Commentary; Posted: 2/4/04

Let taxpayers, not St. Paul, control city budgets

Thereís a sneaking suspicion at city halls across Minnesota that the 2004 Legislature will reimpose municipal levy limits that are set to expire in 2005.

The Minnesota League of Cities suspects legislators are afraid city councils will raise taxes and spending in 2005 after losing state aid and tightening budgets in 2003 and 2004.

The citiesí fears may be exaggerated. But as the 2004 session opens this week, cities are right to guard against reimposition of levy limits.

State-imposed limits on city and county taxes were begun in the 1970s when the Legislature created the Local Government Aid program to control spiraling property taxes. Legislators typically apply levy limits after increasing aid to local governments.

In a reversal of past policy brought on by a $4.5 billion state budget deficit, the 2003 Legislature discarded its old guidelines and tied levy limits to cuts in state aid. Cities could raise their 2004 levies only enough to recover 60 percent of aids that were cut to help balance the state budget.

Provisions that in the past allowed cities to capture extra taxes based on tax-base and population growth were eliminated.

Cities have responded to their revenue losses prudently, in many cases without soaking taxpayers to the max to recover their losses. Of the 211 cities covered by levy limits ó those with populations over 2500 ó 150 will levy the maximum amount allowed by law in 2004.

Many of those rely heavily on state aids because of their relative lack of property wealth.

Sixty cities, including many Twin Cities suburbs, chose to not levy the maximum allowed. Along with state agencies, cities are doing their part to absorb the effects of Gov. Tim Pawlentyís no-new-taxes response to the budget crisis. Many have laid off workers. Many city positions vacated by attrition are going unfilled. Cuts in lifeguards and warming-house hours, though not the biggest money savers, are being noticed by the public.

Cities approved their 2004 budgets without a property tax revolt. Theyíve made the necessary adjustments for 2004 and will have a year to gauge the effects of the cuts. Their 2005 budgets shouldnít be artificially constrained by legislators who fear that blame for property tax increases might land on their doorsteps.

ìCity council members do listen to their constituents out there,î said Gary Carlson of the League of Minnesota Cities. ìThey know thereís pain associated with raising taxes. Nobody likes to raise taxes.î

Let local taxpayers, not St. Paul, judge local budget decisions.

ó An opinion from the ECM Publishers Editorial Board. The Forest Lake Times is part of ECM Publishers.

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