Publisher’s Perspective

By Tim Douglass, Publisher of the Pope County Tribune

Readers have heard about Local Government Aid (LGA) a few times in this newspaper so excuse the repetition because it is important.

Local Government Aid (LGA) is the lifeblood of Greater Minnesota cities. It reduces inequities between communities, restrains property taxes, and ensures that all cities can provide high- quality services regardless of zip code. Yet funding for LGA continues to fall behind rising expenses and inflation.

LGA cuts were used in 2008 and sustained through 2013 to help balance the state’s budget, which was in deficit at the time.  Since then, it has seen moderate increases each year, but now, in 2023, is just reaching the level it was before the state balanced the budget on the backs of smaller, rural communities.

What does that mean?  Well, small cities, like Starbuck, Glenwood, Villard, Long Beach and Lowry have seen their LGA revenues allotted by the state account for a smaller and smaller percentage of their overall budget.   Forcing many cities to significantly raise property taxes and fees to make up the difference.  Despite the small increases in LGA recently, it pales to inflation and the costs of delivering services.

Since 2008, LGA has increased by about 16 percent.  Inflation through 2020, which doesn’t include the high inflation we’ve experiened over 2022, has risen by 27%.

Most small city expenses have risen by about 41% over that same time period.  At the same time, LGA was a mere 3.1% of the state general fund spending in 2008.  In 2022, it was lower at 2.12% of the overall budget.

If you live in suburbia, you may believe that the state should reduce or eliminate funds for LGA.  The suburbs don’t get it.  But that’s because their tax base grows exponentially and property values and growth allow them to be self sufficient.

Most smaller cities in Greater Minnesota do not have that luxury.  Growth is difficult and geographic boundaries don’t allow cities to gobble up more tax base without a fight.

This session, The Coalition of Greater Minnesota Cities, the group that looks out for the interests of smaller, rural communities, has asked lawmakers to pass a $90 million increase in LGA to further strengthen this vital program.

Those of us in Greater Minnesota will benefit from that increase.  In the past, it should never have been a partisan issue, and our current representatives, Rep. Paul Anderson and Sen. Torrey Westrom,  certainly support increases in LGA.  But like many things in the past session, nothing was accomplished because of the election year.

Well, the election is over and its time to for the state legislature to come together and do a few things for Greater Minnesota.  Increasing LGA levels is one, providing financial support for childcare and housing in rural communities is another.

It is difficult enough for smaller cities to actually grow.  Add in increasing property taxes, a lack of childcare and housing shortages and its nearly impossible.