Feb 17 The Governor's Budget Proposal & What We Know!

The Governor's recommended budget proposal (PDF file) here. The StarTribune reports:

Aid to cities, counties and health and human services took the deepest cuts in Pawlenty's proposal. The governor, who is in his last year in office, pledged to protect programs for the military, veterans, public safety and money for K-12 classroom education.

According to the governor's office, the budget cuts $1.2 billion by paring $250 million from aids to local units of government; $347 million from health and human service programs; $47 million from higher education funding, and $181 million from state agencies and other programs.

The budget also includes a 20 percent reduction in the corporate tax rate, which would cost the state $10 million through next year and $150 million in the following two years, and a 20 percent reduction in small business taxes, which would cost the state $118 million in fiscal years 2012 and 2013.

Mayor's Comment: Many have asked my thoughts about Governor Pawlenty's budget proposal and how it affects Clarissa. Well, just looking at the numbers Certified LGA for Clarissa will go from $160K (2010) down to a proposed $85K (2011).  A $75,000 dollar reduction in money that comes into our city.

It is sobering figure for sure, yet, I have come to understand that with every legislative session figures will change between DFLers and GOPers about a hundred times.  What I am most interested to see is if the Supreme Court will uphold the Governor's unallotment powers.  (The Mayor remains in favor of the Governor on this issue).  This will be the date that the legislature will get serious about budgets and budgeting.  Everything up to then is grandstanding and political posturing.

A Mayor that's paying attention over the last decade has watched LGA reductions for the last five or six years.  Hopefully they have been honest with themselves and planned for their city that the current LGA system is dying.  Our city has restructured the way we operate and fund operations, so the numbers do not create a sense of panic for myself or our city.  It only means we may have to adjust the pace at which we are heading in a direction that does not include LGA.

I do wish the legislature and governor would have one more designation for small cities.  I think cities with population of less than 500 people that have limited or non-existent enterprise funds should be treated differently.  Many of these cities only have property tax as their source of income. They cannot adjust as easily as our city (which is small), but has enterprise funds that can be refocused on to a transition with LGA reductions.

So what we know is that we know nothing, and everyone needs to stay tuned.

Cross-posted and comments welcome at America's Small City Mayor.