Before the 2015 session of the Minnesota state Legislature began, St. Paul Mayor Chris Coleman thought it would probably be unrealistic to push for an increase in the assistance the state gives to cities, Local Government Aid (LGA).
It’s not that Coleman didn’t think an increase in LGA was needed and deserved. He did. But as the son of a long-serving state Senate majority leader, he also knows something about counting votes. And with the Legislature split between a Republican House and a Democratic Senate, hanging onto LGA increases adopted two years earlier might be the best he could hope for. And though a February revenue forecast that boosted the state surplus to $1.9 billion gave him some hope of an increase, he wasn’t counting on it.
There was one thing, though, that he didn’t anticipate. The budget proposal the House GOP eventually unveiled didn’t add to LGA. Nor did it freeze it. Instead, the Republicans’ plan actually cut $84 million from the $500 million program.
It got worse. Rather than making the reduction across-the-board, as had happened during economic downturns, the plan targeted the cut: St. Paul, Minneapolis and Duluth would absorb the entire hit.
Was it a coincidence that all three send DFL-heavy delegations to the Capitol? Was it simply by chance that the state’s only other first-class city, Rochester — represented in the Legislature by both Republicans and Democrats — was spared from being targeted?
Combined with dozens of House GOP bills and budget provisions proposed this year — on everything from transportation to public schools and parks — it is easy to see how some political leaders from St. Paul and Minneapolis might take it all a little personally.
“It’s an all-out assault,” Coleman said last week. Since the savings from the LGA cuts are not being distributed to smaller cities across the state, Coleman said. “They’re just punishing us. They’re not helping anyone.”
Minneapolis Mayor Betsy Hodges echoes the point, arguing that the Twin Cities area is vital to the state’s economy, producing tax revenue in excess of its population. “Going after the metro area is not going to make Greater Minnesota better off and it is not going to make the state of Minnesota better off.”
Hodges said the dialogue this session is different than in the past when Republicans controlled one or both houses. “There’s always some tension, but this is a blatant attempt by those in the House to pit Greater Minnesota against the metro.”
GOP leaders say numbers are driving policy
No one’s surprised the focus of the House GOP isn’t on the metro: Republicans won control of the House last fall by gaining 10 seats in Greater Minnesota, and they came to the Capitol in January with a rural-first mantra. But House Republican leaders and budget writers deny any coordinated campaign to specifically go after the metro.
Said House Speaker Kurt Daudt: “Republicans are coming forth with real ideas that represent what we think are the priority of all Minnesotans all over the state. If Democrats think that Minneapolis and St. Paul are getting left behind right now, I disagree with that. But then they ought to open their eyes up to the way that the rest of Minnesota felt over the last two years.”
GOP lawmakers say it was numbers, not politics, that drove the LGA change. “We realized…they were being paid significantly more than the average of the rest of the cities throughout the state,” said GOP Rep. Steve Drazkowski of Mazeppa, chair of the House Property Tax and Local Government Finance Division. “As a matter of fact, under this bill, those four cities will still be getting more LGA than the average of the rest of the cities in the state.”
Gov. Mark Dayton has called the LGA cuts a “non-starter.” And Senate Majority Leader Tom Bakk, a Democrat from Cook, said his caucus wants to go in the opposite direction. The Senate tax bill, released this week, increases LGA funding by $45.5 million over two years, restoring the program back to 2002 levels. If the House GOP doesn’t like how the money is distributed, Bakk said, they should have proposed a study group to take a comprehensive look. Lopping off money for just three cities suggests partisan motivation.
“It’s easy to make changes in someone else’s district, when it doesn’t impact you…that’s what you see the Republicans doing,” Bakk said. “They don’t have any members in their caucus who represent Minneapolis, St. Paul or Duluth, so they think, ‘Hey! This is a freebie for us.’”
Duluth DFL Rep. Erik Simonson agreed. “What’s the common theme here? Republicans don’t like Democrats, right? That’s gotta be what it is. It can’t just be a metro, because my city isn’t in the metro. It can’t be a first-class city thing, because we didn’t touch Rochester.”
Current LGA formulas aren’t driven only by population, and Democrats noted that hundreds of state cities get more state aid than they would if population was the only driver. The money is distributed under a rather complex formula created in 2013, with aid totaling $517 million this year. Unlike previous years when LGA was reduced, the proposed cuts are coming at a time of revenue surplus.
