Local Government Aid under attack
When in doubt, cut Local Government Aid.
That seems to be the motto of Minnesota lawmakers, who are once again looking to deal with the state's budget woes with deep LGA cuts.
Detroit Lakes will have to put off purchase of a much-needed plow truck for the street department and delay other equipment purchases to make up for the $260,000 it would lose under the proposal, according to City Administrator Bob Louiseau.
"If we are cut, we'll have to go through our capital improvements budget and determine what we can do there," he said.
The new truck is needed to replace an aging truck that is beginning to rack up a lot of repair costs. The truck purchase has already been delayed several years, he said.
Also, the city has grown and requires more equipment, he added.
It's important to sealcoat streets within three years of construction to keep out water that will damage the new pavement, he said.
The city may have to look at borrowing money to get the work done and assessing residents for the cost of the bond -- something it has never had to do in the past, he said.
Louiseau gets angry when he hears legislators talk about supposedly wasteful spending by Minnesota cities.
"If someone at the Legislature wants to tell you that trucks aren't necessary to plow streets -- I'd love to have them come up so we can show them."
The legislative proposal would reduce payments to cities by $460 million over the two-year budget that starts in July.
Detroit Lakes is certified to receive $986,000 in LGA this year. The proposed cut would come out of that amount.
Republicans also said they want $200 million cut in the budget ending June 30.
Rep. Mary Liz Holberg, R-Lakeville, chairwoman of the House Ways and Means Committee, and other GOP leaders said the $200 million figure is "soft" and they have not talked to Minnesota Management and Budget, the agency controlling state spending.
The bill, which could pass the Legislature next week, tells the agency to find $200 million in savings. Republicans say it begins the task of eliminating a projected $6.2 billion deficit in the next budget.
Beyond the current budget, the bill makes permanent about $840 million of cuts then-Gov. Tim Pawlenty made to balance the current budget. Lawmakers could change the numbers during this session.
While Republicans said cuts shouldn't surprise city leaders, the Coalition of Greater Minnesota Cities president was not happy.
"Released just two weeks into the session, this proposal shortchanges the over 50 new legislators from learning more about the state budget, LGA and this proposals' impacts on their communities," Park Rapids Mayor Nancy Carroll said.
The GOP plan also trims higher education spending $185 million and health and human services budgets $72 million.
According to the League of Minnesota Cities, the following communities stand to lose the following amounts in Local Government Aid in 2011 if a bill introduced Tuesday in the state Legislature is approved:
Fergus Falls, $575,724.
While many smaller cities would be held harmless under the bill, others would not.
Battle Lake would lose $37,000 of its $76,000 certified allotment for 2011, for example. And Frazee would lose $50,000 of its $477,000.
But most area cities would not be affected.
Lake Park would not lose any of its $231,000. Audubon would not lose any of its $98,500 and Callaway would keep its entire $34,000.
Ogema would not lose any of its $26,000. Vergas would keep its $30,000, and Waubun would keep its entire $93,500.
Officials from cities that would suffer cuts said Tuesday that they are holding out hope that actual amounts will be much lower when lawmakers make final budget decisions later this year.
"There was a compact made with the people of our state, that LGA would go to reduce property taxes," Louiseau said. That should be honored, he said.
If the cuts continue, Detroit Lakes will have to decide if it can continue its existing level of services, he said.
"Either we reduce services or we increase property taxes ... we'll try to get longer life out of our equipment, but eventually the cost of maintenance is self-defeating. We've cut staff, it's kind of unfair to give the remaining workers a shovel with a broken handle and say 'here, do three times the work.'"
(Forum Communications writer Don Davis contributed to this story)