Grover Norquist jumps into Wisconsin's mining debate

2013-02-14T05:15:00Z Grover Norquist jumps into Wisconsin's mining debateRON SEELY | Wisconsin State Journal | rseely@madison.com | 608-252-6131 Journal Times

Grover Norquist, the powerful Washington, D.C., conservative and anti-tax crusader who has gained national fame by recruiting politicians to sign his no-tax increase pledge, has weighed in on the heated debate over proposed changes to Wisconsin's mining laws.

Norquist, president of the group Americans for Tax Reform, sent a letter to Wisconsin legislators Wednesday warning that they would be breaking their pledge not to raise taxes if they support a Democratic proposal to replace a tax on mining company earnings with a tax on iron production, called a tonnage tax.

A total of 21 state legislators have signed the pledge, according to Joshua Culling, ATR's Wisconsin manager.

Legislators received the letter Wednesday after State Sen. Scott Fitzgerald, R-Juneau, told a Wisconsin business group that Republicans oppose a tonnage tax that has been proposed in an alternative mining bill introduced by State Sen. Tim Cullen, D-Janesville.

Fitzgerald, Senate majority leader, told members of the National Federation of Independent Businesses that such a tax would constitute a new tax and "go completely against everything we have worked for over the last two years to state that Wisconsin is open for business."

The GOP mining bill instead includes a net proceeds tax, which would tax a mining company's earnings rather than the amount of iron being mined. Current mining law also includes a net proceeds tax, though the GOP bill would change current law so that 60 percent rather than 100 percent of those tax dollars go back to local communities affected by mining.

An alternative bill, introduced by State Sen. Tim Cullen, D-Janesville, includes a gross tonnage tax, similar to the tax on Minnesota mining companies and would make 100 percent of the tax dollars available to local communities. Cullen and other Democrats argue that the tonnage tax is more fair to local communities because it provides money during the early stages of a mining operation for such local needs as roads, school improvements, housing and law enforcement. Cullen also added that when combined with changes to the corporate income tax passed under Walker, the use of the net proceeds tax would result in a mining company paying dramatically less in taxes.

Officials with Gogebic Taconite, the company that wants to build a $1.5 billion open pit iron mine in the Penokee Range in northern Wisconsin, have indicated that they do not support a change to a tonnage tax.

Fitzgerald said instituting the tonnage tax "sends the wrong message" to the company. He also said any rewrite of mining laws that includes a tonnage tax would likely be vetoed by Gov. Scott Walker.

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(3) Comments

  1. just us
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    just us - February 14, 2013 9:32 am
    Didn't these legislators take an oath to serve the people of Wisconsin. and that must come before any slip of paper they signed for Grover Norquist. The Wisconsin corporate income tax drops to 0.4% by 2016 from the present 7.9%. This means the mine company through it's accountants, who will show little or no profit, will essentially pay nothing in taxes for the ore that they sell! The residents where the mine is located to which 60% of the taxes go will be left empty handed. The tonnage tax is the only way to insure that this mine compensates Wisconsin for destroying the environment and taking away our resources. This bill is a travesty!
  2. Joeboy5471
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    Joeboy5471 - February 14, 2013 9:28 am
    I thought the headline stated that Grover jumped down a "Mine Shaft". A Freudian slip of my imagination?
  3. Zorro
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    Zorro - February 14, 2013 12:13 am
    Grover who?
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