Minneapolis to pursue LGA funds

by John Hageman

The Minneapolis City Council unanimously authorized Monday to pursue legal action to obtain local government aid funds in the event of a state government shutdown.

The city received word last week that the $44 million in LGA funds that the state has appropriated for Minneapolis would not be dispersed if a budget deal is not reached by Friday.

Cities use a combination of property taxes and local government aid to pay for basic services like police and firefighters. Many cities are unable to pay for its services using property taxes alone. LGA, which cities receive twice a year from the state, is used to help keep those taxes down.

Minneapolis Mayor R.T. Rybak said in an interview he wants to avoid a shutdown, but would rather endure a few days of a shutdown than deal with the âÄúdraconianâÄù cuts to LGA proposed by the legislature.

âÄúWe can weather a shutdown with some difficulty,âÄù Rybak said. âÄúWe canâÄôt weather the budget that was passed by the legislature.âÄù

The city will likely use reserve funds to keep things running normally if the payments donâÄôt come, Rybak said.

The city is scheduled to receive half of its $87.5 million in local government aid payments from the state July 26. The rest will come in December.

The League of Minnesota Cities, a voluntary organization of more than 800 Minnesota cities including Minneapolis, is prepared to pursue legal action to obtain the funds, according to its website.

The League petitioned Ramsey County District Court last week to consider LGA a âÄúcore functionâÄù of the state that should continue during a shutdown. The courtâÄôs decision is expected this week.

Neither Minnesota Attorney General Lori Swanson nor Gov. Mark Dayton included LGA payments in their lists of services that should continue in the event of a shutdown.

Gary Carlson, a lobbyist for the League, said because LGA funds are written into state statute, the League may argue the state is legally bound to pay them on time.

Minneapolis has already written the LGA money into this yearâÄôs budget, as the funds were certified last July by the state.