Is Our Economy Being Sacrificed?


Is our economy being sacrificed to someone else?

An article came out the other day in the “Politics In Minnesota” publication which promised to be quite good. Unfortunately, I do not have a subscription to this publication, so I could only read the first paragraph. Rather than pay the fee, I decided to research the story for myself. For those who have a subscription, or who would like one, here is the link to their article.

In researching my article, I used as a source the newly released “Iron Range Fiscal Disparities Study.” The charts which you will find below are all from this study.

Our first chart should give everyone pause when our future is considered.

MnDoRfiscal disparities1

Looking at this chart, you will see that the three lines representing the private sector were all going up until the TARP/housing bubble crisis. After that, they have all declined at varying rates. Now look at the public utility line. Starting in 2010 this line started going up at nearly a 45 degree angle.

What does this mean? Our economy has not recovered as evidenced by the decline of all areas of the private sector listed, but the public sector, measured in percentage of Net Tax Capacity, has grown dramatically. Our government expenses have gone up at the same time that our private sector is making less money to pay for it.

The second chart shows the growth in fiscal disparities from 2001 to 2014.

MnDoRfiscaldisparities2

Of note in this chart is that negative numbers indicate amounts given in fiscal disparities and positive numbers indicate amounts received.

In 2001, Itasca County surrendered $22,296, while St. Louis County received $229,585.

In 2014, Itasca County was charged $1,638,449. (a 7349% increase!) while St. Louis County received $2,275,062.

You may ask, ” Who decides what these amounts are going to be?” or, “Who is responsible for supervising this system?” The answer: “St. Louis county administers the Iron Range Fiscal Disparities program.” This quote directly from page 7 of the report. The largest recipient of the proceeds also gets to administer the program. Convenient, isn’t it?

On to our last chart.

MnDorfiscaldisparities3

On the left are the top ten contributors of 2001, the right 2014. The largest contributor in 2001 put in $66,262. The largest contributor of 2014 will put in well over ten times the 2001 amount, or $909,283. Seven on the top ten contributors for 2014 are from Itasca County. Do you live in one of these areas? Are you aware that the fiscal disparities portion of your taxes do not benefit you, but are sent to someone else instead, most likely in St. Louis County?

Why is Itasca County forced to help support St. Louis County when even the Minnesota Chamber of Commerce is supporting a reduction in business taxes based on their findings that taxes hurt the economy?

Is our economy being sacrificed for the economy of another county?

Mike Vroman.

4 thoughts on “Is Our Economy Being Sacrificed?

  1. Pingback: Are Fiscal Disparities Permanent? | Grand Rapids Voice

  2. jack kellin

    are comm. on iedc board paid? where can i find full disclosure of the funds coming in and going out of iedc? son ben imformed me of your work-thanks,jack kellin

    Like

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