homepage logo

BE LGA cuts less than expected

By Staff | Jul 19, 2009

The City of Blue Earth, and other government bodies around the state, got some good news in the last round of local government aid (LGA) cuts.

City Administrator Kathy Bailey informed the city council at their last meeting that Governor Tim Pawlenty’s unallotment of Blue Earth’s LGA for 2009 was less than had been anticipated. The June cut is $75,680.

Last December the unallotment of the 2008 LGA was $109,755, Bailey pointed out. The total of the two cuts is $185,435.

“Our staff was prepared for a lot more in cuts,” Bailey says. “We prepared a list of budget cuts for the council to consider that totaled $264,954.

In addition, the city left open a police department position. That savings over a year’s time would add $66,938. However, the council has not decided how long to leave it unfilled. The city has also put off purchasing some public works equipment, or buying it using an equipment bond, which would spread the cost out over yearly payments.

Bailey says she is not sure what items which were on the cut list might be put back into the budget. That would be up to the council and could be discussed at the July 20 meeting.

Looking ahead to next year, Bailey says the city’s LGA from the state is slated to be increased to $1,725,269. However, the governor’s budget already has unallotted $189,200 from that amount.

Bailey told the council at their last meeting that there was a bill passed by the legislature in 2008 which would allow the city to levy back the amount they lose in LGA through unallotment.

That means the city council could increase the local property tax levy to recoup the $185,435 in cuts.

“That would mean a 16 percent levy increase just for covering the unallotment,” Bailey says. Plus, the council could add in amounts under their levy limit requirements which would boost the increase to 20 percent. “I very much doubt the council is willing to levy back the whole amount of LGA lost in the first place,” Bailey added.

However, discussion on the budget, state cuts and the levy could come up at this Monday’s meeting, as work on the 2010 budget begins now and continues for the next several months.