Minnesota cities breathing easier from boost in state aid
- Blog Post by: Lori Sturdevant
- June 19, 2013 - 1:48 PM
There was plenty of talk about breathing easier and the end of a long fiscal storm among the eight mayors who joined state Revenue Commissioner Myron Frans Wednesday to hail the 2013 Legislature's big boost in state aid to cities, through a revamped Local Government Aid (LGA) program.
The $80 million increase over three years is the first substantial boost cities have seen since the program was slashed in 2002-03. As Mayor Dave Smiglewski of Granite Falls explained, the increase will mean that in 2014, his city will receive about as much in state aid as it did 12 years ago.
Of course, there's been a dozen years of inflation since then. Total LGA funding in 2014 will still lag the 2002 level by $60 million, not counting inflation.
Nevertheless, the mayors were all smiles, particularly as they described the enhanced predictability the new formula promises. Rochester Mayor Ardell Brede said that the old formula's wild variability and the willingness of politicians to put LGA on the chopping block were almost as irritating as the LGA cuts themselves.
This year's boost will stil only get Rochester's LGA allotment back to about 60 percent of its 2002 level, Brede said. But the new formula caps how much variation in allotment any given city can experience in one year. That will be a big asset to city budgeteers, he said.
Yet that formula improvement can only go so far to shield cities from future cuts occasioned by a change in either economic or political winds. The two Twin Cities mayors, R.T. Rybak of Minneapolis and Chris Coleman of St. Paul, both said cities should both step up their search for more operational efficiency and catch up on deferred maintenance now.
If anything, the last 12 years should have convinced the stewards of Minnesota governments at all levels that uncertainty is the only certainty. Many city leaders have told me in recent years that they no longer count on LGA for ongoing expenses. They use it instead for one-time projects, particularly ones that lead to more efficient services. That might be the best way for cities to think about the LGA increase that's coming in 2014.
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