With the governor vetoing a legislative budget plan that would have protected LGA and Market Value Credit (MVC) from further funding cuts in 2010, the legislature will look for ways to redraft their plan in a way that will generate more support from the executive branch. Prior to last week’s unallotment ruling, the governor released a proposal for closing the state’s budget gap in light of delayed federal funding; this plan included an additional $87.5 to $102 million reduction in LGA and MVC for 2010 (an exact cut amount is unknown due to the uncertainty of how cities and counties would split the overall proposed cut to property tax aids and credits). The graph below shows that a cut on the low end of this range—on top of the governor’s 2010 unallotments to LGA and MVC and the legislature’s supplemental cut—would amount to an overall 43% reduction of LGA and MVC in this year alone. Even without the governor’s proposed supplemental cut, LGA and MVC have been reduced 29% in 2010 through unallotment and legislative action.
These figures beg the question: At what point will cities have played their fair role in helping the state balance its budget? While the state continues to shift its budget problems down to the local level, communities are losing cops, firefighters, library hours, and parks, and property taxpayers are footing an increasing bill for fewer services. Cuts to cities have been disproportionately deep compared to the sacrifices asked of other programs—not because cutting cities is good policy, but because it prolongs the state from making the tough choices necessary for confronting its long-term structural problems. As the legislature crafts a new plan for closing the state’s budget gap, they must acknowledge that excessive cuts to LGA and MVC are dismantling communities across the state and that it’s time to protect these programs from further reductions.