District 15A Representative Sondra Erickson introduced legislation last week establishing an economic relief package for the Mille Lacs region. The legislation would transfer revenue generated by sales tax on lottery tickets to the general fund to fund an economic relief package for the region.
“Communities and businesses in the Mille Lacs Lake region have been negatively impacted by the DNR’s continued mismanagement of the lake, partly because they have based their decisions on a treaty rather than on sound biology, which eventually harmed the economy of the region,” Erickson said. “Moreover, the DNR has neglected to provide accountability and transparency for their actions. This proposal and others begin the process to rebuild our local economy and return accountability and transparency to the process of management.”
House File 2592 would have the effect of a general fund expenditure of $12,000,000 annually to fund an economic relief package for Mille Lacs. The package consists of a loan and grant program as a well as abatements. Since the bill transfers a portion of funds that would normally go towards the Natural Resources and Game and Fish funds, this bill does not impact the general fund.
Below is a more detailed section by section summary of the bill.
Summary of the bill
Section 1: Mille Lacs area economic relief program:
This section creates the grant and loan program. The program will be administered by Mille Lacs County with the Department of Employment and Economic Development as pass-through. Funds can be used for broadband, grants, interest-free loans and tourism promotion.
To qualify for assistance, a business must:
• Be located within Aitkin, Crow Wing or Mille Lacs County. This can be narrowed to the 14 townships or to a radius or to just Mille Lacs County.
• Document a decline of 5 percent in gross receipts in 2015 compared to 2014.
• Be in a specific type of industry.
Section 2 – In-lief sales tax diversion; transfer:
This section transfers $12 million of the lottery sales tax revenue (not dedicated to the general fund) to the general fund as a one-time transfer per year for three years (fiscal year 2017, 2018 and 2019).
Section 3 – Appropriation for Mille Lacs Lake area economic relief:
Appropriates money for the next three years from the general fund for a grant to Mille Lacs County to develop and operate the Mille Lacs Lake area economic relief program (outlined in Section 1). The amount is $5.2 million the first year and $6 million the next two.
Section 4 – Property tax abatements; abatement aid:
Provides state reimbursement for abatements in the three county area (Aitkin, Crow Wing and Mille Lacs counties.)
• Applies to seasonal resorts and C/I property.
• Requires taxpayers to be businesses affected by the early walleye season closing to qualify for abatement reimbursements and document 5 percent decline in gross receipts.
• Caps loans and grants to businesses at $100,000/year.
• Provides for $6 million annual appropriation for three years for abatements.
• Provides for an annual audit by revenue.
Section 5 – Malone Island Bridge, Isle:
In fiscal year 2017, $800,000 is appropriated from the general fund to the commissioner of transportation for a grant to the city of Isle for demolition and construction necessary to replace the Malone Island Bridge, including the replacement of accompanying water and sewer lines.
