What Will State Shutdown Mean for Small Business?

One local merchant predicts the shutdown of state government will actually boost his business.

“It’s too bad that it’s got to this,” said Tommy Drummond, owner of Tommy’s Tonka Trolley.  “I hate to say this, but it’s probably going to benefit my business because there is going to be a lot of people who can’t go to campgrounds now."

Tommy’s Tonka Trolley is a familiar summer sight in Excelsior and serves ice cream and other treats to those passing by its Lake Street location. The kiosk also rents kayaks to those looking to paddle Lake Minnetonka. Business was brisk as temperatures approached triple digits Thursday.

Drummond normally sees steady traffic from June through August, but he said a state shutdown happening just ahead of a major holiday weekend could mean his busiest days of the year are fast approaching.

"They’re going to stay home locally and be coming to Excelsior and going out in our kayaks and buying ice cream rather than going to the state parks and some areas that are funded by the government,” he said.

Even Drummond concedes he's in the minority of business owners who will benefit from a shutdown.

The impact of a state government shutdown on Minnesota’s nearly 164,000 businesses, from retailers and real estate agents to corporations and cosmetologists, will be difficult to measure “due to the diverse landscape of businesses,” said Tom Hesse, an executive at the Minnesota Chamber of Commerce.

Hesse predicted most businesses will feel only a minimal impact from a short-term shutdown, but those most affected would be companies with contracts to provide goods or services to the state.

Brian Steinhoff, president of the Minnesota Retailers Association, said he hasn't heard an outcry from his membership. A shutdown of two weeks may not have much of an impact on retailers and local economies, he said, but that outlook would change for a shutdown running longer.

“We’re in uncharted territory here,” Steinhoff said.

Perhaps the biggest business loser would be the construction industry.

The Associated General Contractors of Minnesota estimates 5,000 to 10,000 construction workers will be laid if the state shuts down dozens of road and highway projects, and the group contended a prolonged shutdown would be devastating to small and new general contractors.

The Roseville-based Builders Association of the Twin Cities said a state shutdown would halt the work of the Minnesota Board of Electricity, suspending state electrical inspections on construction projects in communities that don’t have their own in-house inspectors or that contract for such service.

Excelsior, Long Lake, Minnetonka Beach, Navarre, Orono, Tonka Bay and Wayzata are among the dozens of Minnesota municipalities where the state has jurisdiction over administration and enforcement of Minnesota’s electrical code.