There are only five weeks left in the 2018 legislative session and the Minnesota Senate has yet to hold a hearing on SF 3082, the CGMC-supported bill to increase LGA funding by $30.5 million to help cities keep up with rising costs and hold down property taxes. The House companion bill, HF 3493, received a committee hearing last week, but so far the Senate has ignored LGA by not hearing any bills that would increase it. It’s time to tell the Senate to step up!
Take action now!
Contact your senator, Senate Tax Committee Chair Roger Chamberlain and Senate Majority Leader Paul Gazelka as soon as possible and urge them to hold a hearing on SF 3082 and increase LGA funding this session.
Tell them that:
- Any meaningful tax bill must include an increase in LGA—the most effective tool the state has for building strong communities in Greater Minnesota.
- You and your community are counting on the Legislature to pass a $30.5 million LGA increase this session to finally restore the program to its 2002 level.
- Last year’s $15 million LGA increase was helpful in allowing many cities to hold down property tax levies and address long-delayed investments. However, the cost to cities to provide services continues to rise due to inflation and other factors.
- Tell your story of the impact LGA has on your community! Share examples of how your city uses its LGA and how your city might utilize an increase.
- Find your senator’s contact information in the Senate Member Directory or by visiting Who Represents Me?
- Contact Senate Tax Committee Chair Roger Chamberlain at firstname.lastname@example.org or (651) 296-4197
- Contact Senate Majority Leader Paul Gazelka at email@example.com or (651) 296-4875.
If you have any questions about LGA or the legislative session, please contact Bradley Peterson at firstname.lastname@example.org or 651-259-1911.
As has become recent tradition for the CGMC, we will be holding an end-of-session lobby day and ice cream social to make a final push for our top priorities in the waning days of the legislative session. The event, which will be held in St. Paul on Wednesday, May 9, will give Greater Minnesota city officials and other community leaders a chance to meet with legislators and demand that they pass bills that address CGMC priorities such as LGA, wastewater infrastructure and child care.
The tentative schedule for the day is as follows:
- 10:30 a.m. – Legislative update and messaging (Room 500 North in the State Office Building, located across the street from the State Capitol)
- Afternoon – Meetings with legislators (attendees should make appointments with their own legislators; we may also ask some attendees to participate in additional meetings with key legislators)
- 2-3 p.m. – Ice cream social with legislators and legislative staff (L’etoile du Nord Vault Room in the Basement of the State Capitol)
Lobby Day is FREE to attend, but we ask that you register at greatermncities.org/IceCream2018 by Monday, May 7 so that we can coordinate meetings. Free parking is available at the Flaherty & Hood office located at 525 Park St. in St. Paul, just one block from the State Capitol, as long as you print off this parking pass (which is good only for May 9) and put it on your dashboard.
We hope to get as many city officials to attend as possible! Please share this Lobby Day Flyer and encourage other city officials and staff to join us. If you have any questions, please contact Julie Liew at email@example.com or 651-259-1917.
CGMC city leaders to Legislature: State must take action on clean water funding crisis
High infrastructure costs could cripple rural communities unless state steps in
ST. PAUL—With cities across the state facing billions of dollars in costs to upgrade wastewater infrastructure to replace aging equipment and comply with new regulations, city leaders held a press conference today to call on the state to play a larger role in tackling Minnesota’s clean water funding crisis.
“I don’t use the word ‘crisis’ lightly, but that is exactly what towns across Minnesota are facing right now,” said Lakefield City Clerk Kelly Rasche. “Extremely high water infrastructure costs will cripple our communities unless the state ups its game and provides more funding.”
Rasche and other city leaders with the Coalition of Greater Minnesota Cities (CGMC) joined together at the press conference to ask the Legislature to support two bills that aim to address the massive expenses being piled on cities to repair or replace their water treatment facilities.
The first bill, SF 2668/HF 3122, authored by Sen. Gary Dahms (R-Redwood Falls) and Rep. Dean Urdahl (R-Grove City), allocates $167 million in state bonding for three key grant and loan programs administered by the Public Facilities Authority (PFA).
