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Pawlenty rebuffs angry city officials
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Gov. Tim Pawlenty walked to the Capitol press room on Wednesday to deliver a harshly-worded message to local officials who are complaining about cuts in state aid. (MPR Photo/Michael Khoo)
Gov. Tim Pawlenty is accusing local government officials of scare-mongering in order to preserve their state funding. As part of a $4.2 billion deficit-reduction package, Pawlenty suggested cutting aid to cities and counties by more than 20 percent. The governor says said local officials are exaggerating the impact those reductions might have. But supporters of the state aid say Pawlenty isn't telling the complete story.

St. Paul, Minn. — Minutes after Gov. Pawlenty concluded his budget presentation, officials from cities across the state joined in a chorus of protest. The governor recommended a significant cut in state aid to local governments, and mayors predicted the reductions would lead to harmful cuts in police and fire protection. But Pawlenty says as a percentage of total city revenue, the cuts are capped at five percent in the first year and at 10 percent the next year.

"If you're on a city council or you're a city manager, and you can't manage a five percent reduction in your total revenues without reducing police or fire services, you should be fired. You shouldn't be in the position that you're in. It's a matter of prioritizing the services. Police and fire are amongst the most important that those local cities provide," Pawlenty said.

The attack in rural Minnesota is almost like geographic genocide.
- Rep. Tom Rukavina, DFL-Virginia

And so began the first skirmish in what's likely to be a protracted battle over local government aid. It's unmistakably a battle over numbers. But Detroit Lakes Mayor Larry Buboltz says Pawlenty has gotten his numbers wrong. First year reductions may be capped at five percent of a city's total revenue, but Buboltz says the meaningful yardstick is general fund revenue. That, he says, is an important distinction.

"It's the general fund that we have to deal with. I mean, that's where the, basically, our police and our streets and our parks and our libraries come from. And so those are the ones that we have to cut. I mean, you can't cut the permanent storm water fund, for example. That's a tax that's dedicated to storm water," Buboltz said.

Buboltz says the governor's measure of "total revenue" includes dollars already dedicated to retiring municipal bonds or sequestered in special accounts that can't be transferred into the general fund to offset Pawlenty's proposed reductions.

Looking at only at flexible general fund revenues, Buboltz says the reductions are more like 17 percent in the first year and even higher in later years. The size of the cuts are the only complaint. Buboltz and other outstate officials say the reductions fall disproportionately on greater Minnesota cities and the Twin Cities urban core.

Rep. Tom Rukavina, DFL-Virginia, says the suburbs are let off the hook. "The attack in rural Minnesota is almost like geographic genocide. I really hate to say that, but it's true. The social fabric of the state of Minnesota is going to be severely damaged by this proposal."

But Pawlenty says he's surprised by that argument. Pawlenty says suburban communities -- including his hometown of Eagan -- will see relatively lighter LGA reductions simply because they, historically, haven't relied on those payments. Pawlenty argues it's hard to cut government aid to constituents who aren't receiving any.

"And for those who make that claim, I would say what else would you like us to cut? We cut everything. I mean, what did we miss? don't see a lot of categories of government that were left unscathed," he said.

Pawlenty says he's concerned that local government officials may use the proposed LGA reductions to promote property tax increases. But he says he'll ask the Legislature to impose limits on new tax levies to protect property tax payers.

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