City bosses: Cuts should be spread out

By FRITZ BUSCH

Journal Staff Writer

NEW ULM -- Cities and counties would be forced do without a fourth of their state aid funding, according to Gov. Tim Pawlenty's plan to wipe clean a $4.2 billion projected deficit over the next two years.

Other cuts under the plan are a two-year wage freeze for more than 300,000 public employees at all levels, double-digit funding cuts for colleges and universities, reduced subsidized health care benefits and elimination of the state tobacco endowment.

Under the plan that cuts 15 percent ($8 million) from the Minnesota Historical Society in the current biennium, historic sites at Fort Ridgely State Park, south of Fairfax; and the Lower Sioux Agency, southeast of Morton; would be closed as of July 1. Pawlenty proposed a state law change allowing citizens to petition for reverse referendums by 2005 to contain local spending.

While Mankato Mayer Jeff Kagermeier said a 22 percent cut in local aid would require severe cuts in essential services, might force the closing of the municipal swimming pool and cause the city to layoff workers, things don't appear as bleak closer to home.

New Ulm City Manager Brian Gramentz said the plan is just the beginning of another long, drawn out process. Cuts will be discussed by the Senate and House and signed by Pawlenty before they become reality.

It's important that rural and metro communities be treated the same, according to Gramentz. Middle or upper-income earners living in growing suburbs that get little state aid, don't send kids to public colleges and aren't transit or state park users would not feel the cuts as much.

"Everybody should be willing to give up something," Gramentz said. "There shouldn't be any communities that don't feel any pain. The cut difference is big and isn't something that can be hidden. Metro cities get state aid that we don't. Cuts need to be across the board. The big picture needs to be seen in St. Paul."

Gramentz said essential services like public safety would not be hit hard in New Ulm. The local cut would be $1.25 million. With levy limits, a tax increase could not be utilized to make up the difference.

Local budget cuts could come by using city vehicles a bit longer, looking very closely at overtime and other ways business is conducted.

Sleepy Eye City Manager Mark Kober considered Pawlenty's proposal a worst-case scenario, a benchmark. Using the latest budget formula, about $130,000 in state aid would be lost in Sleepy Eye this year.

"Levy limits would prohibit us from levying taxes back, so it's a double whammy," Kober said. "We'll try to rise above it. We want to make sure we can separate ourselves from towns with less resources."

Kober said towns with less will lose the most resources and cutting capital spending now will drive up maintenance costs later.

Communities that spend their last dime will have a tougher time while others with large reserves may be able to shine during the next few years, according to Kober.

"I think everybody can tighten up a little bit and do a better job," Kober said. "We'll make it and have the chance to shine."

He predicted that final formula figures might not be known until late in the legislative session.

Springfield City Manager Mac Tilberg considers the current economic situation a great time for investing due to low interest rates and construction companies that are begging to bid on projects because so many projects are drying up.

Tilberg said the Springfield City Council just approved a $4,000-$5,000 expenditure to build a ramped skateboard area in Riverside Park. Funding will come from the Rothenburg Family Trust.

The council appears poised to maintain community integrity and service levels. The community is looking at a $60,000 to $160,000 budget cut under the latest proposal.

Springfield needs a new or newer street sweeper since the current one, a 1978 model, broke down and repairs are costly. Tilberg said the City will likely borrow cash to pay for another sweeper since available cash is needed for operating expenses.

"It's still a tax increase, no matter how you add it up," Tilberg said. "We'll have to make some cuts but we don't plan to cut any services. We want the community to keep running forward, although it will be tougher to keep the bar set as high as it was."

Tilberg said suburban cities that raised taxes just by growth should never have received government aid in the first place.

"I hope the cuts don't become a swath down the middle of the field so people with the least have to pay the most," Tilberg said.