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Legislature increases state aid to cities

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City officials all over Minnesota are analyzing the outcome of the just-concluded legislative session.

On the surface, cities appeared to have fared well under the 2008 legislature - at least with regard to the Local Government Aid program.

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Cities will get $42 million more in LGA under the bill. Counties, meanwhile, will get $22 million more.

New York Mills stands to pick up a little extra in Local Government Aid after the Minnesota Legislature passed a $42 million increase in LGA across the state. Governor Tim Pawlenty is expected to sign the bill into law.

New York Mills is expected to see a 9.41 percent per capita increase next year from 2008 LGA to the new law the Legislature sent to the Governor to close out the 2008 session. LGA to NY Mills in 2009 should increase by $7,769 from the $378,048 projected under the current law to $385,817 with the new law.

JOBZ, an economic development and jobs-creation program, was retained - but not extended.

Closely scrutinized by legislators, with rural lawmakers generally supporting it, JOBZ was at high risk of being altered substantially - or even gutted.

The 2008 legislature retained JOBZ incentives to year 2015.

Tax bill higlights

Minnesota legislators approved this year:

-- Increase maximum property tax refunds (via income tax returns) 27.5 percent

-- Raise Local Government Aid to cities $42 million and state payments to counties $22 million

-- Allow local governments to raise property taxes just 3.9 percent each of the next three years in most cases

-- Give cities that host major utility facilities special payments to offset lower property taxes utilities pay

-- Place a moratorium on changes of how non-profit facilities are taxed, keeping much non-profit property safe from tax

-- Lower property taxes on farm homesteads

-- Exempt from property tax the former Fergus Falls Regional Treatment Center

-- Various tax breaks for veterans and current military personnel

-- Close loophole some corporations with foreign operations used to avoid paying state taxes

-- Allow Bloomington to tax sales in the Mall of America and hotels citywide to raise money for mall expansion

-- Job Opportunity Building Zones program left intact, but some stricter audit measures enacted

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