Posts Tagged ‘Local Government Aid’

State Aids: The Shrinking Slice of the City Revenue Pie

City property taxes have increased significantly in recent decades. Even after adjusting for inflation and population growth, the property taxes collected by Minnesota cities have increased by 48% from 1990 to 2018. However, real (i.e., inflation-adjusted) per capita city revenues are down over the same period. The rapid growth in property taxes and the decline…

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2018 Local Government Aid Funding in Perspective

Local Government Aid (LGA) has long been an important source of funding for city services and property tax relief. A 2018 LGA funding hike provided valuable new resources to cities, but not quite enough to keep pace with inflation and population growth from 2017 to 2018. Today total real (i.e., inflation-adjusted) per capita (per person)…

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City LGA Differences Among Various Plans

Governor Dayton’s city Local Government Aid (LGA) proposal increases the LGA appropriation in the upcoming two year budget, while the House freezes the appropriation and the Senate cuts it, as noted in the preceding North Star article. Knowledge of the appropriation alone, however, does not tell us how much aid individual cities will receive. In…

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City Aid Declines Under Most LGA Proposals

For the last four and a half decades, the city Local Government Aid (LGA) program has helped cities fund essential services and control property tax levels, but in real (i.e., inflation-adjusted) dollars per capita, city LGA is currently less than half of what it was in its peak year of 1990 and about 20 percent…

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City & District Info on Potential Special Session LGA

Last week, North Star discussed potential outcomes in regard to city Local Government Aid (LGA) if there is and if there is not a 2016 special session. If there is no special session, city LGA in 2017 will be distributed under current law. For most cities, this will translate into a tiny aid increase in…

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Local Government Aid During a Potential Special Session

An August North Star article described the main effect of no 2016 special session: a larger state budget reserve. The same article noted some of the likely effects if there is a special session, including “an increase in state assistance to local governments.” With renewed discussions among the Governor and legislative leaders regarding a special…

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City LGA: A Shrinking Slice of the Budget Pie

Local Government Aid (LGA) has been a mainstay of city finances since its inception in 1972. In fact, many small, low tax base communities receive more in LGA than they collect in property taxes. That being the case, LGA is a perennial hot topic at the state capitol. A recent North Star article demonstrated that…

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A Brief History of LGA

For four and a half decades, the Local Government Aid (LGA) program has provided assistance to Minnesota cities to pay for essential services and infrastructure and to help hold down property taxes. In recent years, some state policymakers have attempted to increase funding for LGA, while others have said it is time to phase-out the…

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Executive Summary: Minnesota's Budget Surplus

The conservative effort to use the entire budget surplus to reduce state taxes—often referred to as the “give it back” campaign—is based on the premise that state revenues and expenditures have increased dramatically and thus all legitimate state expenditure needs should already be sated. However, a closer look at total state general fund revenue and…

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Minnesota's Budget Surplus: Balancing Tax Cuts and Investments

I. Introduction Last March, a group of legislators gathered at the State Capitol with a simple message: “Give it back!” The “it” refers to the state budget surplus, then projected to be nearly two billion dollars for the upcoming fiscal year (FY) 2016-17 biennium. These legislators urged Governor Dayton and their House and Senate colleagues…

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