Category archives
LGA

After blowing past their own self-imposed deadlines, Governor Walz and legislative leaders House Speaker Melissa Hortman and Senate Majority Leader Paul Gazelka finally reached an agreement on the state budget Sunday evening. See their signed agreement.

Although Monday was the final day of the regular session — per the State Constitution — a special session will be required for the Legislature to complete its work and pass bills. Governor Walz and legislative leaders have indicated preference for a one-day special session to be held this Thursday, but the exact timing and duration of the special session are still up in the air.

As all three stated during their joint press conference Sunday evening, the agreement reflects a compromise on all sides with no clear “winner.” The two major sticking points in negotiations were the gas tax (Governor and House wanted a 20 cent increase; Senate wanted no increase) and health care provider tax (Governor and House wanted to extend the 2% provider tax set to sunset this year; Senate wanted to eliminate it). Ultimately, the final agreement included no gas tax increase and a 1.8% provider tax with no sunset.

While there is an agreement on the broad budget numbers, the various conference committees were tasked with hammering out the details by 5 p.m. Monday. Reportedly most of them failed to meet that deadline. There is talk that now the bills will be pulled out of conference committee and the final details will be decided between Governor Walz, legislative leaders and the respective committee chairs.

What does it all mean for Local Government Aid (LGA)?

The prospects for an LGA increase — which, if there is one, will be included in the tax bill — are still up in the air.

The tax bill agreement includes only three specific items: a reduction in the second-tier individual income tax rate from 7.2 percent to 6.8 percent, $20 million for the Minneapolis Employees Retirement Fund and a $50 million reduction in the state general levy, which is a statewide property tax that primarily applies to commercial-industrial property. All other issues were left up the conference committee to decide.

The tax bill was given a $0 target, which means that any increase in tax revenues must be matched by an equivalent reduction in revenues or increase in tax aids and credits (e.g. LGA). Federal conformity, Minnesota’s response to the 2017 federal tax overhaul, will play a significant role in shaping what a final tax bill looks like as the plans put forth by Governor Walz, the House DFL and the Senate GOP all generate additional revenue that could be used to pay for other priorities within the tax bill, such as increases to LGA or an expansion of the Working Family Credit.

After the budget agreement was announced Sunday night, we quickly sent out a news release from CGMC President Ron Johnson reiterating that Greater Minnesota communities are counting on the Legislature to pass a $30.5 million LGA increase this year. The CGMC also sent a letter from Ron to all Greater Minnesota legislators arguing that an LGA increase is necessary to provide balance to the tax bill, because 73 percent of the property tax relief provided by cutting the state general levy will go to property located in the metro.

What about a bonding bill?

Governor Walz and the legislative leaders have agreed to a $500 million bonding bill, which includes $440 million in general obligation bonds and $60 million in housing infrastructure bonds. However, the details of what will actually be included in said bonding bill have yet to be determined. From the CGMC perspective, we are hopeful for dollars for clean water infrastructure (PFA $$$), the Greater Minnesota Business Development Infrastructure grant program and child care facilities grants. Several of our member cities also have important projects vying for funding.

It is important to note that unlike other bills, the bonding bill requires a supermajority to pass. That means that it will not pass in either the House or Senate unless some legislators in both chambers vote across party lines. In comments made to reporters following announcement of the budget deal, House Minority Leader Kurt Daudt threw some cold water on the idea of any House Republicans voting for a bonding bill. However, it is quite possible that some House Republicans may choose to break from their party in order to get funding for important projects in their districts.

And CGMC’s child care proposals?

At this point there is no news to report on our two child care priorities: funding for the Minnesota Initiative Foundations (MIFs) for provider training & business assistance and bonding money to build or expand child care facilities. The MIFs proposal is still being considered as part of the omnibus jobs bill, and child care facilities grants are part of the ongoing bonding bill discussions.

Any hope for transportation?

