Citys legislative agenda focused on state aid

Though Minneapolis has a wish list 15 pages long for state lawmakers in 2011, city leaders have focused their legislative agenda on one thing: Getting the state aid the city needs to hold the line on property taxes.

The agenda has requests ranging from things like health studies on artificial turf to continued funding for light rail in Minneapolis — some issues have been on the city’s agenda for several years. But the primary goal for the city’s lobbying team is keeping as much as possible of the $87.5 million in Local Government Aid the city was certified to receive from the state in 2011.

“We are really focused on the big picture, which is revenue sharing between the city and the state,” said City Council Member Elizabeth Glidden (8th Ward), who is chair of the city’s Intergovernmental Relations Subcommittee that drafts the legislative agenda.

Glidden said the LGA focus does not mean Minneapolis won’t still try to get policies changed at the Capitol that help out the city, but she acknowledged it would be harder since the DFL lawmakers who were friends of Minneapolis are now serving in the minority. Minority members have a much harder time introducing bills.

Glidden said Minneapolis is collaborating more with cities across the state in order to get help from the Legislature.

“A lot of the new policy issues out there are ones that have broad agreement from cities across the state, that something needs to happen,” she said.

The LGA waiting game

Local Government Aid has been a moving target for city budget planners over the last couple years as the state Legislature has cut the program’s funding.

In 2009, Minneapolis was supposed to get $88.7 million but had its allocation cut to $80.2 million. In 2010, the city was set to receive $90 million, but only got $64 million.

Since LGA has been a victim of budget cuts recently, the city of Minneapolis adopted a 2011 budget resolution that would enact cuts based on what the governor proposed in his budget.

Gov. Mark Dayton released his budget on Feb. 15 and he protected all LGA funding from cuts, and instead proposed an income tax hike on the state’s top earners.

The GOP-controlled Legislature, however, has passed even deeper cuts: A $23 million reduction in LGA as well as a $6.5 million cut to Market Value Credit, money paid to Minneapolis. If additional cuts are necessary, the City Council will have to vote on where to do the trimming.

As in previous years, final LGA cuts may not be passed until the end of the legislative session in May.

“It’s a real tough time for anybody in city government to try to figure out how to best keep the cops on the streets and the firefighters in the fire halls ready to fight fires when the state is reducing the monies they share with us,” said Gary Carlson, a lobbyist for the League of Minnesota Cities.

City hopes for bonding projects

The state Legislature usually borrows money through bonding on even-numbered years in order to fund capital improvement projects across the state.

Dayton, however, has proposed a $1 billion bonding bill this year and has already outlined half of the projects while allowing the Legislature to propose the other half.

Dayton included three of Minneapolis’s most coveted projects, according to their ranking on the city’s legislative agenda.

Dayton’s proposed projects in Minneapolis include:
— $7 million to repair the Plymouth Avenue Bridge;
— $6.5 million for improvements to the Target Center; and
— $5.3 million to construct Granary Road in Southeast Minneapolis’s Industrial Area
— Republican legislators, however, have indicated they don’t want a bonding bill this year.

Pension relief

In an effort to continue to pay out pensions to retired city police and firefighters without putting a heavy burden on taxpayers, the city is asking the state to merge those two pension plans into the state’s Public Employees Retirement Fund by the end of 2012.

Giving cities back their variance authority

Carlson said the Minnesota Supreme Court last year made a ruling that takes away power from cities to grant variances to property owners who want to do things like build additions on their homes or businesses.

This, Carlson said, is hurting the remodeling industry. Glidden said this is a new issue for Minneapolis and provides a good example of how cities can work together to get a bill introduced, though some business groups oppose it.

“It has created a lot of problems for our members,” Carlson said. “We have a bill introduced and it’s kind of sitting there waiting for action.”

Reach Nick Halter at [email protected]

Local Government Aid: By the numbers

The state has cut LGA to Minneapolis by $290 million since 2002, including $54 million in the past three years.

In 2003, the Minneapolis General fund was comprised of 40 percent state aids and 29 percent property taxes.

In 2010, state aids only made up 23 percent of the General Fund, and property taxes made up 43 percent of the fund.

In 2001, Minneapolis homeowners paid 33 percent of all city property taxes collected.

Because of changes in state law, Minneapolis homeowners will pay 56 percent of all city property taxes collected in 2011.

City spending is down 12 percent since 2000, after adjusting for inflation

The cost to provide public safety in Minneapolis ($195  million), is more than the city collects in property taxes ($168 million).

Minneapolis has 10 percent fewer full-time positions than a decade ago.

Source: city of Minneapolis