House Tax Chairman Greg Davids from Preston said he thinks the LGA proposal is justifiable based on the numbers, but said he is open to conversations with the cities. “This debate isn’t done. We will keep working on it. My door is open to Minneapolis, St. Paul and Duluth legislators and their officials.”
Met Council targeted
The proposed LGA reductions are the most-direct — but hardly the only — House actions causing angst among political leaders in the metro area. Many of the proposals at issue are aimed at the Metropolitan Council, the regional entity that does growth, housing and transportation planning and directly delivers transit and sewer services.
The regional body was the target of criticism by Republicans during the 2014 campaign for regional plans the GOP considered too far-reaching, and for a governance structure that insulates the council from local concerns.
There are currently dozens of proposals in the Legislature that attempt to deliver on a GOP campaign pledge to “rein in” the Met Council. Several are aimed at slowing down plans by cities and counties to build new light rail, streetcar and bus rapid transit lines — even though the state’s share of constructing these routes is just 10 percent. (A proposal by Dayton would cut that share to zero if the region is permitted to increase its local sales tax.)
One budget provision, in particular, has drawn the attention of metro area county officials: the rewriting of a pledge made by previous Legislatures to split operating costs of light rail and bus rapid transit lines with the Counties Transportation Improvement Board. The source of the CTIB money is a quarter-cent sales tax in five metro area counties, which was imposed by county commissioners with a promise that it would not supplant existing transit funding, but instead would be used to expand service. The new House proposal would have CTIB pick up the entire cost.
Hennepin County Commissioner Peter McLaughlin calls the proposal a break of faith with county officials and voters: “We passed the tax. We put our election certificates on the line to expand service. They like to talk about how important local government is but this is a direct assault on local government.”
Metro Transit service would have to be cut
The House’s proposed transportation omnibus bill contains even more pain for the region. It includes none of the mass transit enhancements included in Gov. Mark Dayton’s transportation plan. All told, the Republicans’ plan dedicates $160 million to metro and rural transit over the next decade, while Dayton and Senate Democrats want something closer to $3 billion.
Because of inflationary costs as well as federal and state mandates regarding Metro Mobility, which provides rides to people unable to use regular bus service due disability or health conditions, the Met Council has pointed out that the House’s no-increase-for-mass-transit provision would actually force cuts to Metro Transit service. Regular route service would have to be reduced by 8 percent or $28 million next year, Met Council staff asserts.
Republican Rep. Mark Uglem of Champlin said the House’s actions aren’t motivated by hostility toward mass transit as much as keeping the promise to emphasize building and maintaining roads and bridges. “I’m a former mayor and I have a degree in urban studies; I understand the need for mass transit,” said Uglem. “I’m not totally against light rail. The trouble is the way it’s managed and put together it’s outrageously expensive. It’s a matter of priorities, and right now I think the priority is roads and bridges, and we are playing catch up with that. We’ve spent billions of dollars on mass transit over the last few years, it’s time to turn our priorities and attention to roads and bridges.”
During the campaign, two specific topics drove the GOP talking points on urban vs. outstate politics — the roads or transit debate and the possible effects of the Thrive 2040 plan.
Thrive 2040 is the Met Council’s most recent 30-year plan, meant to create the overriding policy that guides the council’s plans around transportation, housing, water resources and regional parks. But the plan is viewed by many Republicans as an overreach — a move to assert urban prerogatives on rural and suburban areas. In addition to calls for making these plans advisory on cities and counties, there are bills that would force the Met Council to get legislative approval for most actions and all spending plans.
“I’m hopeful that we can have some reform on the Met Council,” said Uglem. “We need to make it a more democratic organization. With the budget that they have of almost $1 billion, the fact that they are unelected political appointees, I don’t think sits well with most people if they really look at it. There’s a top down management style that happens at the Met Council and it needs to be more inclusive.”
McLaughlin, a county commissioner since 1991, was pragmatic about the politics. The new House GOP majority is staking out a position before talks with the Democratic Senate and Democratic governor begin in the closing weeks of the session. “This is where I would expect to be on April 20,” he said last week.
He doubts Dayton and Senate leadership would agree to a transportation budget without support for mass transit in the Metro. “I’m very confident in their position,” he said. But if House Republicans stick to their position on transportation, “getting nothing passed is always a possibility.”