After launching a statewide effort to elevate Local Government Aid as a campaign issue for the 2010 governor's race, a reporter recently asked us why -- after having endured year after year of cuts to LGA in the last decade -- are we putting up a fight now.
Quite simply, we've had enough. We've had enough of the job losses in our communities. We've had enough of the property tax increases. We've had enough of the disproportionate target on the back of greater Minnesota. And we think all regions of Minnesota -- from the rural cities to the suburbs to the metro cities -- deserve better.
The state's own Office of Management and Budget projects a $4.4 billion deficit in the next biennium, prompting many candidates to sound the job creation and economic development horn as a cure-all to the state's budget woes. We absolutely agree that it is time to put Minnesotans back to work, but leaving LGA and greater Minnesota out of the economic recovery discussion is like building a new house on a cracked foundation.
Minnesota needs LGA and a strong greater Minnesota to secure the economic stability of the entire state. It's true that greater Minnesota receives 65 percent of the total LGA allocation and that some metro suburbs with high property wealth don't receive any of these dollars, but that doesn't mean residents in non-LGA receiving cities don't benefit economically from the program. In fact, the opposite is true.
If greater Minnesota can't keep its property taxes competitive and provide an expected level of critical services -- such as public safety, emergency response units, road maintenance, and adequate sewer and water infrastructure -- businesses will simply close up shop and leave the state, and new businesses will bypass Minnesota all together.
That means more Minnesotans will be out of work, small local businesses will see their business decline, and less income tax revenue will flow through the state's coffers. This will negatively impact the services we all rely on, such as K-12 education, hospitals and safe highways and bridges.
After repeated cuts to LGA, this is the current trajectory Minnesota is on and it's not right. Since 2002, LGA has been cut $782 million, and city property taxes have increased 64 percent as a result. In 2010 alone, cities stand to lose up to 7.64 percent of their budgets through state aid cuts. To reduce operating costs and curb the growth of property taxes, cities have cut their workforces by 6 percent since 2003, adding more unemployed Minnesotans to compete for fewer and fewer jobs. And because greater Minnesota receives the majority of the state's LGA dollars, our cities, residents, and businesses are bearing the brunt of the storm.
Mayors in greater Minnesota are turning up the volume on LGA not because we think the program should be immune from state budget cuts -- we have been vocal in supporting a proportional cut relative to other programs -- but because the state can't continue down this road and expect economic recovery to just "happen" fortuitously. The state needs to pursue both strategic reform and investments in all corners of the state.
As candidates hit the campaign trail and explain their vision for the state, Minnesotans need to know where they stand on LGA. Will they support a city's ability to attract and retain jobs, or will they fail to see the big picture on the state's economic recovery? It's time for Minnesotans to get some answers.
Tim Strand is mayor of St. Peter and president of the Coalition of Greater Minnesota Cities. Nancy Carroll is mayor of Park Rapids and coalition board member.