However, city officials say that caps and limitations on the PFA funding programs mean that they are no longer sufficient to meet the needs of communities across the state. Moreover, the growing need equates to more cities vying for the limited pool of state dollars. More than 300 cities are currently planning for upcoming water infrastructure projects, while the Minnesota Pollution Control Agency estimates it will cost $5 billion statewide over the next 20 years to pay for wastewater infrastructure alone.
That is why the CGMC is also spearheading efforts on a second bill, SF 3075/HF 3332, authored by Sen. Torrey Westrom (R-Elbow Lake) and Rep. Urdahl, that would provide supplemental grant funding to increase the state’s share of the costs for wastewater infrastructure.
“The current bonding proposal for $167 million is a good start, but with hundreds of cities seeking funding, it’s not going to go very far,” said Glencoe City Administrator Mark Larson. “Clean water is a state and local responsibility, but right now too much of the burden is falling on city residents and businesses.”
The city of Glencoe is facing $22.3 million in costs to replace portions of its facility that are more than 50 years old, adhere to new pollution discharge limits, build a new lift station and other upgrades. Under the current grant programs, the city only qualifies for approximately $5.5 million in state funding, which means the city and its ratepayers will be on the hook for the rest of the project costs unless the state steps up with more money.
Lakefield, a small city with a population of 1,691, is also bracing for potentially massive rate increases to pay for a $22 million upgrade to its wastewater system in order to comply with new permit requirements. According to Rasche, the city’s average residential water and sewer rates would have to nearly double to $190 a month to cover this cost without financial assistance from the state.
“Our rates are already higher than most other cities,” Rasche said. “The potential increases are so high that we are concerned people won’t want to live in our town. How do they expect our small cities to survive?”
While cities across the state have water infrastructure needs, those in the metro area are able to keep rates down because of the lower cost of serving a highly concentrated population. This is not an option for most Greater Minnesota communities.
For example, Albert Lea needs to undergo a project that is estimated to cost $72.5 million. Without state help, the city’s wastewater rates would have to nearly triple to an average of $1,082 a year. In contrast, the average annual residential rate in the metro area is only $274.
“These costs are hitting Greater Minnesota cities especially hard,” said Albert Lea City Manager Chad Adams. “That is why we need a benchmark, a limit to how much local businesses and homeowners can reasonably be expected to pay.”
The CGMC’s supplemental grant bill (SF 3075/HF3332) would set that benchmark by either limiting the local costs for wastewater treatment to 50 percent of the total project costs or by limiting the local wastewater rates to no more than double the average annual costs in the metro area. Cities would receive additional state funding based on the option that results in a greater amount.
“Yes, it is going to be expensive for the state to provide additional funding. But if it’s too expensive for the state, it’s definitely too expensive for our small communities,” Rasche said. “This is a wake-up call to our legislators to let them know that our cities need their help and we need it now.”
Coalition of Greater Minnesota Cities
Contact: Julie Liew
As cities across Minnesota face billions of dollars in wastewater infrastructure costs, rural communities simply cannot afford to upgrade or rebuild aging facilities without additional financial assistance from the state
Who: Kelly Rasche, Lakefield city clerk; Chad Adams, Albert Lea city manager; Mark Larson, Glencoe city administrator; Bradley Peterson, CGMC executive director, and other Greater Minnesota city leaders
What: Press conference about the need for a bonding bill that addresses wastewater infrastructure costs in Greater Minnesota
When: 1:30 p.m., Wednesday, April 11, 2018
Where: Press Conference Room B971, Minnesota State Capitol
Members of the House of Representatives are advancing a bill that would penalize cities that receive LGA and also collect a Local Option Sales Tax. HF 3830, chief authored by Rep. Cal Bahr (R-East Bethel), would reduce a city’s LGA by the amount of funds that it collects under a Local Option Sales Tax approved by the city’s voters and authorized by the Legislature.
This bill will be heard on Wednesday, April 11 by the House Property Tax and Local Government Finance Division, chaired by Rep. Steve Drazkowski. We need your voice to push back against this dangerous bill!
Take action today!
It is critical that CGMC city leaders call or e-mail bill author Rep. Cal Bahr and Committee Chair Rep. Steve Drazkowski, as well as Speaker of the House Kurt Daudt and your own House member. Tell them to oppose HF 3830.
