Minnesota Rural Equity Project identifies priorities for
revitalizing local economies and reducing disparities in Greater Minnesota
Project partnership includes: Coalition of Greater Minnesota Cities,
the Greater Minnesota Partnership, and the Minnesota Asset Building Coalition
CONTACTS: Jane Leonard Dane Smith
President Senior Fellow
651-917-6037 - office 651-917-6037 - office
651-303-5263 - mobile 651- 675-6360 - mobile
Growth & Justice and its partners in the Minnesota Rural Equity Project have announced support for a dozen promising policy priorities in the 2018 legislative session, each of which can help revitalize local rural economies and reduce social and racial disparities in Greater Minnesota. Many of the initiatives also benefit the Twin Cities metropolitan area and Minnesota as a whole, and these priorities therefore serve as a “One Minnesota” policy framework.
These wide-ranging initiatives provide new investments and incentives including: child care and early childhood development, more affordable workforce housing, broadband access, specialized Career Pathways training, Local Government Aid restoration, tax policy that benefits working families, and statewide acceleration of our shift to renewable energy.
“Our policy priorities are evidence-based and draw upon input from communities and stakeholders across the state,’’ said Jane Leonard, President of Growth & Justice, a non-partisan policy research and advocacy organization committed to a more inclusive prosperity for Minnesota. “We believe these ideas and initiatives can bring together Republicans and Democrats from all corners of Minnesota – rural and metro alike.’’ A summary statement about the project’s legislative priorities, along with itemized explanatory details and links, is provided below.
The Minnesota Rural Equity Project seeks answers to this large question: What kinds of state policies, public and private investments, business incentives, and local initiatives will work best to strengthen Greater Minnesota communities, bridge the rural-metro divide, revitalize local economies, and reduce inequality, poverty and racial disparity?
The Minnesota Legislature and state government can’t provide all the answers. Individuals, businesses, philanthropy, non-profits and hundreds of local community organizations and governments must take initiative and be part of this equity effort. But the Legislature and the governor can be a leading partner, and many proposals currently in front of the 2018 Legislature could have a significant beneficial impact on rural vitality and erasing racial and economic disparities.
Growth & Justice and our project partners are recommending a dozen promising and constructive initiatives as priorities. Our list is by no means exclusive or comprehensive. But these priorities have at least some bipartisan support, momentum and viability, and evidence of effectiveness. Many also are longstanding priorities of the individual statewide organizations that are partners in the project: Growth & Justice, the Minnesota Asset Building Coalition, the Coalition of Greater Minnesota Cities, and the Greater Minnesota Partnership. These priorities represent only a starting point and our partnership will build on this foundation going forward. We’ve organized these initial priorities into two categories, Human Capital and Infrastructure.
An Asset Building Agenda (Fines & Fees, Auto Insurance, Entrepreneurship and Tax Assistance): Low-income Minnesotans in rural areas face myriad challenges and unfair costs that prevent accumulation of assets leading to self-sufficiency. The Minnesota Asset Building Coalition’s 2018 agenda includes four practical policy goals that address these challenges: dismantling the “debt trap’’ created by fines and fees for traffic tickets and other minor legal violations; reducing the high cost of auto insurance for low-income drivers; providing more access to capital for budding low-income entrepreneurs and micro-business owners; and increasing support for VITA (Volunteer Income Tax Assistance) sites that provide free tax preparation and financial capability services that support good money management choices at tax time. (Links: Minnesota Asset Building Coalition agenda, Department of Employment and Economic Development’s Minnesota Emerging Entrepreneur Program)
Attracting and Investing in Newcomers: In many rural communities, virtually all the growth in population and economic vitality has come from international immigrants and newcomers of color from other states or the metro area. Business and agribusiness leaders are warning that restricting immigration or policies that antagonize immigrants are a threat to our workforce. The Legislature should enact policies that continue to make rural Minnesota attractive to newcomers and people of diverse backgrounds and cultures. (Links: Immigrants Are Needed for Rural Business to Grow (Swift County Monitor-News; Top Business Leaders Call for Welcoming Immigrants (Pioneer Press); Business: State Needs More Immigrants (Mankato Free Press).
Child Care and Early Education: Demand exceeds supply in rural areas for both early childhood development needs and quality child-care, and the mismatch has been deemed a “crisis” by the Center for Rural Policy & Development. The Legislature must invest in a full toolbox of early childhood options and flexible funding streams so that our youngest children and their parents can access what they need to get a good start in those most crucial early years. Investments should be increased in: scholarships for high-quality programs for low-income families in the earliest years, voluntary pre-K programs in public schools, volunteer targeted home visiting programs, expansion of child-care recruitment and retention, and the Child Care Assistance Program for working parents. This investment may include funding to help offset the cost of new or upgraded child care facilities, regulatory changes that remove barriers to entry for providers, training for providers, and other policies and programs that will increase the supply of both center-based and home-based childcare option. (Links: Sources for details and multiple legislative proposals and investments for early childhood include the MinneMinds coalition, Think Small, and the Coalition of Greater Minnesota Cities’ 2018 Policy Positions on Economic Development)
Career Pathways: A workforce mismatch leaves too many in Greater Minnesota underemployed and too many employers unable to find skilled workers. The underemployed are disproportionately low-income workers and people of color who lack post-secondary credentials. More investment in new “fast-track’’ credentialing programs, featuring strong social supports and personal navigation to actual jobs in demand, will help move the underemployed into those high-skilled better paying jobs. (Links: MSPWIN and Growth & Justice provide detailed background research on the Career Pathway models and the Department of Employment and Economic Development’s Office of Adult Career Pathways lists options for local initiatives).
