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Minge bill puts subsidy debate on national ag... Page 5 of 6 <br /> Two years ago, 100 economists in eight Midwestern states signed a <br /> resolution urging an assault on government subsidies aimed at <br /> 111/ influencing site location decisions by business. <br /> But any attempt to curb subsidies is likely to be controversial, as <br /> economic development officials argue that public subsidies are <br /> important tools for making their communities competitive in <br /> business creation and expansion, and subsidy recipients fight to keep <br /> their claim on public money. <br /> Jay Novak, Minnesota commissioner of trade and economic <br /> development, said the state would benefit if some forms of special <br /> subsidies were eliminated, if only because other states spend far <br /> more to lure industry. <br /> "The state, and this department, has never outbid another state in a <br /> competition to provide incentives,"Novak said. <br /> Medtronic Inc. arrived at a similar conclusion when the company <br /> chose to expand its neurological products division in Columbia <br /> Heights with the help of$500,000 in low-interest loans and indirect <br /> subsidies to prepare the building site. It brushed aside larger offers <br /> from other states. <br /> The company spent$7 million on the expansion and is ahead of <br /> schedule in expanding its payroll by 150 employees, said Medtronic <br /> spokesman Dick Reid. <br /> "We can't say it was absolutely necessary to keep us from leaving," <br /> Ektiness Reid said of the state subsidy. "We intended to stay there." <br /> Nevertheless,the subsidy could have made the difference between <br /> expanding now or waiting, Reid said. <br /> The proposal has sparked skepticism among some local government <br /> and business officials. <br /> "Many communities across the country need some tools so they can <br /> stimulate growth," said Minneapolis Mayor Sharon Sayles Belton. <br /> Tax increment financing and other subsidies can make costly urban <br /> sites more competitive with cheaper rural or suburban locations <br /> chasing the same companies making location decisions, she said. <br /> Pam Wheelock, St. Paul director of planning and economic <br /> development, agreed that diminishing the value of targeted subsidies <br /> would put cities at a strategic disadvantage. <br /> "It would severely limit our ability to attract employers, which is <br /> • absolutely critical for jobs for people who live in these cities," she <br /> said. <br /> http://websery l.startribune.com/cgi-bin/stOnLine/article?stories=10&pgraphs=l&orderBy=PUB 12/3/97.&next <br />