FFM Bulletin 4/18/11

Issue Backgrounder: Public and Private Sector Compensation in Minnesota

The Freedom Foundation of Minnesota recently released a report comparing public and private employee compensation and benefit figures for Minnesota. The study analyzed public and private sector data and recommend possible reforms and solutions to the growing problem.
From the report: “In an era of economic distress - high unemployment, perennial state budget deficits, soaring property taxes - it is not only appropriate, but necessary, for state and local government to acknowledge the economic realities facing its taxpayers, and to control spending accordingly. “
To view and download the entire public and private sector compensation report, visit our website www.freedomfoundationmn.com.

Register now for our April 28 event with gambling expert Dr. Earl Grinols

Join us on Thursday, April 28th as we welcome Dr. Earl Grinols as he discusses "Calculating the Social Costs of Gambling in Minnesota". Dr. Grinols, a Distinguished Professor of Economics at Baylor University, is one of the leading economic experts on gambling in the nation and has authored numerous reports and studies, including his book in 2004: “Gambling in America: Costs and Benefits.”
The event will be held at the Best Western Kelly Inn, 161 Saint Anthony Avenue, Saint Paul, MN 55103. Registration will open at 6:30 followed by Dr. Grinols remarks at 7:00 p.m.  This free event will end at 8:30PM.
To register for the event, please visit: ffmgambling.eventbrite.com/

Local municipal liquor report released

State Auditor Rebecca Otto recently released her Analysis of Municipal Liquor Store Operations report for Minnesota cities for 2009. As described in the report, the comparative data can assist city officials in their management of liquor store operations.
A few interesting findings from the report include:

  • Over the past five years, net profits have increased 16.4 percent. Among off-sale stores, there was a 23.9 percent increase in net profits, while on-sale stores (city-run bars) showed a decrease of 23.7 percent
  •  Thirty-eight Minnesota cities reported net losses for 2009, compared to 42 cities in 2008. All 38 cities with losses were from greater Minnesota.
  •  During 2009, Minnesota’s municipal liquor stores transferred $16.5 million of their profits to other city funds. This represents a decrease of 7.0 percent from the total net transfers made in 2008.
  •  Due in part to the lack of profitability, insurance costs, and other concerns, the number of cities operating municipal liquor stores has steadily declined
Cities in Lake County fit many of the statewide trends, according to an article in the Lake County News Chronicle. The City of Beaver Bay had a net loss of $2,120 in 2009, it’s first year ever in the red. Also, according to 2010 numbers released at a Silver Bay city council meeting, that community continued their downward trend of liquor store revenue in 2009. Silver Bay’s City Administrator cited a large wedding in 2009 as a reason for the $31,341 decline in 2010 numbers. For the city of Two Harbors, transfers from the city run liquor store were used to cover losses at the city-run Lakeview National Golf Course.
These examples of Lake County cities continue to question whether or not cities should be involved in the liquor store business at all. With private options available, taxpayers would be better served without picking up the tab for other citizens’ activities at the bar or on the links.

Costly Minneapolis bike rental program returns for 2nd season

The Minneapolis based Community Partners Bike Library program that lends bikes to community members is back for another year, this time with more bicycles and another $110,000 in taxpayer funding. 
According to the program’s website, the Library will provide 220 fully equipped bicycles, locks and helmets for 6-month loans to low-income community members. They also provide bicycle safety classes and bicycle purchasing and maintenance support. That brings the total price to roughly $500 per bike if all 220 are distributed. A stated purpose of the program is to encourage these residents to develop a love of bicycling and are currently not part of the “mainstream bicycling community.”
But unlike an actual library, the program relies on the honor system for returning bikes once the rental period is over. Last year 30 percent of the bicycles were not returned.
Said program director Claire Stoschek on the issue, “Honestly, I’m pretty impressed with how many came back.” Wow. It’s hard to imagine any business that would survive an annual loss of 30% of their inventory stolen by their “employees.”
The Community Partners Bike Library was started last year through a $193,000 grant from Bike Walk Twin Cities, and one of several programs to receive a portion of the $22 million federal grant dedicated to increasing walking and bicycling in the Twin Cities. If Washington is serious about budget cuts, they can start here.

Thanks, but no thanks! MN tribes reject $1.7 million in stimulus funds

When is the last time the recipients of a $1.7 million federal stimulus grant had second thoughts and sent the funding back to Washington?
In an all too rare “good government” story, tribes from northern Minnesota sent back a federal stimulus grant after the math didn’t add up for the high-tech Headwaters Tribal Community project. According to Leech Lake Band officials, after closer scrutiny of the project, they concluded that the final price tag for the project would be significantly more than the amount submitted in the grant application, prompting officials to forgo the project and the stimulus grant.
Read the entire Accountability Alert on our website.


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