Two candidates, two positions, one commonality

The people of House District 15B awoke this morning to a news article about the two remaining DFL candidates who have entered the race to be their representative.  They have a choice between a candidate that wants to tax our purchases of clothing, and one that wants to tax small business owners who choose to take their business income on their individual income tax form:

Dorholt and Lewis both adhere to the DFL position that the state must raise taxes to resolve its deficit. Lewis says she’d consider eliminating state sales tax exemptions for clothing and other exemptions. Dorholt says an income tax hike on high earners would be the least onerous option for a tax increase.

Some choice.  The common feature is that both candidates from the DFL support a higher level of state spending and the intrusion of the state deeper into our lives.  One wants to tax the very same producers whose entrepreneurship is vital to our economic recovery.  The other wants to tell poor families that their children's blue jeans should cost an extra 7.375% at Crossroads Mall.

Regardless of the choice local DFL voters make in August, voters will have a clear choice in November.  I will vote against either of these tax increases should they come before me in 2011 as your representative from District 15B.  We can balance the next biennium's budget without a tax increase.  It only takes the will and a belief that government can perform its vital functions with the amount of money we are projected to have. 

In its last forecast, the Department of Finance projected revenues in the next biennium to rise to $32.9 billion from this biennium's $31.1 billion.  That's a 2.85% annual rate of growth.  Don't you think they have enough?  My opponents say no.

Press release on announcement of retirement of Rep. Haws

King Banaian, endorsed candidate for the Minnesota House of Representatives from District 15B, gave the following statement after the retirement of Representative Larry Haws.

"I thank Representative Haws for his five years of service in the Legislature to the people of St. Cloud," Banaian said.  "Rep. Haws will be remembered as a hard worker and leader in this community."

"We have much work to do now, to continue to talk to the people of St. Cloud about how we can hold state government accountable to its promises and to make it live within its means.  I look forward to hearing many good ideas from residents of our district, and to taking those ideas to St. Paul in January."

Banaian lives in St. Cloud with his wife, Barbara, and their daughter. House District 15B includes the northern and eastern portions of St. Cloud, and Haven Township.

Statement on DFL budget balancing bill

King Banaian, endorsed candidate for Minnesota House District 15B, issued this statement the day after the Minnesota Legislature passed H.F. 2037, a bill that includes tax increases to balance the 2010.

"Last night my opponent voted to increase taxes on small businesses and what he considers wealthy Minnesotans," Banaian said.  "The last Economic Update from the Finance Department cited consumer confidence and sentiment being 'mired' at low levels and 'lingering employment concerns, slow wage growth, and tight credit are likely to inhibit household spending until 2011.'  Even if you believe Minnesotans don't pay enough, this is a terrible time to raise taxes."

"But we do pay enough.  The DFL bill that Rep. Haws voted for would give Minnesota the 4th highest marginal tax rate in the country on incomes of $200,000.  Higher rates in California have done nothing to cure their budget problems.  Why does Larry Haws think this is a good example to emulate?"

"The answer to every DFL problem is to look at small businesses as an ATM from which they can cover their need for more money.  They have enough; the real need in Minnesota is to reduce spending, not raise taxes.  Rep. Haws had the opportunity to balance the budget by ratifying Governor Pawlenty's spending reductions but voted against that.  When I get to St. Paul, we will set priorities that do not ask already-generous Minnesotans for more," Banaian concluded.

King Banaian is an economist who is running to represent north and east St. Cloud and Haven Township in the Minnesota House of Representatives

A response to a Larry Haws update

Rep. Haws on April 22 put out a legislative update to his work in our House.  Let's see what he has to say:

The legislative session is set to end on May 17. Our goal is to resolve our complicated budget issues by then.

How did it get so complicated, I wonder? According to the April Economic Update from MMB, revenues for FY 2010 (ending June 30) came in $40 million below what was expected. In a $10,000 million budget (for the period from 7/1/09 to 3/31/10) that is not so much money.  Most of the increase came from increases in costs associated with the recession.  While these need to be fixed, the need for entitlement reform has been known to the Legislature and Rep. Haws for quite some time.

Let's read on:

With the passage of the new federal health care bill we are currently awaiting information from the feds on what states can expect from new MA reimbursement funds. The numbers are quite large and, depending on the amount, will determine whether we horribly slash state health care services to the most vulnerable citizens or make smaller cuts impacting less people. Given that lots of disabled, dependent-care Minnesotans will be affected by our budget decisions, I believe it is wise for us to wait for further information from the federal government before we proceed to finalize our budget. Otherwise our only choice would be to deeply slash services to these vulnerable citizens.

