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House of Representatives > House Research > Taxes > Major State Aids & Taxes
In the 2003 legislative session, county general-purpose aids were restructured into a single program called county program aid. The following individual aid programs were eliminated: homestead and agricultural aid credit (including manufactured housing HACA), county criminal justice aid, family preservation aid, and attached machinery aid. The formula for distributing county program aid encompasses some factors from the programs being subsumed, along with some new ones. One-half of the funding for county program aid is distributed based on each county’s relative shares of (1) persons receiving food stamps, (2) age-adjusted population (population weighted more heavily for the number of persons over age 65), and (3) reported crimes. The other half is distributed based on a formula that takes into account each county’s population and its property wealth.
For 2004, approximately $112 million was distributed based on the distribution formulas of the aid programs that were eliminated, minus the substantial aid cuts enacted during the 2003 legislative session. For 2005 through 2008, about $205 million was distributed according to the new formula, with the aid cuts fully restored.
The total amount of county program aid for taxes payable in 2007 is $205,382,792. This total is after subtraction of $500,000 to pay for court-ordered counsel and $214,000 to pay for preparation of local impact notes.
The county program aid data was obtained from the Department of Revenue.
One-half of the funding for county program aid is distributed based on each county’s relative shares of (1) persons receiving food stamps, (2) age-adjusted population (population weighted more heavily for the number of persons over age 65), and (3) reported crimes. The other half is distributed based on a formula that takes into account each county’s population and its property wealth. This distribution replaces the distributions under the four aid programs under the old law, which are described below.
Homestead and agricultural credit aid (HACA) was a state aid program that originated in 1990 to compensate taxing jurisdictions for major structural changes in the property tax base made in 1988 and 1989. From 1990 through 2001, county government HACA payments increased modestly each year based on the county’s growth in number of households; in addition, HACA payments were permanently increased in some years to compensate counties for legislatively determined tax base reductions. In some years, HACA payments were permanently reduced when the state took over certain local government financing responsibilities (such as court financing). In its last year of full funding (2002), the total amount of county HACA payments statewide was $204.8 million.
County criminal justice aid (CCJA) was a state aid to county governments originated in 1993 to reduce the reliance of criminal justice and corrections programs on property taxes. One-half of the aid was distributed to each county based on the county’s population; the other half was distributed to each county based on the reported number of serious (“Part I”) crimes committed in the county. The appropriation for CCJA increased each year based on the rate of inflation. In its last year of full funding (2002), the total amount of CCJA payments statewide was $31.5 million.
Family preservation aid (FPA) was a state aid to county governments to reduce the reliance of out-of-home placement costs on property taxes. The initial allocation of FPA in 1995 among counties was based on two factors—each county’s share of total children in out-of-home placement in the state and each county’s share of income maintenance cases in the state. After 1995 each county’s aid increased or decreased based on the change in its relative share of income maintenance caseloads in the state. The appropriation for FPA increased each year based on the rate of inflation. In its last year of full funding (2002), the total amount of FPA payments statewide was $23.4 million.
Attached machinery aid (AMA) was a state aid to county governments to compensate counties for removing industrial attached machinery from the property tax base in the early 1970s. Only the 13 counties having the most attached machinery as a share of their property tax base received aid under the program; the amounts were static from year to year. In its last year of full funding (2002), the total amount of AMA payments statewide was $2.4 million.
| County Program Aid: 2007 Distribution | |||
| Amount (thousands) |
Percent of Total | ||
| Northern Regions | Northwest (1) Headwaters (2) Arrowhead (3) West Central (4) Five (5) East Central (7E) |
$6,261 5,630 17,405 11,142 5,853 6,929 |
3.0% 2.7 8.5 5.4 2.8 3.4 |
| Southern Regions | Six East (6E) Upper MN Valley (6W) Central MN (7W) Southwest (8) Nine (9) Southeastern MN (10) |
5,507 3,638 15,080 7,976 10,877 22,070 |
2.7 1.8 7.3 3.9 5.3 10.7 |
| Total Nonmetro | $118,369 | 57.6% | |
| Metro Region | Hennepin County Ramsey County Remaining Metro |
30,539 16,509 39,966 |
14.9 8.0 19.5 |
| Total Metro | $87,014 | 42.4% | |
| State Total | $205,383 | 100.0% | |