Laserfiche WebLink
Viti/h/Li c;?3 <br /> MEMO TO: MAYOR AND CITY COUNCIL 40411 <br /> FROM: CLERK-ADMINISTRATOR <br /> DATE: MAY 1, 1990 <br /> SUBJECT: 1990 STATE AID CUTS <br /> Although I will be providing you with a memorandum in the near <br /> future regarding the results of the 1990 Legislative Session, <br /> I thought it appropriate to provide you with a report as soon <br /> as possible regarding the impacts of cuts in state aids to the <br /> City of Mounds View. <br /> The 1990 Tax Bill provides that the state will withhold an <br /> estimated $46 million in state aid from cities in pay 1990 and <br /> pay 1991 combined. Cities will loose $15.6 million in local <br /> government aid and homestead and agricultural credit aid, <br /> which the City of Mounds View does not receive, in pay 1990 <br /> under the Tax Bill. The aid cut is permanent and therefore <br /> will save the state another $15.6 million in pay 1991. <br /> Cities subject to levy limits, including Mounds View, cannot <br /> • increase their levies in.pay 1991 to make up for the 1.53% aid <br /> cut. Also, the repeal of all City levy limits will not take <br /> effect until pay 1993 (formerly pay 1992) to coincide with the <br /> scheduled repeal of County levy limits. <br /> As stated earlier, local government aids will be frozen in pay <br /> 1991 at the reduced 1990 level, however, cities' levy limit <br /> bases will not be further reduced by the foregone LGA <br /> inflation increases. Therefore, at this time, our local <br /> government aid 1990 and 1991 will only be reduced by the <br /> amount provided for in the Tax Bill which at this time is <br /> estimated at $31,159. Exactly how this reduction in local <br /> - <br /> taken out of one or both of our local government aid payments <br /> in 1990 is unknown at this time. I have requested that <br /> Finance Director Brager review the 1990 budget and advise me <br /> of the current status of the City's contingency account and <br /> other uncommitted funds in order to identify sources that <br /> could be eliminated from the City's 1990 budget to absorb this <br /> loss in aids. <br /> It should be pointed out that there is no guarantee that the <br /> City will not experience additional aid cuts in the future. <br /> The Tax Bill builds in future aid reductions for local <br /> • <br />