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Preston concerned over expected LGA cuts

Fri, Jan 23rd, 2009
Posted in Government

City Administrator Joe Hoffman updated the city council as to expected Local Government Aid (LGA) cuts from the state at the January 20 meeting. He said that more will be known when the Governor Pawlenty's budget is released on January 27.

Hoffman noted that in the governor's State of the State speech, Pawlenty spoke of a 2% increase in K-12 funding. This will mean that other areas including Health and Human Services and LGA will sustain a larger cut.

Mr. Hoffman had consulted the League of Minnesota Cities which informed him that the LGA payments of $500,000,000 state wide could be cut by $150,000,000. Preston could loose $100,000. If the LGA payments were cut in half, the city payment could be reduced $200,000. Hoffman expects the reduction could be somewhere in between. These cuts will affect the 2009 city budget.

Hoffman stated that the $60,000 increase that had been budgeted for 2009 for the street department has already been taken back. He suggested that if the LGA cut was around $100,000, the city staff could work with department heads to ind the other $40,000. However, anything over that would require council members to make decisions to target cuts. Hoffman added that the council would likely have to consider tax increases for 2010. He remarked that there would be a better sense of the amount of reduction the city has to deal with by the February 2 meeting.

Other Business

• Mayor Kurt Reicks drew Cindy Mensink's name as the winner of the energy star clothes washer for the Catch Savings in Preston. Hoffman said that at the next council meeting they will draw the winner of the TV.

• A resolution was passed adopting an ordinance establishing a physically disabled parking zone on the East side of Pleasant Street in front of the Preston Apartments owned by Andrew and Anita Bisek. The parking zone had been requested by Richard Hovelson.

• The council decided to postpone until May a $500 donation normally given by the city of Preston to the Southeast Minnesota Initiative Foundation out of Owatonna. The city may at that time give the donation, reduce the amount or skip this year altogether depending on LGA cuts.

• The appointment of Tim Kiehne to the EDA was approved.

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