A tax-free zone bill, a top priority of Republicans, was introduced in the House Thursday and will be discussed in the Jobs and Economic Development Finance Committee. The committee’s vice chairman, Rep. Dan Dorman, R-Albert Lea, who coauthored the bill, said he thinks Freeborn County has a good chance to benefit from the measures.

The bill, which Gov. Tim Pawlenty also advocates, will allow the Commissioner of Economic Development to designate a site up to 5,000 acres located outside the metropolitan area as a tax-free zone.

Businesses operating in the zone would be exempted from property taxes and state income and sales taxes for up to 12 years. The zone can be used for housing development, which would waive the taxes for the residents.

&uot;I think everyone sees the need for expanding the tax base. A lot of people will be jumping on this,&uot; Dorman said.

House Speaker Steve Sviggum mentioned he would expect around 10 tax-free zones in the state. But, the numbers are contingent on the budget the legislature allocates to the projects.

Under the plan, state aid would reimburse up to half of the exempted property-tax amount in the zone to the city or county, according to the proposal. It is uncertain how much the legislature can spare for the aid account, considering the state’s $4.56 billion budget deficit.

Dorman expects that competition to win the tax-free designations will be tough.

A local government will have to submit a development plan that describes proposed methods for increasing economic opportunity and expansion, facilitating infrastructure improvement, reducing the local regulatory burden, and identifying job-training opportunities to win the nomination. Besides, the applicant would need to prove the community’s consent on the project.

Dorman said the city and county, as well as a number of individuals from the Greater Jobs, Inc. and Freeborn-Mower Cooperative, have shown interests, though the discussion has just started.

&uot;I think a community is going to win when the community brings the best partnership together among the development corporations, private people and governments,&uot; Dorman said. The old Farmland site, Habben Industrial Park and the area around EXOL near Glenville would be potential candidates for the zone, Dorman suggested.

Priority would be given to communities where:

– The percentage of the population below the poverty level is high.

– The unemployment rate is significantly higher than the state average.

– Properties in or near the zone are deteriorated or underutilized.

– Housing in or near the zone is deteriorated.

– The median family income of the area is lower than the state median family income.

– The population decreased between 1980 and 2000.

– A sudden or severe job loss as a result of closing of businesses or other employers occurred.

– Properties in the area would remain underdeveloped or non-performing due to physical characteristics.

– Real property with adequate infrastructure and energy to support new or expanded development exists.

&uot;I am very optimistic. Plus, I think would that Freeborn or Mower, the county or the city, whoever brings that group together, we’re going to make make just an awesome presentation, given the opportunity,&uot; Dorman said.

Democrats have been skeptical about the effectiveness of the measure. House Minority Leader Matt Entenza said to the press the tax-free zones would simply shift the cost of doing business from one area to another.

But, Dorman said applying for the program is up to the community. &uot;It’s going to be a hard case to make that we don’t need this when you look at how Ford Motor Co. jumped away,&uot; he said.