I want to thank the Star Tribune for the article "A medical debt surprise: Seized tax refunds," (front page, Dec. 13, 2020) identifying abuses of Minnesota's Revenue Recapture Act, a law created some years ago designed to collect debts on behalf of governments and public institutions. Over the years this law has been amended to include select private, and very prosperous, corporations.
I am a member of a citizen activist group called Health Policy Advocates, a nonpartisan collection of Minnesota citizens. Learning of this abusive subsidized debt collection by the state for these very select corporations from the article, we sought out our legislators to show them the problem in the law and craft a bill to solve it. We found enthusiastic, bipartisan support in both the Minnesota House and Senate.
Rep. Liz Reyer, DFL-Eagan, authored a bill in the House that would end the abusive practices for all private companies. A bill of more narrow scope was authored in the Senate by Sen. Jim Abeler, R-Anoka. Our group supports these bills.
The House bill (HF 363) got its second hearing in the House Tax Committee on March 10, and was passed on to the next level. We are now urging that the Senate companion bill get a hearing in the Senate Tax Committee chaired by Sen. Carla Nelson, R-Rochester.
I ran a national distribution company in Minneapolis for 35 years. When I needed to collect debts I had to use the courts and often hired a collection agency. It is outrageous to me as president of a small Minnesota business to learn that certain large and profitable private companies have their debts collected by the state for a mere $15 fee. Removing this offensive provision from state law does nothing to limit any other forms of collection by these companies.
If there were any justification for the state to do collection for private business, it would be for the 550,000 small businesses in Minnesota, the real economic engine for jobs and development in our communities. But even though collection of debt is a burden for smaller businesses, even they should not get this unwarranted special treatment at taxpayer expense.
These bills remove sections of state law that never should have been there. It is vitally important to get language that removes private companies from the Revenue Recapture Act into the omnibus tax bill. Ambulance services are included in this removal. However, those that are publicly owned should remain eligible for state assisted collection.
Please help us remove this embarrassing, special privilege in our law.
John Kolstad (aka Papa John) is president, Mill City Music.