The gas tax was one of Governor Walz’s highest profile proposals this session. He talked about the need for new transportation revenues on the campaign trail and reiterated that commitment the day after his election as governor. This session’s House transportation bill was particularly promising for CGMC priorities. It included new funding for Corridors of Commerce, significant new funding for MSA cities, and a permanent, dedicated funding stream for small cities. When the final budget deal was reached, however, all of those priorities ended up on the cutting room floor.

For cities with populations greater than 5,000, the status quo will hold. With no additional funding coming into the transportation formula, larger cities will not see increases through the municipal state aid formula.

For small cities, the jury is still out, but the path forward is difficult. Without significant new funding for transportation and a relatively small general fund target for transportation, it is difficult to see how the House and Senate come up with a compromise plan that isn’t an abject failure for small-city street funding.

Further, without new funding in the transportation system, significant investments in Corridors of Commerce may not be possible this session. Since it appears that a comprehensive transportation package is now off the table for this year, the CGMC will shift in its focus in the upcoming special session to maintaining the $25 million/year base appropriation for Corridors of Commerce, which the Senate has proposed eliminating. While the Corridors of Commerce program is not perfect and could use some tweaks in the way it scores projects for funding consideration, it remains one of the few mechanisms for funding critical highway projects in Greater Minnesota.

How will the special session play out?

The legislative leaders have hinted at holding a one-day special session on Thursday. Accomplishing that in one day would require suspending the normal procedural rules in each chamber which require action on a bill take place over multiple days. A vote to suspend the rules requires a three-fifths majority, which would require six GOP votes in the House. The House GOP caucus has threatened to vote against such a motion. Failure to suspend the rules means a special session could take several days to finish.

It’s important to note that while there is a global agreement between the Governor, Speaker Hortman and Sen. Gazelka, there are still 199 other legislators to consider — some of whom may not be happy with the terms that were agreed upon or the “cone of silence” that surrounded the negotiations. So while there are just hours until today’s midnight deadline for the regular legislative session, the Legislature’s work remains far from over.

As the special session plays out, CGMC staff will be busy following all the action at the Capitol and continuing to advocate for Greater Minnesota priorities.

Questions?

If you have any questions, please contact CGMC Executive Director Bradley Peterson at bmpeterson@flaherty-hood.com or 651-225-8840.

For Immediate Release
Contact: Julie Liew, jlliew@flaherty-hood.com
PDF version

Below is a statement from CGMC President and Bemidji City Council Member Ron Johnson on the state budget agreement:

“I’m pleased to see that the Governor and legislative leaders have come to a bipartisan agreement on the state budget. As lawmakers continue to hammer out the details, I want to reiterate that there needs to be a $30.5 million increase in Local Government Aid in order for this session to be considered a success for Greater Minnesota. This has been our No. 1 priority since the first day of the session and we will continue to lean on our legislators to make it a reality.

“Gov. Walz campaigned on increasing Local Government Aid and leaders in the House have been vocal in their support for boosting the program. As we move into a special session, it is vital that they continue to fight for communities throughout the state and pass a $30.5 million LGA increase this year.”

###

 

Negotiations at the Capitol may be going at a snail’s pace (see next article for an update). In fact, with just days remaining in the legislative session, it is more important than ever that city officials speak up on key CGMC legislative issues like Local Government Aid (LGA), child care, clean water infrastructure and transportation.
 
Earlier this week, we issued an Action Alert in which we encouraged all CGMC members to contact Governor Tim Walz, Senate Majority Leader Paul Gazelka (R-Nisswa), House Speaker Melissa Hortman (DFL-Brooklyn Park) and your own legislators and urge them pass a $30.5 million LGA increase this year. This remains the CGMC’s top legislative priority. While the CGMC lobbying team has been persistent in advocating for an LGA increase, it is vital that lawmakers continue to hear from you about the importance of LGA and its impact on the strength and vitality of your city.
 
