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Minnesota Economy

The Bureau of Economic Analysis estimatestied to the renewable energy market in the
that Minnesota's total state product in 2003state.
was $211 billion. Per capita personal income
in 2004 was $34,861, 8th in the nation. TheEnergy use and production A fair amount of
average household income in 1999 wasethanol alcohol fuel is produced in the
approximately $48,000, ranking eighth in thestate, and a 10% mix of ethanol into consumer
nation  (U.S.gasoline has been mandated since 1997 (as of
January 2006, Minnesota is the only U.S.
Census Bureau). The county averages rangestate with such a mandate). 20% ethanol will
from $17,369 (Todd County) to $42,313be mandated in 2013. A 2% biodiesel blend has
(Hennepin County, a portion of the Metroalso been required in diesel fuel since 2005.
area). In general, salaries are lowest inMany farmers also now operate wind turbines
more rural areas, particularly in theto produce electricity, particularly in the
northwest  portion  of  the  state.windy southwest region. As of January 2005,
the state is the country's fourth-largest
The state is a major food producer for thewind energy producer after California, Texas,
country and has a number of natural resourcesand Iowa, with 615 megawatts installed and an
that have been greatly exploited in the lastadditional  213  MW  planned.
two  centuries.
Like many Midwestern states, Minnesota is
Major industries and products The Twin Citiesheavily dependent on natural gas for home
are home to a diverse range of majorheating. Just over two-thirds of homes use
businesses, including Cargill, 3M Co.the fuel. The state does not produce any
(formerly Minnesota Mining and Manufacturingpetroleum of its own but boasts the largest
Co.), Northwest Airlines, Target Corporation,oil refinery of any non-oil-producing state,
U.S.the Pine Bend Refinery. One of the longest
pipelines in the world, the Lakehead
Bancorp, TCF Financial Corporation and TCFPipeline, also traverses northern Minnesota.
Bank, Medtronic, Ecolab, Best Buy, CrayMost of the petroleum used in the state comes
Computers, Imation, International Dairyfrom Canada and the northwestern United
Queen, Regis Corporation, General Mills,States.
Polaris Industries and a regional
headquarters of Wells Fargo & Co.,State taxes Minnesota has 3 brackets of
Caterpillar Inc., Honeywell, and Thriventincome tax rates, ranging from 5.35 percent
Financial for Lutherans (the merged entity ofto 7.85 percent. The sales tax in Minnesota
the former Aid Association for Lutherans andfor most items is 6.5 percent. The state does
Lutheran Brotherhood). The city of Rochesternot charge sales tax on clothing, services
is the headquarters of the Mayo Clinic, and(massages, haircuts, auto work, and the
has a significant manufacturing presence inlike), or food items for home consumption,
International Business Machines. The largestexcluding some specific items such as candy
shopping mall in the United States, the Mallor  soft  drinks.
of America, is located in Bloomington. The
Schwan Food Company, headquartered inAccording to state law, "Candy does not
Marshall, Minnesota, is one of the largest,include any preparation containing flour and
branded frozen-food companies in the Unitedmust require no refrigeration." (Minn Stat
States and the second-largest privately held297A.61 Subd 33). The state also imposes a
corporation  in  Minnesota.use tax on items purchased elsewhere but used
within  Minnesota.
Hormel Foods Corporation is headquartered in
Austin, Minnesota, it is a leading producerMinnesota property owners pay property tax to
in  meat  products.their county. Three factors that affect the
tax bill are: the amount the local
The state has been a major influence in thegovernments spend to provide services to the
area of transportation, moving products alongcommunity, the estimated market value of the
the Mississippi River, in and out of theproperty, and the classification of the
inland seaport of Duluth, along railroadsproperty  (how  it  is  used).
that crisscross the state, via highways with
trucking and busing companies, and throughMinnesota businesses and individuals paid an
the air with a major airline hub. However,average of 11.8% of their income in state and
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
State Product was just under $173 billion in
A large proportion of the state's economy is1999 (Northeast Midwest Institute), with
still agricultural, even though only a smallapproximately $17.5 billion in exports in
percentage of the population (around 2%)2000.
consider themselves to be farmers. Minnesota
is a leading US producer of sugar beets,Retail sales per capita were $10,260 in 1997,
soybeans, and corn. Additionally, northernhigher than the U.S. average of $9,190 (U.S.
Minnesota is a source for iron ore (in theCensus Bureau). The "retail capitol" of the
form of taconite) and wood products, thoughstate is probably the Twin Cities suburb of
these are both declining industries. HibbingRoseville, which recorded $14,870 per capita
is the site of one of the world's largest(though it is easily outstripped in total
open  pit  mines.revenue by Minneapolis, St. Paul,
Bloomington, and Edina).
The agricultural community is also strongly



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