Minnesota Chamber of Commerce President Doug Loon has a simple request for the Legislature: Do no harm.
Businesses are struggling to survive pandemic restrictions, and any additional tax burden could tip the scales.
One uncertainty for businesses concerns the federal Paycheck Protection Program (PPP), which started as loans to businesses so they could keep employees on the payroll during shutdowns, but became forgivable loans if participating businesses followed PPP parameters.
Late last year, the federal government decided not to tax the forgivable loans as income, but the state Legislature hasn't acted yet to follow suit.
"The state has the resources," Loon said, citing Minnesota's projected $1.6 billion budget surplus announced in February.
Rochester restaurateur Joe Powers says uncertainty over the PPP loans adds to the stress small business owners feel right now. "I don't think (Gov. Tim) Walz understands how his actions affect small business." Taxing those federal loans as income would be devastating, he says.
On Wednesday, the Minnesota Executive Council extended the state's peacetime emergency for another 30 days. The extension gives Walz the authority to issue executive orders without legislative approval. He previously used that power to mandate masks, limit business capacity and shrink social gatherings. He has said that he has no immediate plans to implement new restrictions at this time.
Republicans have bristled at Walz's extended authority, saying it locks them out of important decisions. But Walz and health officials say they need the ability to quickly react to health threats from a growing number of COVID-19 variants.
“The way the virus acts, we will respond accordingly. If we start to see numbers go back up, we will see if there’s things that need to happen," Walz said. "At this point in time, we don’t have plans to do that. We think that the mitigation measures that are in place are working."
And that is the hope – that a corner has been turned on the pandemic and we'll soon be operating under a new normal. We think that new normal should involve both parties. As the only state in the Union with a divided legislature, let's show people how it's done. Let's get both parties involved with determining how Minnesota can come out of this pandemic with a stronger economy, small business base and social structure. That's a lot to ask of Walz, DFLers, Republicans and everyone in between. Especially since the legislative session ends May 17.
And as for the state's business climate, Loon thinks Minnesotans are poised for recovery.
"There has even been an uptick in startups during the pandemic," he said.