Laserfiche WebLink
s Ill <br /> an extension of the formula provision at this time. ' <br /> This position is also consistent with long standing unwritten <br /> policy of the AMM to not pursue positions that would take <br /> away current resources from cities statewide or regionally. <br /> In addition to adoption of this policy in reaction to what is <br /> sure to be a major legislative issue, the Board has entered <br /> into a contract with two consultant lobbyists to provide <br /> increased legislative visibility and to work with the AMM <br /> Legislative Contact System. It appears that along with this <br /> issue, there will be major legislative action in the other AMM <br /> very high priority issues of TIF, Solid Waste Management, Land <br /> Use and Comparable Worth. Although the 1990 Legislative <br /> session was supposed to be quiet and short as concerns city <br /> issues it is developing into something quite different. <br /> 5. STATE BUDGET DEFICIT. <br /> The 1990 legislature must deal with a current biennium state <br /> budget deficit of between $161 million and $200 million plus a <br /> legislative mandate to reduce the state fiscal 1991 budget by <br /> $50 million and the fiscal 1992 budget by $100 million. The <br /> shortfall could be handled by use of the state's $550 million <br /> • budget shortfall or 'rainy day' fund. This is indeed its <br /> purpose, however, this option would create a sizeable <br /> shortfall in the next biennium which would still have to be <br /> addressed by tax increases or spending cuts. Unfortunately, <br /> LGA and HACA are on the table according to both administration <br /> and legislative sources. Cuts in the 1990 calendar year would <br /> be particularly onerous because there would be no way to make <br /> up the cut since property levies have already been set thus <br /> the states budget shortfall would effectively be transferred <br /> to cities. Also, by the time a legislative cut would be <br /> enacted, the cities will be half way through their budget <br /> . . . .. <br /> Administration officials are also examining ways to base aid <br /> cuts on city reserve levels. Presumably larger aid cuts could <br /> be proposed for those cities with larger reserves. It is <br /> unclear as to what will be considered reserves, i.e. , cash <br /> balance as of December 31, or cash minus operating funds until <br /> property tax and state aid payments in June, or excess cash in <br /> various bonded debt sinking funds, etc. Such action over the <br /> long run would be counterproductive since it would encourage <br /> higher spending and more borrowing and would likely result in <br /> lower bond ratings which in turn would increase the cost of <br /> public infrastructure. <br /> -5- <br />