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Lanesboro officials concerned over possible cut in LGA

Fri, Dec 19th, 2008
Posted in Government

Lanesboro city council members voiced their concern over the possibility of the city losing part of their anticipated government aid payment of $121,517 scheduled for December 26. (See chart detailing possible cuts in LGA and MVHC to local communities).

Speaking with Sen. Sharon Erickson Ropes at their regular December 15 meeting, council member Joe O'Connor said that the city has enough funds to pay its bills through the end of the year, but relies on the Local Government Aid payment to cash flow the beginning of the year.

Council member Kevin Drake told Ropes that he was disappointed that the legislature would not allow the city to implement a sales tax, which Lanesboro would use to fund special projects.

Ropes said that the thinking at the legislature is that the state collects enough funds to give Local Government Aid, which eliminates the need for local sales tax.

"There is a disparity between wealthy and low-wealth communities," Ropes said, noting that LGA is meant to help equalize the gap. This allows low-wealth cities to take on capital and other improvements.

But Ropes went on to say that the governor's "no new taxes pledge" has left the state short of revenue.

"This doesn't change the needs on Main Street," Ropes said. "If the governor makes cuts [to LGA], the costs get shifted from the state to local communities."

Council member Tom Dybing said that because of Lanesboro's high tax capacity, it doesn't do well in the formula that determines local government aid.

There was some discussion on whether the formula should be changed. But Ropes felt that it would be more strategic to try and get a waiver for Lanesboro. O'Connor said that if the cuts are going to be coming, he hoped that they would be equitable.

"If the governor cuts LGA payments, and we lose 37-percent of our December payment, we will have to start eliminating services," O'Connor said.

Ropes said she will take the council's comments to the capital.

"Local government is the hands and feet of state government, we are all connected together," Ropes said.

Campground tax

Members of the Lanesboro Chamber of Commerce were in attendance to urge the council to start collecting lodging tax on campers in the city's campground as the ordinance requires. The ordinance states: "the term lodging means the furnishing for a consideration of lodging by a hotel, motel, rooming house, or municipal campground."

Jon Pieper, vice-president of the Chamber board, said that the lodging tax should have been collected on campgrounds beginning in 2009. The tax is expected to generate around $700 per year which would go toward marketing.

The Chamber is also working with area legislators in a state-wide effort to get private campgrounds to pay lodging tax as well.

Other Business

• The council approved the appointment of officers for the Fire Department: Andy Drake - Chief; Ryan Peterson, Rob Wagner and Jared Wagner - Assistant Chiefs; and Keith Eide - Training Officer.

• The council approved the purchase of an ambulance gurney for $7,800, with two $2,000 donations from the Legion and Fire Department.

• The council approved liquor licenses for Root River Saloon, Parkway Pub, American Legion, Golf Club, Riverside, Pedal Pushers, Das Wurst Haus, and the Vintage.

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