Mayors and other elected officials from outstate Minnesota are pressuring House Republicans to support increased state spending on government aid to cities and towns, hoping to capitalize on the increased importance of rural voters to the GOP’s power at the Capitol.
“I think there is a golden opportunity to help build a bit of progress in terms of this needed, helpful asset to rural Minnesota,” Robert Broeder, mayor of Le Sueur and president of the Coalition of Greater Minnesota Cities, said Tuesday in a conference call with journalists and local leaders. Broeder charged that House Republicans last year “insisted on undermining LGA,” the acronym for the state’s local government aid program.
Rep. Steve Drazkowski, R-Mazeppa, is the House GOP’s lead on property taxes. He said House Republicans would not get behind any local government aid increases this year.
“Last year we fully funded the government, in all categories, for the next two years,” Drazkowski said. “Our effort going forward is going to be to provide the relief to overtaxed Minnesotans that is needed to get us up and moving again.”
Fights over local government aid rates are a perennially thorny issue at the Capitol. Last year, the House on a party-line vote approved a GOP plan to slash state aid to just three cities — Minneapolis, St. Paul and Duluth. That bill is still stalled in the legislative process, but the debate is likely to flare again when lawmakers reconvene in March.
In 2013, the Legislature approved $424 million in local government aid. In all, 770 Minnesota cities benefit, based on a formula that weighs local tax capacity per capita and a series of “need” factors like the age of housing stock and the amount of exempt property.
LGA was established to help relieve pressure on local property taxpayers; some communities, particularly in the Twin Cities suburbs, don’t qualify at all.
Last year, House Republicans, Senate DFLers and DFL Gov. Mark Dayton were not able to agree on a final tax bill that would have set LGA rates going forward; without legislation this year, they will remain at 2013 rates. The Coalition of Greater Minnesota Cities, which represents dozens of communities on the LGA rolls, is calling for a $45 million increase.
“We have a state surplus, and now is the time to give cities a boost,” said Audrey Nelsen, a member of the Willmar City Council. Late last decade, former Gov. Tim Pawlenty successfully pushed reductions in local government aid in the face of recurrent budget shortfalls. Nelsen said Willmar’s 2016 allotment will be less than what the city got in 2007.
“We have deferred projects, and we are looking for ways to catch up with needs at our facilities, roads and parks,” Nelsen said.
Outstate officials and lobbyists predicted that scenario would multiply across Minnesota. Many recipient cities, particularly small towns, rely on the program for 50 percent or more of their total yearly budgets.
“That means significant property tax increases or drastic cuts in services,” said Marty Seifert, a former House GOP leader who now lobbies for the Coalition of Greater Minnesota Cities.
The group, which includes elected leaders of all political stripes, recently voted to make the $45 million increase its top priority.
There is political risk to House Republicans if they appear unresponsive to such a request. In 2014, the GOP won its current House majority almost entirely by gaining a handful of seats in outstate Minnesota districts. Many are peppered with communities that rely heavily on local government aid.
While it represents cities outside the Twin Cities metro, the coalition has stood firm against the House GOP effort to diminish LGA payments to Minneapolis, St. Paul and Duluth; the calculus there is that without support of the many legislators from those three cities, the entire aid system would collapse politically.
Drazkowski said such spending benefits government officials and their lobbyists in St. Paul, not actual rural voters. He said such voters would be more impressed by the GOP’s tax plans, which includes property tax reductions for farmers and businesses.
“It’s amazing to me that we see some communities that over and over again [are] doing a good job managing the people’s money, and then some that do not,” Drazkowski said. “I would encourage some of those mayors and council members to visit their colleagues who have figured it out.”