Small Business Voice E-newsletter

December 2006

Small business is big business with the Minnesota Chamber of Commerce! In fact, more than 83 percent of our members have fewer than 100 employees. We are your voice and your advocate in St. Paul, allowing you to focus on what you do best - run your business!

HEALTH CARE
Better avenues than MinnesotaCare
Health care costs top the list of concerns for small employers, but be wary of any quick fixes. Many proposals are certain to be floated in the Legislature – everything from allowing small businesses to buy into MinnesotaCare to a constitutional guarantee of affordable care for all Minnesotans.

If employers want options and affordable health care benefits to offer employees, MinnesotaCare is not the answer. This program is administered by the Minnesota Department of Health for individuals who meet income limits and satisfy other requirements related to residency and lack of access to health insurance.

The Minnesota Chamber has concerns on a couple of fronts. No. 1, permitting enrollment in MinnesotaCare will erode the private market. According to one health plan, 40 percent of its new business comes from groups that have not offered coverage for the last year. Giving those employers the ability to purchase MinnesotaCare would have a significant impact on the private market.

In addition, MinnesotaCare benefits are not as generous compared with private health plans. For example, the state program has a $10,000 cap on hospital care and thus is poor insurance against serious illness or accident which requires hospitalization. If the cap is lifted, the plan becomes unaffordable.

Constitutional Amendment doesn’t address problem
Proposals for constitutional guarantees of health care for all Minnesotans were introduced this year and are expected again. The concerns should be clear to all. Who defines “affordable,” and who will pay for the care?

Policy-makers should focus their attention on affordable options in the private marketplace versus putting more individuals on state-sponsored programs. None of these proposals addresses the underlying cost-drivers of health care.

For more information on the Minnesota Chamber’s health care initiatives, contact Erin Sexton, director of health care policy, at (651) 292-4670 or esexton@mnchamber.com.

STATE BUDGET
Surplus presents opportunities…
The November state budget forecast presents opportunities and challenges for businesses. The bottom line is that the state has a projected surplus of more than $2 billion during the next 2 ½ years. The surplus is divided roughly in half between one-time and permanent money.

The Minnesota Chamber will be advocating tax policy changes with the one-time money that is of interest to small businesses. For example:

Capital equipment refund program: Have you recently purchased capital equipment which is essential to your manufacturing process? Current law allows you to receive a sales-tax refund on the equipment, but the paper work is cumbersome at best and you will likely have to wait 6 months or more to receive your money back. And many businesses aren't even aware of the program. We will be lobbying to make the refund an up-front tax exemption. Contact Tom Hesse - thesse@mnchamber.com - at the Minnesota Chamber if you aren't certain whether you are eligible for the refund or need assistance applying. A copy of the sales tax refund form can be found at http://www.taxes.state.mn.us/taxes/sales/forms/st11.pdf. A volunteer making a Grow Minnesota! visit in west-central Minnesota advised a company of the program. As a result, the company completed the application and received a nearly $25,000 tax refund.

…and challenges, too
The Chamber also will be playing defense on tax issues. A $2 billion surplus should be plenty of money if lawmakers spend wisely and distribute it among statewide priorities. But don't underestimate the spending appetite of legislators. Early indications are that some legislators will push for an increase in the statewide property tax - which will be paid by commercial/industrial properties and utilities. Remind your legislators that the state is anticipated to collect a record $31 billion in tax revenue for FY 2008-09. Please tell them that no increases are necessary in general-fund taxes.

GROW MINNESOTA!
Grow Minnesota! solves your business problems
Grow Minnesota!, finished another successful year. Volunteers from the Minnesota Chamber and local chamber partners visited with nearly 800 CEOs across the state. The information supplements the Minnesota Chamber’s public policy agenda.

Small businesses continue to shine as the backbone of the state’s entrepreneurial landscape. Sixty-six percent of the companies visited had fewer than 50 employees. Ownership is stable and home grown; only 17 percent saw a top management or ownership change during the last year, and half of the companies visited were family owned.

At its heart, Grow Minnesota! helps businesses solve their everyday problems. One in seven visits results in requests for assistance where volunteers either solve the problem or put the company in touch with the appropriate local or state government officials.

Does your company need help on a specific state issue? Would you like to participate in a Grow Minnesota! interview? Contact M.E. Head at mhead@mnchamber.com.

SMALL BUSINESS POLICY COMMITTEE
We have a longstanding Small Business Policy Committee which has a twofold purpose: Forward recommendations to the various policy committees and review all policy recommendations for their impact on small companies. In that regard, we debut this quarterly newsletter which will address concerns from the perspective of small businesses. The Small Business Policy Committee meets the third Monday of each month, except for January when they will meet on the fourth Monday. This year's initiatives parallel the Minnesota Chamber's overall priorities - health care, energy, education and workforce in addition to elections/ethics.

If you would like to learn more about the Small Business Policy Committee or have any suggested issues we should address, please contact Stacia Smith at ssmith@mnchamber.com.

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