When emergency situations arise, you learn quickly who can be relied on for help. As mayors of cities that have been hit by disasters including tornados and floods, we know that we can count on Minneapolis and Saint Paul for assistance – unless the House majority succeeds in marginalizing the state’s two biggest cities.
The rationale for this is beyond our comprehension, but the House tax bill slashes the amount of Local Government Aid going to the Twin Cities by 43 percent this year and completely phases it out by 2014. The bill also includes LGA cuts that will hurt other cities in the state, but we don’t think it is right to double-down on Minneapolis and Saint Paul. Those are one-two punches that will cripple our largest cities and put the whole state’s economy at risk.
After a tough two or three years, the economy is starting to gain momentum again, so this should be the time to stimulate, not stifle, the cities that help power our state’s economy. Minnesota’s strength lies in its diversity and in its economic interconnectedness, and those of us active in city governments in greater Minnesota understand the benefits that Minneapolis and Saint Paul provide to our communities. Likewise, the mayors of the Twin Cities understand that if the whole state isn’t healthy, their communities will not do well, so it is hard to understand why the legislature is turning a blind eye to that fact.
When Representative Linda Runbeck, chair of the House Property Tax Division and former president of the Taxpayers League of Minnesota was asked during a committee hearing what her rationale was for cuts to the LGA program, her answer was sobering and should put a scare in all home and business owners in cities that receive LGA. Runbeck said, “What this is aiming to do is to begin the phase out of LGA…. so we are looking to those that have the strongest tax bases, that can live off of their tax bases, have had great growth, have great vibrancy, and in a solid metro retail area and that’s where the phase out is beginning.”
This confirmed our suspicion that for some legislators the motivation to zero out the Twin Cities was the first step in completely doing away with the LGA program and had little or nothing to do with policy. Runbeck stated that the reason for starting the phase out with first class cities is because they have the strongest tax bases, but that is incorrect. There are 98 cities receiving LGA that have stronger tax bases per person than Saint Paul and 64 with stronger tax bases than Minneapolis, so that nullifies her argument.
Local Government Aid has served the state well for the past 40 years, and these efforts to dismantle the program, starting with the Twin Cities, will undermine the state’s economic base. Minneapolis and Saint Paul weren’t the welcoming and income producing communities they now are before a combination of urban and rural, liberal and conservative legislators worked together to enact the LGA program. Cities in greater Minnesota would also look different without local aid. The vibrancy, economic health and many of the jobs and businesses located in rural cities would be missing.
Page 2 of 2 -
Even though the House has passed its tax bill, there is still a long time to go before the session is over and final decisions are made. We hope House members and the legislature as a whole will continue to reflect on their actions and change their minds about reversing a policy that has led to an economically strong state.
Wolden is mayor of Wadena and Smiglewski is mayor of Granite Falls.