” Dayton said.

Cathy Latourneau of D&C Enterprises, a Duluth convenience store company, criticized proposed hikes in the cigarette sin tax. Similar legislation in other states led to reduced tax collections and created a black market for cigarettes obtained in lower-tax states, she said.

Dayton agreed such taxes are regressive but suggested they help reduce smoking, particularly by young persons. Minnesota will aggressively fight black marketers, he said.

When a local manufacturer said surrounding states have lower business taxes, the governor noted residents in those states tend to earn less and their schools have higher student-teacher ratios.

“I don’t want to put anyone out of business or push anyone out of the state,” Dayton said, but “we need a balanced approach.”

Minnesota’s spending level was criticized by a College of St. Scholastica student who described herself as a GOP activist. Such comments are common, said Dayton, but fiscal conservatives haven’t yet explained where to slice $627 million from spending to balance the next biennial budget without raising taxes.

“There’s no easy street,” he said.

Reiterating his position on a project that would require significant state aid, Dayton declined to endorse the Northern Lights Express proposal for high-speed rail between Duluth and Minneapolis.

“The cost of that project is prohibitively expensive,” he said, casting doubt on whether it will receive federal funds any time soon. “The big federal grant era has passed us by,” he added, and “Realistically, the state doesn’t have that kind of wherewithal.”

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