Let them know that:
- This bill harms rural Minnesota, where the majority of cities that collect local sales taxes are located.
- Local Option Sales Taxes are approved by voters and can only be spent on specific purposes that are authorized by the Legislature. They do not go to fund a city’s general operations or to provide services like fire, police or parks like LGA does.
- This bill’s LGA cuts would directly result in property tax increases or cuts to city services.
- The bill disproportionately punishes cities that need LGA the most. Wealthy cities that receive little or no LGA could continue to collect a Local Option Sales Tax without the same consequences.
- Bill author Cal Bahr: firstname.lastname@example.org, 651-296-2439
- Committee Chair Steve Drazkowski: email@example.com, 651-296-2273
- House Speaker Kurt Daudt: firstname.lastname@example.org, 651-296-5364 or 800-710-7642
- Contact your own House member: Who Represents Me?
For more legislators’ contact information, visit:
With the Legislature on break this week, things are a little quiet in St. Paul. Nonetheless, when the legislators return Monday they will face a torrent of issues and decisions before the Legislature adjourns in mid-May.
Among the tasks for the Legislature and Governor: dealing with changes to Minnesota’s tax system in response to the federal tax reform, cobbling together a bonding bill that meets Minnesota’s infrastructure needs, and putting together a supplemental budget. Wrapped up in all of this is also whether the Legislature will storm ahead and put a constitutional amendment on the ballot to permanently dedicate the revenue attributable to the sales tax on auto parts to transportation purposes, which would divert those funds away from their current general fund uses.
This leaves many of the CGMC’s priorities yet to be determined. An LGA increase, funding for water and wastewater infrastructure, the Greater Minnesota Business Development Infrastructure (BDPI) grant program, and funding for childcare initiatives are all still in play. Expect the volume of activity to intensify in these final weeks of session. As always, look to your CGMC team for the latest developments on these and other issues impacting Greater Minnesota cities.
The 2018 CGMC Labor & Employee Relations Seminars will be held Thursday, June 7 in Albert Lea and Thursday, June 14 in Detroit Lakes. Each seminar is from 10 a.m. to 4 p.m., with registration beginning at 9:30 a.m. Please register today as space is limited! You can register at greatermncities.org/2018laborseminars. More details on the agenda and venue information can be found here.
The seminars are focused on practical and legal solutions for providing services and managing employees in local government. They will provide relevant and timely advice on the following topics (and more!):
- Understanding fire department’s unique organizational and personnel issues
- How to organize and communicate personnel data the right way
- Health insurance legal and marketplace update
- Settlement, interest arbitration, and Legislative update
- Brenda Cossette’s mock negotiations
We hope all units of government will send representatives (e.g., managers and administrators, human resources personnel and elected officials) to this valuable program. Feel free to forward this information to interested persons in your unit of government or other units of government. Both CGMC members and non-members are welcome to attend.
For more information, contact Karina Patino at (651) 259-1919 or email@example.com.
Two recently introduced bills seek to reduce – or eliminate – Local Government Aid (LGA) based on sales tax revenue. The first, HF 3830 (authored by Rep. Cal Bahr, R-East Bethel) reduces a city’s LGA over time based on their local sales tax. As cities know, local option sales taxes are not a substitute for LGA since they are dedicated to specific capital projects, while LGA is used for general operations, investments and restraining property taxes.
The second LGA bill, HF3892/SF 3518 (authored by Rep. Jerry Hertaus, R-Greenfield and Sen. Mark Koran, R-North Branch), would eliminate the LGA and fiscal disparity program and re-direct sales taxes to cities and school districts. Specifically, the revenue raised by a sales tax of 1 percent on all sales goes to a new school/municipal trust account. Every city qualifies for aid, but a city’s aid would be determined by a county’s share (the amount needed to make payments multiplied by how much sales tax revenue the county contributes) multiplied by the city’s population. The higher the population and sales tax revenue, the more aid a city would receive – more than likely benefiting populous metro cities.
The CGMC will continue to monitor these bills and others to ensure that Greater Minnesota cities can rely upon a strong LGA program into the future. If you have any questions about LGA issues, please contact Bradley Peterson at firstname.lastname@example.org.
