The Iron Range Resources board met yesterday and remains stymied over the 2009 budget. A provisional budget was passed and there will be yet another meeting scheduled to resolve the matter. (Read today’s story from the Mesabi Daily News).
At issue were the complaints of Rep. Tom Rukavina (DFL-Virginia) who was critical of the concept of hiring a business recruiter for the agency and much of the staff time spent on various meetings. You’ll recall that Iron Range Resources is the state agency dedicated to public works and economic development using local mining tax revenue.
Rukavina was able to hold off passage of the vote by virtue of there not being enough “yes” votes in attendance. He eventually related on the matter of hiring the business recruiter. When the board meets in full, the budget will likely pass, but Rukavina has made his point.
I don’t want to declare one side in this right or wrong; I think there’s some of both. But Rukavina raises some very good points. I would argue there are some fundamental problems with how economic development has been practiced on the Range for the last decade, not just by the agency, but by the cities and chambers across the region. We need to build an environment where jobs are created naturally. We can’t just go out and “snag” businesses like they were crappies. It doesn’t work that way.
And, since conservative tax cut programs like JOBZ have had mixed results at best, we need to consider the fact that the most economically liberal DFLers and most fiscally conservative Republicans, and many of those in between, need to adjust to find a solution.
Meantime, the MDN did a story in which local legislators/IRR board members get grumpy about there being no new economic development projects going on right now. Hey guys. High speed internet proliferation across the Iron Range. That’s a pretty good project, since you’ve got money burning a hole in your pocket.
Don’t get the jobs; grow the jobs.
Aaron,
Do you know how much money the agency has available right now? It would be interesting to see an analysis of how much money is available for projects like high speed internet compared with how much it would cost. Some factors on the cost side would be whether it is installed in every home and business for free vs if users are charged a cut rate (example: $10 per month per user).
I think the discretionary budget was in the neighborhood of $13 million. Much of the other revenue is tied up by statute to be distributed to towns, townships, and schools for property tax relief. I want to say about $5 million or more was proposed for public works and the rest for administration of the agency and economic development. The debate is over the best way to spend that money.
I don’t think Iron Range Resources could afford to put broadband in everyone’s house for free, but I am proposing that it be considered the same as electricity and phone service. We should regulate and, where necessary, support increased access independent of commercial demand (Just like the TVA). I don’t think people will actually get free internet, but everyone, everywhere (in the taconite tax relief area) should have the ability to get reliable, fast internet for the same price or less than their basic phone bill. Bandwidth usage can be free at low levels and then charged at a graduated rate as usage goes up. Private companies will say they’re doing this now, but not universally and not affordably for some. Those same companies could deliver and compete for the service, but it will take a public entity to ensure that there’s enough capacity for everyone and all the people we want to attract here. The main problem is the initial expense of getting broadband out to everywhere that currently has phones and electricity. Many of the towns are already wired, but there are pockets that would need substantial investment. Considering that new residents often seek out country properties, this may be worth it.
And if mining revenue spikes in coming years, we can consider keeping rates even lower or even try some unique programs such as free internet for job-creating companies or self-employed people and/or e-commuters.
But watching the interaction between the private company lobbyists and public broadband proponents tells me that we have to go public/private on this one or nothing will ever happen.