Not long ago, the Minnesota House of Representatives approved legislation that includes many provisions relating to Minnesota’s tax code. But what’s most notable in this comprehensive taxes proposal is what it doesn’t include – tax increases.
That’s right. Despite the fact that Minnesota faces a $5.1 billion budget deficit, House Republicans have followed through on their promise to solve this crisis without raising anyone’s taxes. I supported the proposal.
The liberal perspective is far different. Under their line of thinking, if you don’t raise taxes when times are tough, then someone else surely will. We’ve heard cries that the House is “passing the buck” on to local governments and that by approving a bill that does not raise state taxes we have essentially “passed a property tax increase bill” because local governments will be forced to raise them in order to maintain existence.
All of these scare tactics stem from the continued dysfunctional relationship between state and local governments and the distribution of Local Government Aid (LGA). Minnesota sends various communities LGA in order to help them fund “essential services.”
Clearly this is a program that is no longer working as it was intended and is in serious need of reform.
How else to explain that half of Minnesota’s population lives in cities that don’t receive LGA?
How else to explain that Minnesota’s two biggest cities, Minneapolis and St. Paul, continue to be the biggest pigs at the LGA trough – to the financial detriment of every other Minnesota town that actually needs LGA to survive?
Under our Taxes proposal, 600 cities will receive the same amount of LGA, or the amount they were certified for, as they did in 2010. 240 communities would actually see an increase in LGA funding. Only three would see reductions – Minneapolis, St. Paul, and Duluth.
Minneapolis Mayor R.T. Rybak has complained loudly that his $87.5 million allocation would be trimmed to nearly $48 million. On the House floor, I mentioned that perhaps to make his reduction work, he could trim some of Minneapolis’ “essential services.” Things like $5.3 million to build a “green” roof on Target Center, $1.75 million for public art, and $88,000 for climate change grants.
The mayor took issue with my criticism, telling Minnesota Public Radio that the green roof on the Target Center absorbs water. "We're in a period of flooding in this state. One million gallons of water is captured on that green roof at Target Center that's not going to create flooding in this state."
And he said it with a straight face.
For months, I’ve been urging our local governments, as they prepare their budgets, to expect LGA reductions. While everyone always wants a greater share, to my knowledge most of our local officials understand the state’s predicament and will move forward, much like the state, by living within their means.
It’s an insult to suggest that local governments are simply unable to function without a yearly increase in state funding. All governments in Minnesota need to focus on priorities and reduce spending on those things they cannot afford and do not need at this time.
Instead of accepting the annual liberal scare tactic about the state’s decision to not raise your taxes, ask yourself this common sense question: When 600 local governments are receiving the same amount in LGA as last year, and 240 are receiving an increase, why would local property tax increases be necessary?
They aren’t necessary, unless you don’t believe government – any government – should live within its means.