Today in History: April 17, 1985 - N.W. Minnesotans think Saturn bait may be too much

Today in History revisits the Wednesday, April 17, 1985 edition of the Grand Forks Herald and highlights a story from Minnesota.

In the article, northwest Minnesotans express mixed feelings about Governor Rudy Perpich's aggressive $1.3 billion incentive offer to lure General Motors’ Saturn plant to Minnesota. While many appreciated Perpich’s efforts to bring jobs and economic growth to the state, several residents and business owners worry that the tax breaks and financial incentives may be excessive and unfair to existing businesses. Critics voiced concerns over fostering unhealthy competition between states and potentially neglecting local companies. Some, like East Grand Forks Mayor Louis Murray, fully supported Perpich’s plan, believing the economic benefits outweighed the cost. Others suggested a more balanced approach, ensuring existing businesses also receive support.

By Mike Brue
Herald Staff Writer

Northwest Minnesotans generally like the direction Rudy Perpich is trying to steer General Motors’ Saturn auto plant.
But many are skeptical of the $1.3 billion in financial shortcuts the governor has offered to get the small-car plant to Minnesota.
That is the result of unscientific sampling of opinions gathered via telephone by the Herald in recent days.
“I think his idea is good, but he may be giving away too much tax incentive to get them in,” said Roy Lee, Thief River Falls, Minn., manager of Lee’s Plumbing and Heating.
Minnesota and 26 other states are trying to become GM’s choice for the site of a $3.5 billion, computer-oriented auto plant. The winner is expected to get 6,000 new plant jobs — many filled from out of state — and 14,000 related jobs.
Perpich has offered to spend $93.6 million in state revenue for property, employee services, training centers and other items for the Saturn plant. GM would get $804 million more in corporate income, sale and property tax breaks over 30 years. About $371 million in private contributions and support to Saturn also has been offered.
Perpich has called Minnesota’s offer the best of any state. The public share would require legislative approval.
“He’s offering them quite a plum, isn’t he?” said Clarence Clementson, a retired Erskine farmer. “Is that fair to everybody else? It’s hard to know what’s right or what’s wrong, isn’t it? It’d be a wonderful thing, I’m sure, to add all those jobs.”
But Clementson, 71, said he is concerned about the growing competition for jobs and big industry. “That’s a trend that’s going to wreck the country,” he said. “All these businesses getting these big breaks. We’re going to get into a trend where all these states are competing against each other. I don’t know if I like that.”
Betty Jeffrey of East Grand Forks, said Minnesota should try to attract new industry, but “there’s so many businesses that are going out of business in the state, I think we should dwell on them.”
“I think if money’s going to be spent, it should be spent fairly,” said Jeffrey, a former convenience store manager. “I think there should be incentives for businesses that are already here.”
As an example, she said, more should have been done to keep Old Dutch from ending operations in East Grand Forks a year ago this month.
Thief River Falls’ Lee shares much of Jeffrey’s view. He believes Perpich’s offer might be more appropriate had it first been studied by the Legislature.
“I sure would like to see more business come in,” Lee said. “But if he’s going to give them those extra high tax breaks, I think businesses that are here are going to have to ask for some of those, too. Just because a business is here for 20 years, there’s no reason it should pay more taxes than someone new coming in.”
Wallace Champagne, a self-described retired “jack-of-all-trades” from Brooks, Minn., said he likes the Saturn package, based on what he has heard.
“I mean, it’s a good deal,” Champagne, 74, said. “Any time you can bring something in the community is good. It would be a good trade-off, the jobs and that extra money coming into the state.”
Donald Wester, 53, a Fosston farmer, said he is for GM’s coming to Minnesota. Wester said the extra jobs and dollars brought into the state would offset the incentives Perpich is offering.
“I don’t like giveaways, first of all,” Wester said. “But I realize you have to give something to get something. ... I guess maybe this one thing is an exception.”
But Wester said he has been skeptical of Perpich’s efforts to bring new industry into Minnesota.
“He’s made a lot of smoke, he’s spent a lot of money, but he hasn’t returned very much,” Wester said. “He’s kicked around the world and around the country. For the money he’s spent, very little has been returned.”
But East Grand Forks Mayor Louis Murray thinks Perpich deserves commendation for the effort he has made to lure Saturn to Minnesota. Murray believes the state would get more than it gives.
“They say weather and transportation work against Minnesota,” Murray said. “But Michigan has as bad of weather as we do. I hope to heck we can get it.”
Murray said he would prefer to see the plant built in Duluth, where unemployment is high, than in the Twin Cities suburb of Cottage Grove. Perpich has offered those two cities as potential Saturn sites.
How about East Grand Forks? “I know if they would come in here,” Murray said, “I’d guarantee I’d buy one of those Saturn cars.”