LGA makes sure all cities
in state serve their residents
Wednesday, March 23, 2011 5:34 AM
In recent years, cuts to Local Government Aid (LGA) have been a fact of life for area cities. For example, Harmony received $370,142 in LGA in 2007, but cuts over the past few years meant a payment of just $320,299 in 2010, according to the Minnesota House Research Department. The cuts were often last minute decisions to help balance shortfalls in the state budget.
In 2011, the state is facing a $5 billion budget deficit and, rather than more emergency cuts in LGA to help fix short-term problems, the Legislature is looking at the philosophical merits of the entire LGA system. There is consideration by one House committee calling for elimination of the program by 2014.
There is a trend, sparked by the Tea Party movement, to force the removal of government support for individuals, making them more self-reliant and less dependent on public subsidies. That philosophy is carrying over to the debate on LGA as the argument against LGA is that it is welfare for cities, which should pay for their services from taxes generated locally without the supplemental funding from the state.
Budget deficits mean some tough decisions and every constituency that sees a potential loss is going to complain. However, LGA is something that, even for people living in Bloomington or some other city that doesn't need LGA, makes the entire state stronger and more secure.
For local cities, the loss of LGA would truly be devastating as the state funding makes up more than half of the budgets for many municipalities in the area. The state funding doesn't lead to extravagant spending by cities in our area. Instead, the LGA is enabling services that are expected by residents no matter where they live.
To cope with the previous cuts in LGA, cities have had to cut or reduce hours of personnel, cut back or eliminate service and postpone annual maintenance, which is showing up as potholes or cracks in streets. There has also been discussion of closing swimming pools, delaying purchases of large equipment, even fire trucks, reducing police protection and taking on other cost-cutting measures to key services.
City officials are nervously watching action at the Legislature, predicting dire consequences even if LGA is just cut. Elimination of the program would be disastrous.
Some cities in Minnesota have had no consequences to the reduction in LGA because they don't rely on LGA for services. They have a strong base of property tax to fund their cities. However, there is nothing like a Bloomington, with its Mall of America, in our rural area, so cities here use LGA to provide what are considered basic services to our residents.
LGA was created in 1971 as a property tax relief program in the Minnesota Miracle, a series of legislative reforms that changed the way government was financed in the state. That miracle, which more radically changed the way education is funded in the state, uses sales and income taxes raised in Minnesota to reduce property taxes and take pressure off local governments that have less revenue to provide for the needs of its citizens.
There have been minor reforms in the Minnesota Miracle over the years to more specifically target cities based on their financial needs. Those with lower property tax bases receive more LGA.
The opponents of LGA argue that property taxes only are a better way to fund services than redistributing funds taken in by the state. Their philosophy is that local people should pay for local services. If they need more money for services, raise property taxes, or, possibly, increase local sales taxes if the state laws change to allow this.
However, the question is whether Minnesota should become a state of have and have-not communities? Isn't Minnesota one big family where every citizen deserves to live in a community where basic needs are met by local services?
Police and fire protection, maintenance of roads, public parks, planning and zoning, functional wastewater treatment, clean drinking water, programs for youth and recreational opportunities are essential for healthy communities no matter where they are located in Minnesota. The word "right" has taken on a too comprehensive meaning, but citizens should at least have, if not the right, the opportunity to live in a community where basic services are met.
Although the program may smack of wealth redistribution, legislators representing wealthy communities that don't need LGA shouldn't look to balance the budget at the expense of poorer communities. The concept of self-reliance for individuals doesn't necessarily transfer over to communities, as there are many complex factors involved in making sure essential needs are available to residents of various communities.
LGA, as designed through the Minnesota Miracle, makes the entire state more secure, even if some communities benefit more than others. We all need to contribute our fair share to ensure the success of all communities in Minnesota.
No city is an island and the Legislature shouldn't try to reverse that condition by taking away the connections that bind all of us together.