Bill to increase city aid finds strong bipartisan support at Legislature
Mayor: LGA is the ‘unsung hero of Greater Minnesota communities’
ST. PAUL—As discussions about the projected state budget surplus and potential changes to the tax code heat up the Capitol, city leaders from Greater Minnesota are calling on lawmakers to pass legislation introduced today that would increase funding for critical state aid to cities.
The bill, SF 3082/HF 3493, boosts funding for the state’s Local Government Aid (LGA) program by $30.5 million. Chief authored by Sen. Bill Weber (R-Luverne) and Rep. Paul Anderson (R-Starbuck), two long-time advocates for LGA, the legislation has bipartisan support in both houses and a long list of Republican and Democrat co-authors who represent a wide mix of rural, suburban and urban cities.
“Sen. Weber and Rep. Anderson are veteran legislators and great champions for Greater Minnesota. We are grateful they are taking the lead on this issue and continuing to fight on behalf of the nearly 90 percent of Minnesota cities who receive LGA,” said Dave Smiglewski, mayor of Granite Falls and president the Coalition of Greater Minnesota Cities (CGMC).
Securing additional LGA funding is a top legislative priority for the CGMC this session. While small increases in recent years have begun to make up for drastic cuts made to LGA in the mid-2000s, the program still receives less funding than it did in 2002. At the same time, inflation and hefty increases in costs such as employee health insurance premiums and construction materials have caused cities to struggle to provide the services and amenities residents depend on while keeping property taxes in check.
“The average Minnesotan might not know anything about LGA, but it is absolutely vital to keeping our cities strong and providing a good quality of life for our residents,” Smiglewski said. “Every time you drive down a plowed street, call emergency services or visit a city park, there is a good chance you are experiencing the benefits of LGA. It is the unsung hero of Greater Minnesota communities.”
Lawmakers have been vocal about the need to pass a tax bill in order to deal with issues that have sprung up due to the recent federal tax overhaul. Since changes to LGA funding are typically addressed in the tax bill, Smiglewski said this focus on the state’s tax situation provides an opportunity to pass an LGA increase this session.
“Our communities have waited long enough. Now that the economy is strong and Minnesota is on the right track, it is time to restore LGA funding,” Smiglewski said. “As our legislators debate tax changes and plans for the budget surplus, we are counting on them to make sure LGA is a major part of the conversation.”
The Coalition of Greater Minnesota Cities is a nonprofit, nonpartisan advocacy organization representing 96 cities outside of the Twin Cities metropolitan area. The Coalition educates legislators about issues important to Greater Minnesota. Visit the CGMC online at greatermncities.org and follow us on Twitter @greatermncities.
We thought this bill was dead last session, but now the townships are pushing it once again and we need to stop this effort before it gains momentum.
SF 1749 prohibits a city from pursuing an annexation if the potential annexation area is covered by an orderly annexation agreement with another city. On paper this may sound reasonable, but what happens in practice is that a township will often pit two cities against each other to get the best deal for the township, rather than what is best for the region’s development.
Take action now!
Contact Sen. Dan Hall, chair of Senate Local Government Committee, and tell him that your city opposes SF 1749. In addition, contact your legislators and ask them to reach out to Sen. Hall to let him know that their local cities oppose this harmful legislation.
Tell them that SF 1749 is harmful because:
- It stifles economic development, particularly in Greater Minnesota.
- It prevents cities from having a say in how they develop, and instead gives townships disproportionate leverage in negotiating orderly annexation agreements.
- It drives up the cost of local infrastructure and public services.
- It would be a stunning restriction of property owner rights:
- A landowner could be denied the right to connect with city services when building a home.
- A business owner could be denied the right to build or expand a business.
- A city may not be able to include property purchased for public purposes—such as for wastewater treatment, water supply or an industrial park—in its own boundaries.
- Visit Who Represents Me? to find contact information for your legislators.
- Call Sen. Hall at 651-296-5975 or send him an email using this email form.
If you have any questions, please contact CGMC annexation lobbyist Elizabeth Wefel at email@example.com or 651-259-1924.