For those of you unfamiliar with the ways of St. Paul, this is an activity known as "kicking the can down the road." Because they don't want to cut anyone (health and human services is scheduled to spend more than $4,200 million in fiscal year 2010) they are hoping that the U.S. government sends them some money to foot the bill. The 2009 federal stimulus bill only pays through December 2010.  A bill in Congress to extend the funding an additional six months is in trouble because Congress does not know how to pay for it.

And under current proposal made today in the Legislature, expansion of health care coverage could end up costing the state millions of dollars more.  It doesn't have those dollars...yet.  You do.  We have a fix in place for these individuals in the GAMC bill that passed.  DFLers want to raid other money to pay for switching them to Medicaid early.  It's expensive, and I oppose it.

Please, Representative Haws: Balance the budget and come home.  It's time to debate.

Laws Will Put Minnesotans Back to Work
We are on the homeward stretch with only a month remaining before we adjourn the 2010 Legislative Session. This session has been fast-paced and focused on pursuing job-creating legislation to jumpstart the state’s economic recovery and balance the budget.

Our job creation strategy paid off with the early passage of the Omnibus Capital Investment Bill and the Minnesota Jobs Stimulus Bill. These timely pieces of legislation have been signed into law – just in time to make the most of the upcoming construction season.

These laws will help promote job growth and economic development across the state by ensuring small businesses are more competitive and by creating employment opportunities in bioscience, manufacturing, high-tech industries, construction and infrastructure development.

Here's a graph of monthly, seasonally-adjusted data for construction since 2008.

Data in thousands. See any help from bonding there?

Even if I focus only on the employment in heavy and civil engineering construction -- the direct entry of most of those bonding dollars -- the gain in March 2010 versus March 2009 is 251 jobs.

Truth is, the DFL thinks a dollar taken from you and given to a construction worker creates a job.  What if your dollar was meant to hire someone else?  Or to buy something from a store owner who would have hired a helper with that dollar?

The value of bonding is not in job creation but in asset creation.  We bond to create public assets that generate more value than what we spend on them.  When the building is done, what will Minnesota have gotten for its money?

Looking for Minnesotan’s Ideas on Reform
Our unprecedented structural budget deficit is proving to be a catalyst for redesign and reform initiatives at the State Legislature. My colleagues and I are moving forward on many fronts with reforms that will benefit Minnesota taxpayers and help rebuild our state’s prosperity.

I assure you that as we go about restoring fiscal stability in our state budget, our state government can no longer afford to keep going about business as usual. Pursuing the status quo will only become increasingly unaffordable as we continue to absorb the impacts of the Great Recession, aging demographics, and high property tax burdens.

So, it is in our best interest to redesign and reform state government operations in a way that will deliver greater efficiency in government services at a lower cost.

Almost at the onset of the 2010 Legislative Session, a Redesign Caucus was formed and proceeded to launch a “Redesign Comment Line” asking citizens to share their ideas on how areas of state or local government can be reformed to increase results at a lower cost.

Minnesotans are encouraged to submit their ideas at www.house.mn/redesign or call the Redesign Hotline at 651-297-8391 or 1-800-551-5520. The best ideas will be put into a “Citizen Redesign Bill” in the 2011 Legislative Session.

A legislator who has been there more than two terms wants other ideas? Where are his?

I have a model for zero-based budgeting, a bill that has just passed the Georgia Legislature. It phases in zero-based budgeting over a set of years and a requirement of each department to offer alternative funding levels and outcomes of those levels. Georgia has an annual budget while Minnesota's is biennial, so we would modify this to do half of state government in the 2012-13 biennium and the other half in 2014-15, then repeat the process each four years. Every governor therefore would have an opportunity to review his or her departments and build them from scratch. This will be the first bill I will author when I go to St. Paul next January.

Tax Freedom Day

King Banaian, Republican-endorsed candidate for Minnesota House from District 15B, expressed today his congratulations to the state of Minnesota on its marking of Tax Freedom Day.  Tax Freedom Day is marked by the Tax Foundation as the day when a resident of a state has earned enough money to pay her or his federal, state and local taxes.

"Congratulations, Minnesotans!" Banaian said.  "It took 102 days to reach this date.  Alas, 41 states previously have marked Tax Freedom Day, while workers in seven other states are still laboring to pay their taxes."

"Last year the DFL tried to pass a $1.5 billion tax increase that would have made this day even later," Banaian continued.  "This is one case where we should try not to be decidedly above average."

House District 15B includes the northern and eastern portions of St. Cloud and Haven Township.

For more information about Tax Freedom Day, see http://www.taxfoundation.org/taxfreedomday/