Also earlier this week, our economic development-focused sister organization the Greater Minnesota Partnership (GMNP) issued its own Action Alert regarding the need to pass legislation to help address the child care shortage. Specifically, the CGMC and GMNP are advocating for two legislative initiatives that aim to increase child care capacity in Greater Minnesota: we are seeking $10 million in bonding for grants to help build or expand child care facilities and $2 million to be divided between the six Minnesota Initiative Foundations for child care business assistance and provider training.
 
If you have not yet responded to these Action Alerts, please do so ASAP. Session ends May 20, so there is no time to waste.

It’s crunch time! With only one week left in the legislative session, Governor Walz and legislative leaders are in the thick of negotiations to determine the next two-year state budget and find common ground on other critical issues. Among the many issues still in limbo is the CGMC’s top priority: a $30.5 million increase in Local Government Aid (LGA).

The House and Governor both included the $30.5 million boost in their budget proposals, but there is no LGA increase in the Senate’s plan. To see how your city would fare under the House and Senate plans, click here.

With the clock winding down, it is more important than ever that city leaders speak up about the importance of LGA and the need for an increase this year.

Take action now!

Contact Governor Walz, House Speaker Melissa Hortman, Senate Majority Leader Paul Gazelka and your legislators TODAY and urge them to agree to a $30.5 million LGA increase this session.

Tell them that:

  • You and your community are counting on the Senate, House and Governor to work together to pass a $30.5 million LGA increase this session to finally restore the program to its 2002 level.
  • Any meaningful tax bill must include an increase in LGA—the most effective tool the state has for building strong communities in Greater Minnesota.
  • 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.

Contact info

Questions?

If you have any questions about LGA or the legislative session, please contact Bradley Peterson at bmpeterson@flaherty-hood.com or 651-259-1911.

With just less than three weeks left in the legislative session, it is vital that we work together to keep legislators focused on Greater Minnesota priorities such as Local Government Aid (LGA), child care, clean water infrastructure and transportation. To help advocate for these and other issues, we encourage all Greater Minnesota city leaders to join us for an End-of-Session Lobby Day & Ice Cream Social on Wednesday, May 8. 

The event is FREE to attend, but please RSVP by sending an email to Meghan at RSVP@flaherty-hood.com (include your name, city and position/title).

We hope to get as many city officials to attend as possible! Share this Lobby Day Flyer and encourage other city officials and staff to join us.

Parking Info – Attendees may park for free in the lot located at 525 Park Street in St. Paul, just a block from the Capitol. However, a parking permit is required. Please print this parking permit in color, write in the event date (May 8) and place it on your dashboard.

If you have any questions, please contact Julie Liew at jlliew@flaherty-hood.com.

The Senate tax bill, which was released Tuesday, contains NO increase in Local Government Aid (LGA). In contrast, the House tax bill and Governor Walz’s budget proposal both contain a $30.5 million increase, the same amount that the CGMC is seeking. This is the CGMC’s No. 1 priority for this legislative session.

With less than a month until the session adjourns, there is still time for the Senate to change course and support an LGA increase — but we need your help!

Contact your senator and Senate leaders TODAY and let them know that it is critical that they pass a $30.5 million increase in Local Government Aid this session!

Take action now!

Contact Senate Majority Leader Paul Gazelka, Senate Tax Chair Roger Chamberlain and your senator by no later than Monday, April 29 and urge them to pass a $30.5 million increase in LGA this session.  

Tell them that:

  • The current Senate tax bill is unacceptable.
  • 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 Senate, House and Governor to work together to pass a $30.5 million LGA increase this session to finally restore the program to its 2002 level.
  • 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.

Contact info

  • Contact Senate Majority Leader Paul Gazelka using this email form or at 651-296-4875.
  • Contact Senate Tax Chair Roger Chamberlain using this email form or at 651-296-1253.
  • Find your senator’s contact information by visiting Who Represents Me?

If you have any questions about LGA or the legislative session, please contact Bradley Peterson at bmpeterson@flaherty-hood.com or 651-259-1911.