Local Education Partnerships: Higher education attainment levels in rural Minnesota lag behind the Twin Cities. Several Greater Minnesota communities (Itasca County, Austin, Red Wing, Northfield, St. Cloud, and the Southwest Initiative Foundation) are forming highly organized local partnerships focused on closing education disparities from birth through post-secondary completion. They are coordinating local efforts for early childhood education, providing after-school programs to mentoring and tutoring, post-secondary attainment and apprenticeships. The Legislature has begun to invest in the Education Partnership Coalition and should expand this investment to provide incentives for more partnerships. (Links: , Strive Together, annual report from Education Partnerships Coalition, recent “Grow Our Own’’ summit in southwestern Minnesota).
Low-Income Credits, Deductions and Federal Tax Conformity: Many rural regions, like some urban and suburban neighborhoods, contain significantly high percentages of low-income working families struggling to earn a living wage. Many households are paying too large a percentage of their income for rent. Revision of state laws to conform with the recent federal overhaul must not exacerbate tax regressivity in Minnesota for middle- and low-income families. The Legislature should protect or enhance credits and deductions for working families, including child-care deductions and the Working Family Tax Credit. (Links: overview of equitable state tax policy by Minnesota Budget Project.)
Broadband Access: High-speed Internet access is the great equalizer for Greater Minnesota, connecting households, businesses, and community institutions to participate in and contribute to 21st century economy and culture. Minnesota’s Office of Broadband Development (OBD) and its Border-to-Border Broadband Development Grant Program awarded $85 million in state funding since 2014 to leverage $110 million in matching local and/or private investments, making service available to more than 34,000 households and 5,200 businesses. With 47.12% of households in rural Minnesota in 2017 still lacking access at the state speed goal of 100Mbps/20Mbps, demand for this program continues to outpace funding. To help close that gap, the Legislature should extend the grant program and fund it at $51.48 million for 2018, and continue to fund the OBD as the coordinating hub for statewide broadband development. Links: Minnesota Rural Broadband Coalition, Governor’s Task Force on Broadband, Minnesota Office of Broadband Development broadband coverage maps.
Clean Water Infrastructure: A combination of aging infrastructure and stricter federal and state regulations has left many rural communities searching for ways to fund expensive upgrades required of their municipal water and wastewater treatment facilities. Gov. Dayton has recognized that cities need help, and proposed million in state bonding money to support clean water grant and loan programs. The Legislature should approve a robust bonding bill that includes at least $167 million for grant and loan programs that help cities pay for upgrades and repairs to wastewater and drinking water facilities. These investments are absolutely critical for economic development and to allow our cities to comply with clean water rules without imposing massive rate increases on businesses and residents. (Links: Coalition of Greater Minnesota Cities, Public Facilities Authority.)
Local Government Aid: Many Greater Minnesota cities rely on Local Government Aid (LGA) to allow them to provide quality public services and restrain regressive property taxes. Unfortunately, LGA is currently $30.5 million short of its 2002 funding level. The amount necessary to fully fund the needs identified by the LGA formula comes to an additional $250 million per year and should be a long-term funding goal of the Legislature. Supporting an increase in LGA means ensuring that all Minnesotans can continue to rely on excellent public services no matter where they live within the state. (Links: Dept. of Revenue – LGA, Coalition of Greater Minnesota Cities LGA policy statement.
Renewable Energy: The transition now underway in Minnesota away from dependence on imported fossil fuels and toward our own abundant wind and solar power represents tremendous potential for rural job growth and healthier self-reliant communities in Greater Minnesota. The Legislature should clear obstacles and provide incentives for an even more rapid renewable energy transition. Legislators also should recognize that local cooperative efforts and municipal utilities are often in the best position to determine the resource mix and to ensuring that equity is served in both pricing and the composition of the renewable energy workforce. Link: Overview of Renewable Energy effort in Greater Minnesota by Clean Energy Resource Teams (CERT).
Transportation: Rural areas rely on interregional highways and local city streets as vital economic connectors. With the state facing a funding shortfall for its transportation needs, Greater Minnesota needs creative solutions. Corridors of Commerce, a program created in 2013, provides funding to expand interregional corridors, reduce bottlenecks, and remove barriers to commerce. This program needs a permanent, ongoing funding source to ensure that important expansion and safety projects don’t go ignored. In addition, cities large and small have expressed serious concerns about their ability to keep up with the maintenance and repair of their streets. The Legislature has recognized these priorities in the past with one-time funding, but now is the time to search for long-term funding solutions to these problems. (Links: Corridors of Commerce, Coalition of Greater Minnesota Cities Transportation policy statement, Transportation Alliance, Transportation Forward).
Workforce Housing: Many communities in Greater Minnesota are ready and able to grow, but they are stymied by a shortage of housing for workers and their families. Initiatives that encourage the construction of workforce housing will allow Minnesota communities to continue to grow and expand their tax base. The Legislature should support tax incentives and other programs to encourage developers, investors, and local businesses to invest in the construction of middle-income housing where the market is currently not working. Many options for state investment should be considered but the Legislature should approve at least $20 million in funding for workforce housing grant programs focused on increasing the supply of units in communities that can grow now. These programs should have no income or population restrictions, and be focused on economic development. (Links: Greater Minnesota Partnership workforce housing proposal.)
Minnesota Rural Equity Project Partners