Mayors' Panel Meets with Governor to Discuss LGA

Recommendations on LGA modifications will be included in the governor’s FY 2014-2015 budget and tax reform recommendations in January.
(Published Oct 17, 2012)

The panel of mayors appointed by Gov. Mark Dayton to make recommendations on the future of local government aid (LGA) met in St. Paul on Oct. 15 to continue the group’s discussions on potential modifications to the system and to share ideas with the governor.

The Tax Reform Advisory Group for LGA has been meeting since February to review the state/local fiscal relationship, and to discuss policy issues related to modifying the LGA formula and funding level. The recommendations of the group will likely become a piece of Gov. Dayton’s comprehensive tax reform initiative, which is tentatively scheduled to be presented to the 2013 Legislature.

Each mayor presented thoughts on the major policy goals of LGA and on their opinion on the focus for changes. One major theme focused on the need to make the LGA system more stable and predictable to allow city officials to develop and implement local budgets that include both short and longer-term local goals.

Other repeated LGA themes included acknowledging the challenge of providing municipal services to non-residents, achieving the goal of equity among cities, incenting and encouraging collaboration, and making the formula simple and understandable to city officials as well as residents. Several mayors discussed the role of local sales taxes in funding local projects while all of the mayors reiterated the importance of the LGA program as a source of revenue to fund city services.

Gov. Dayton, who introduced himself as a strong supporter of LGA and the state/local partnership, thanked the group for their thoughts and ideas as he and his staff work to develop a series of tax reform proposals for the 2013 legislative session.

The current LGA system includes data from the 2000 census and with the recent availability of updated 2010 census data, the LGA system is due for an update. In addition, the recent appropriations reductions for LGA have generated concerns among some city officials about the stability of LGA as a source of revenue to fund local services.

The advisory group is co-chaired by mayors R.T. Rybak of Minneapolis and David Kleis of St. Cloud. Other members include mayors Bruce Ahlgren, Cloquet; Dave Bartholomay, Circle Pines; Beth Baumann, South St. Paul; ReNae Bowman, Crystal; Ardell Brede, Rochester; Chris Coleman, St. Paul; Debbie Goettel, Richfield; Don Ness, Duluth; Joyce Nyhus, Buffalo Lake; Alan Oberloh, Worthington; Marlene Pospeck, Hoyt Lakes; Mary Rossing, Northfield; and Dave Smiglewski, Granite Falls.

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