 

For Immediate Release
Contact: Julie Liew, jlliew@flaherty-hood.com
PDF version

Below is a statement from CGMC President and Bemidji City Council Member Ron Johnson on the Senate tax bill, which fails to include any additional funding for Local Government Aid (LGA):

“A $30.5 million increase in Local Government Aid is our organization’s highest priority, yet the Senate fails to add even one cent more to help our communities keep up with rising costs. Without an LGA increase, cities will fall further behind and continue to struggle to provide essential services that our residents and businesses rely on. The Senate position will undoubtedly lead to property tax increases and potential cuts to vital city services.

“The positive side is that there is still time for the Senate to reverse course. We are grateful that the Minnesota House and Gov. Walz have both been steadfast in their support for a $30.5 million LGA increase this session. We are counting on them to continue to advocate for the needs of Greater Minnesota communities as negotiations heat up in the coming weeks.”

###

With the Legislature currently on hiatus for the Easter/Passover break, CGMC staff members hit the road this week to meet with editors and reporters in Greater Minnesota to provide an update on our legislative priorities and discuss our hopes heading into the final month of the legislative session. Stops included the newspapers in Hutchinson, Willmar, St. Cloud, Fargo/Moorhead, Fergus Falls and Alexandria. (Here’s an article about our visit to the Fergus Falls Daily Journal.)

At the meetings, we shared this mid-session progress chart, which shows where the Governor, House and Senate each stand on the CGMC’s top priorities including Local Government Aid (LGA), child care, transportation and clean water infrastructure. As this end-of-session handout indicates, we also reiterated that we are calling on the Governor and legislative leaders to work together over the next few weeks to do more than simply pass a “lights on” state budget. We emphasized that in order the 2019 legislative session to be considered a success for Greater Minnesota, the Legislature and Governor must:

  • Pass a tax bill that includes a $30.5 million increase in LGA.
  • Pass a bonding bill that includes $67 million for Public Facilities Authority clean water grant and loan programs, as well as funding for child care facilities, the BDPI program and other infrastructure investments.
  • Pass a comprehensive transportation bill that raises new revenues and provides funding for city streets and the Corridors of Commerce program.

We would like to extend a special thank-you to the local city officials who joined us for some of the media visits: Willmar City Councilor Audrey Nelsen, St. Joseph Mayor Rick Schultz, Moorhead City Manager Chris Volkers and Alexandria City Administrator Marty Schultz.

Although this year’s legislative session is five months long, it’s no secret that the final two weeks of session are especially critical. This is when negotiations really heat up and final decisions are made. As we countdown to the Legislature’s May 20 deadline, it is vital that that you continue to speak up about important CGMC issues such as Local Government Aid, wastewater infrastructure, child care and transportation. To help keep legislators’ attention focused on our top priorities, we invite all Greater Minnesota city leaders to join us for an End-of-Session Lobby Day & Ice Cream Social on Wednesday, May 8. 

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)
  • Lunch on your own
  • 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 by sending an email to Meghan at RSVP@flaherty-hood.com (please include your name, city and position/title).

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 jlliew@flaherty-hood.com or 651-259-1917.

The House Property and Local Tax Division Report — in effect the division’s omnibus bill — was released Wednesday. The $146.5 million package includes the CGMC’s request for a $30.5 million increase in Local Government Aid (LGA) which would restore the program to its 2002 funding level.

Other notable items in the division’s report include a $30.5 million increase to County Program Aid, expansion of the Homestead Credit Refund and Renter’s Property Tax Refund programs, an extension of aid to cities for contributions to the Public Employee Retirement System and $1 million for cities with border city enterprise zones.

On Friday, nonpartisan staff will lead a walk-through of the bill and division members will hear testimony from the public. Members of the division will have an opportunity to offer amendments to the proposal on Monday. A final report adopted by the division will be sent to the House Taxes Committee for possible inclusion in its omnibus tax bill.

Relevant links: