Political Notebook

Suburbs vs. Greater Minnesota?

A group of 16 Twin Cities suburbs have banded together arguing that their residents are the ones shouldering the greatest property tax burden — not residents in Greater Minnesota. The Municipal Legislative Commission has launched a new website called PropertyTaxFairness.com that says a recent report by the Minnesota Department of Revenue found that Twin Cities metro area homeowners paid a 39 percent higher share of their income to property taxes than their Greater Minnesota counterpart.

The group is also urging residents in these cities to contact their lawmakers to make sure that any changes to the property tax system do not disproportionately hurt suburban taxpayers.

This push comes as lawmakers are considering steep cuts in Local Government Aid to cities. The Coalition of Greater Minnesota Cities has been vocal in its opposition to these cuts with their own website, ThankLGA.org. A House Republican proposal initial called for deep cuts in aid to Twin Cities suburbs, but later backed off that proposal. The GOP-backed House Tax Bill would phase out LGA for Minneapolis, St. Paul and Duluth, all cities of the first class, by 2015. It's important to note that Rochester officially became a city of the first class in the wake of the recent 2010 census, but it would be excluded from those cuts. And both Republicans and Democrats do not seem eager to bring up any efforts to include the Med City, a swing district that both the GOP and DFLers are eagerly courting. Democrats did not offer any amendment to add Rochester to the list of first-class cities getting cut.

The Senate Tax bill does not single out the three cities. Lawmakers are working to reach a compromise tax bill.

Representatives from Greater Minnesota have been vocal in their opposition to any cuts in Local Government Aid. Most notably, the Albert Lea Chamber of Commerce has been very vocal in their concerns about cuts to LGA and successfully pressured Rep. Rich Murray, R-Albert Lea, to vote against bills that would cut aid.

 

 

Is Rochester off the hook when it comes to big LGA cuts?

The Minnesota House Property Tax bill includes steep cuts in Local Government Aid for cities of the first class. Those are cities that have at least at one time had a population of at least 100,000.  With Rochester expected to be officially designated a city of the first class when the latest Census data arrives, it would appear Rochester would join the fate of Minneapolis, St. Paul and Duluth when it comes to these cuts.

But not so. Look carefully at the bill language and the reductions only apply to cities of the first class as of 2009. So it looks like Rochester would be spared. It is important to note that Minneapolis, St. Paul and Duluth are all DFL strongholds while Rochester is a swing district that is represented by GOP and DFL lawmakers.

The bill includes $300 million in cuts to LGA and would phase out aid to cities of the first class (excluding Rochester) beginning in Fiscal Year 2015. It would also phase out aid for suburban metro cities by the end of the upcoming two-year budget cycle.

Of course, this is just the House proposal and DFL Gov. Mark Dayton has made clear he does not support deep cuts to LGA. Still, interesting to see that the GOP-controlled House appears to be trying to spare Rochester in its proposal.

(H/T Rachel Stassen Berger Star Tribune)

 

DFLers head to Roch to make case that LGA cuts = property tax hikes

As the budget battle continues to brew in St. Paul, DFL Gov. Mark Dayton has continued to argue that cuts to Local Government Aid will translate into higher local property taxes. Now Democrats will take that message to Rochester on Sunday at a "Revenue Reality Check Roundtable."

The event will feature local officials talking about how state aid cuts would impact property taxes. Democrats planning to attend are Rochester Rep. Kim Norton, Rochester Rep. Tina Liebling, House Minority Leader Paul Thissen and former House Tax Committee Chair Ann Lenczewski.

The roundtable will run from 2:30 p.m. to 3:30 p.m. at the Heintz Center at Rochester Community and Technical College.

Republicans argue that it is unfair to directly link state aid cuts to property tax increases. They say it is ultimately up to local officials to decide whether they are going to raise property taxes.

Mayors push for candidates to take stand on LGA

The Coalition of Greater Minnesota Cities today announced a campaign aimed at urging voters to ask gubernatorial candidates whether they support Local Government Aid. As part of that announcement, they unveiled a two-minute video that states cities have lost $782 million in LGA since 2003 and that Minnesota property taxes have gone up 64 percent.

The coalition also takes aim at Republican Gov. Tim Pawlenty. It features a video of him when he was running for governor in 2002. In the video, Pawlenty says, "You can't run around the state and say I'm not going to increase taxes and then cut LGA in a way that drives up local property taxes."

While Pawlenty makes these comments, a chart shows the cuts in LGA and the rising property taxes.

Austin Mayor Tom Stiehm is also featured in the video. He talks about the impact of state aid cuts on Austin's public safety.

"We're down one police officer already," he said. "We are anticipating another police officer going in August."

Pawlenty's spokesman Alex Carey offered this reaction to the coalition's campaign.

“During these difficult economic times, cities need to streamline and become more efficient, and not turn reflexively to local property tax increases. For 2009, Governor Pawlenty capped the cut in LGA payments to cities at 3.3 percent. Cities should be able to find ways to manage a small reduction to their revenues, just like families and businesses are doing, without massively hiking local property taxes.”

To watch the video, go here.