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Minnesota Legislature: Wisconsin tax reciprocity being considered

ST. PAUL -- Minnesota legislators are considering reinstating a deal with Wisconsin so people who live in one state and work in the other do not need to file two income tax returns.

A bill studying the situation is set to be included in an overall tax bill later this legislative session and Rep. Greg Davids, R-Preston, said he plans a bill to reinstate the tax reciprocity arrangement. Then-Gov. Tim Pawlenty killed the reciprocity arrangement after Wisconsin fell 17 months behind paying what it owes Minnesota.

New Wisconsin Gov. Scott Walker told his state's legislators this week that the state owes Minnesota $60 million and his administration has said it is interested in bringing back reciprocity.

The reciprocity deal dates back to the 1970s, when state leaders decided to make it easy on thousands of people who crossed the border to work. Since more Wisconsinites work in Minnesota than the other way around, Wisconsin annually collected more money and owes the difference to Minnesota.

"The reason for reciprocity, of course, is to simplify tax filing," said Paul Wilson of the Minnesota Revenue Department.

Without reciprocity, thousands of people in both states this spring are filing tax returns to both Wisconsin and Minnesota, with some paying more because of the new arrangement.

Minnesota also has reciprocity deals with North Dakota and Michigan, but about an equal number of taxpayers cross those borders to work and no money changes hands.

Franken hires Juhnke

Seven-term veteran state Rep. Al Juhnke, DFL-Willmar, will go to work for U.S. Sen. Al Franken, DFL-Minn.

Juhnke, defeated by Republican Bruce Vogel last November, will handle Franken's agriculture, energy and environmental outreach duties. He will be stationed in Willmar, but travel the state for Franken.

"Al Juhnke understands how important agriculture, energy, and the environment are to creating jobs and spurring economic development in Minnesota," Franken said. "He has spent years working closely with key Minnesota groups, stakeholders and communities on these issues and knows how important they are to our state's economy and its future. We're all lucky to have him back in a role where he's serving the people of Minnesota."

At the end of his legislative tenure, Juhnke was the House Agriculture Committee's chairman.

Since losing re-election, Juhnke has remained in the public eye, producing a news summary of greater Minnesota issues.

Booting it up

Senators heard a report from the chief of Red Wing Shoe Co., who backed their plans to help Minnesota businesses.

Company President Dave Murphy told a committee that his company pays much lower taxes on its Missouri plant than in Minnesota. While he said that most of the company's shareholders live in Minnesota and the company plans to stay here, he encouraged them to lower taxes if possible.

Red Wing has a $52 million payroll at its headquarters and two Minnesota plants. The Red Wing-based company also has plants in two other states and sells in 100 countries.

Business is looking up, Murphy said, after the recession.

"When people don't work, they don't buy our boots," he said.

Don Davis works for Forum Communications Co., which owns the Bemidji Pioneer.