Equalization & the Minnesota Miracle

 

The Minnesota Miracle of 1971 resulted from a ten-year effort to restructure Minnesota’s fiscal policy. Major contributors to the effort were Paul Gilje, then research director of the Citizens League; Representative Charles R. Weaver of Anoka; the Metropolitan Council; the 1967-1971 Republican legislatures; and state Senator Wendell Anderson, the 1970 Democratic gubernatorial candidate, elected governor, who campaigned on a pledge to make sweeping changes in the financing of schools and of local governments.

Rising public discontent with soaring property taxes created the ferment for needed reform of long-established policies: local governments and school districts were financed solely through autonomously levied property taxes; municipalities were forced to compete for commercial-industrial development to boost their tax base; and disparities in the quality of education between property-tax-rich and property-tax-poor districts were egregious. Reform laws enacted to resolve those issues, taken together, came to be known as the Minnesota Miracle of 1971. The Minnesota Miracle survived, relatively unchanged, for more than 30 years until 2002, when the property tax structure was again revised by legislative action. [Source: Minnesota History Topics, The Minnesota Miracle.]

The longest special session was held in 1971.* It lasted 159 calendar days and dealt with the “Minnesota Miracle,” an initiative of then-Governor Wendell R. Anderson. The session convened on May 25 and adjourned over five months later on October 30. Ironically, the property tax reform that was enacted in 1971 and has served Minnesota so well is proposed to be undone in this special session. And although the property tax changes being proposed at that time were equally sweeping as those being proposed today, there was no threat of a government shutdown. [October 26, 2001 – Special Sessions Not All That Special, State Representative Rod Skoe.]

* Note: The 1971 special session did not include a state government shutdown. More information on Minnesota government shutdowns.

 

Additional Resources

August 1, 2008 – Meeting Summary – Provides an update on tax structure changes since the Minnesota Miracle, Governor’s 21st Century Tax Reform Commission

June 2008 – One Bad Deal – Anything drenched in enough sour cream, horseradish and dill will be edible… with that in mind, I’d like to reconsider the single most significant legislative act of the past ten years: Governor Pawlenty’s 2003 biennial budget and revenue restructuring deal. …In one fell swoop, Governor Pawlenty and his conservative public policy allies reversed 1971’s Minnesota Miracle, Minnesota 2020 Journal.

September 2006 – The Minnesota Miracle Abandoned? Changes in Minnesota School Funding, 2001-2007 – The state had now come full-circle with regards to the financing of its public schools. While conceptually wanting to fully fund Minnesota public schools at the state level in 2001, by the 2007 school year, the state had offered greater incentives than ever for schools to fund locally, Rural Minnesota Journal (Power Point).

April 2006 – City and county aid loss and property tax increases due to the 2003 session reductions, Research Department, Minnesota House of Representatives.

October 30, 2005 – What happened to the Minnesota miracle?, Pioneer Press.

March 24, 2005 – The Minnesota Miracle – Remarks by Joel Kramer, Executive Director and Founder of Growth & Justice at a Hamline University panel discussion on the impact of the “Minnesota Miracle.” 

March 2005 – Minnesota Realtors Survey – Shows Strong Support for Public Schools, Mixed Feelings About Equalization.  Minnesotan’s agree public education should be the highest priority of the state, but show mixed feelings about whether local government services should be provided for by state or local taxes.

March 7, 2003 – Restructuring funding: Pair of bills would alter the way that local government aid is allocated to Minnesota cities, Session Weekly (page 3).