Minnesota Economy

The Bureau of Economic Analysis estimates thatthe renewable energy market in the state.
Minnesota's total state product in 2003 was $211Energy use and production A fair amount of
billion. Per capita personal income in 2004 wasethanol alcohol fuel is produced in the state, and a
$34,861, 8th in the nation. The average household10% mix of ethanol into consumer gasoline has
income in 1999 was approximately $48,000,been mandated since 1997 (as of January 2006,
ranking eighth in the nation (U.S.Minnesota is the only U.S. state with such a
Census Bureau). The county averages range frommandate). 20% ethanol will be mandated in 2013.
$17,369 (Todd County) to $42,313 (HennepinA 2% biodiesel blend has also been required in
County, a portion of the Metro area). In general,diesel fuel since 2005. Many farmers also now
salaries are lowest in more rural areas, particularlyoperate wind turbines to produce electricity,
in the northwest portion of the state.particularly in the windy southwest region. As of
The state is a major food producer for theJanuary 2005, the state is the country's
country and has a number of natural resourcesfourth-largest wind energy producer after
that have been greatly exploited in the last twoCalifornia, Texas, and Iowa, with 615 megawatts
centuries.installed and an additional 213 MW planned.
Major industries and products The Twin Cities areLike many Midwestern states, Minnesota is heavily
home to a diverse range of major businesses,dependent on natural gas for home heating. Just
including Cargill, 3M Co. (formerly Minnesota Miningover two-thirds of homes use the fuel. The state
and Manufacturing Co.), Northwest Airlines, Targetdoes not produce any petroleum of its own but
Corporation, U.S.boasts the largest oil refinery of any
Bancorp, TCF Financial Corporation and TCF Bank,non-oil-producing state, the Pine Bend Refinery.
Medtronic, Ecolab, Best Buy, Cray Computers,One of the longest pipelines in the world, the
Imation, International Dairy Queen, RegisLakehead Pipeline, also traverses northern
Corporation, General Mills, Polaris Industries and aMinnesota. Most of the petroleum used in the
regional headquarters of Wells Fargo & Co.,state comes from Canada and the northwestern
Caterpillar Inc., Honeywell, and Thrivent FinancialUnited States.
for Lutherans (the merged entity of the formerState taxes Minnesota has 3 brackets of income
Aid Association for Lutherans and Lutherantax rates, ranging from 5.35 percent to 7.85
Brotherhood). The city of Rochester is thepercent. The sales tax in Minnesota for most
headquarters of the Mayo Clinic, and has aitems is 6.5 percent. The state does not charge
significant manufacturing presence in Internationalsales tax on clothing, services (massages,
Business Machines. The largest shopping mall in thehaircuts, auto work, and the like), or food items
United States, the Mall of America, is located infor home consumption, excluding some specific
Bloomington. The Schwan Food Company,items such as candy or soft drinks.
headquartered in Marshall, Minnesota, is one of theAccording to state law, "Candy does not include
largest, branded frozen-food companies in theany preparation containing flour and must require
United States and the second-largest privatelyno refrigeration." (Minn Stat 297A.61 Subd 33).
held corporation in Minnesota.The state also imposes a use tax on items
Hormel Foods Corporation is headquartered inpurchased elsewhere but used within Minnesota.
Austin, Minnesota, it is a leading producer in meatMinnesota property owners pay property tax to
products.their county. Three factors that affect the tax bill
The state has been a major influence in the areaare: the amount the local governments spend to
of transportation, moving products along theprovide services to the community, the estimated
Mississippi River, in and out of the inland seaportmarket value of the property, and the
of Duluth, along railroads that crisscross the state,classification of the property (how it is used).
via highways with trucking and busing companies,Minnesota businesses and individuals paid an
and through the air with a major airline hub.average of 11.8% of their income in state and
However, water- and rail-borne traffic has beenlocal taxes in 1998, down from 12.7% in 1996
declining steadily over the years.(Minnesota Department of Revenue). The Gross
A large proportion of the state's economy is stillState Product was just under $173 billion in 1999
agricultural, even though only a small percentage(Northeast Midwest Institute), with approximately
of the population (around 2%) consider$17.5 billion in exports in 2000.
themselves to be farmers. Minnesota is a leadingRetail sales per capita were $10,260 in 1997,
US producer of sugar beets, soybeans, and corn.higher than the U.S. average of $9,190 (U.S.
Additionally, northern Minnesota is a source forCensus Bureau). The "retail capitol" of the state is
iron ore (in the form of taconite) and woodprobably the Twin Cities suburb of Roseville, which
products, though these are both decliningrecorded $14,870 per capita (though it is easily
industries. Hibbing is the site of one of the world'soutstripped in total revenue by Minneapolis, St.
largest open pit mines.Paul, Bloomington, and Edina).
The agricultural community is also strongly tied to