fedgazette

A game of subsidy chicken

Minnesota State Roundup

Published September 1, 2007  |  September 2007 issue

State taxpayers are being asked to kindly help with a couple of major business expansions, or else.

On the Iron Range, the state was expected to come in with about $30 million in infrastructure improvements to help the development of Minnesota Steel Industries (MSI), a $1.6 billion project that will build the region's first plant to process raw taconite through to finished steel. But the Legislature departed before earmarking the necessary funding to build connecting roads and install a natural gas pipeline and a short-line railroad spur to the site located in Nashwauk.

Construction was supposed to have started this past summer, but was dependent on state money to get early infrastructure in place before construction of the plant and reportedly to demonstrate to investors the state's willingness to support the plant.

In the Twin Cities, the Mall of America is requesting that the state put $192 million in next year's state bonding bill for a parking garage to complement an expansion of 5.6 million square feet of development that would include three hotels, a skating rink, a water park, a museum, a performing arts center and (of course) additional retail and other attractions.

The MOA has already been defeated twice on other proposals for public assistance. Mall officials have said the expansion cannot go forward without state assistance.

Ronald A. Wirtz

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