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Minnesota House of Representatives' <br /> <br />MEMORANDUM <br /> <br />July 15, 1980 <br /> <br />TO' <br /> <br />FROM: <br /> <br />RE: <br /> <br />Municipal Officers on~~' <br />Representative John Claws <br /> <br />Attached Discussion of the Future of Municipal Aids <br /> <br />I thought you might find the discussion in the attached article to be both <br />interesting and helpful. <br /> <br />As the article says, "The states had built a record of progress and innovation <br />in assisting their local governments. Now tight spending limits and a troubled <br />economy herald a new, leaner era --- with troublesome consequences for many <br />cities. <br /> <br />Though the article highlights the potential for problems in America's larger <br />cities, don't be misled into believing that our smaller cities will escape un- <br />harmed. It is impossible to cut taxes, reduce taxation rates and significantly <br />add to the municipal aid formula. <br /> <br />I judge that, given the current state of Minnesota's finances, and in light of <br />the reality of the "official" nature of the figures generated by the 1980 Federal <br />Census and the population changes for various areas of the'state which those <br />figures will announce, the 1981 Legislature will be a major battleground over the <br />issue of municipal aids. Will we be continuing.our state-local fiscal partner- <br />ship, or will we be falling back on the old standby of property taxes for financing <br />of municipal services? Will we merely cut back even further on municipal services? <br />'Will we be adopting new tax strategies: The "piggyback" sales tax? The income <br />tax local surtax? <br /> <br />I'd be grateful to know your thinking on this issue after you've had a chance <br />to read and think and talk it over amongst yourselves. <br /> <br />JC'sd <br /> <br /> <br />