To the Editor:
The Minnesota House of Representatives' Jobs and Economic Development Finance Committee has unanimously approved Performance Rewards on Fast Investment legislation, otherwise known as PROFIT, of which I am the chief author.
I am carrying the bill in order to promote job growth throughout Minnesota.
One of the best ways we can spur economic development is to pass this PROFIT legislation. Everyone agrees that jobs should be our top legislative priority, so I'm hopeful this bill will soon receive a vote on the House floor.
PROFIT utilizes some provisions that worked in Minnesota's Job Opportunity Building Zones (JOBZ) legislation, and combines them with new ideas to create more jobs throughout the state.
The PROFIT program would provide tax abatement to companies looking to expand and put more Minnesotans to work. Manufacturing, warehousing, information technology, distribution, finance, insurance or professional or technical services businesses would qualify for the program.
In exchange for receiving a refund of property, sales and motor vehicle taxes paid in order to operate as a PROFIT business, the company must create at least 10 new full-time jobs, paying at least $35,000 in annual wages for businesses located in the metro area, or at least $27,000 in rural Minnesota. The business also must invest at least $500,000 in a construction project that includes a new, expanded or remodeled facility within two years of signing the agreement.
The binding agreement would take place between the company and the local government, which would determine how long the business would receive PROFIT benefits, up to a maximum of 12 years.
One notable provision of the bill centers on the company reaching its goals. For example, if the PROFIT business created 30 percent fewer jobs than it promised, its tax benefits would be reduced by 30 percent.
This bill doesn't pick winners and losers. It does not create job zones as both rural Minnesota and the metro area are in need of job growth. This bill serves as a catalyst for business owners to expand when another company has decided to leave, and gives local governments the opportunity to serve as the dealmaker.
Our workers are in need of new job opportunities, and I'm confident this legislation will provide good-paying jobs to those who need them.
The PROFIT legislation will now be sent to the Minnesota House Taxes Committee for its approval.
State Rep. Bob Gunther,