Agenda - Council - 07/28/1981 - Laserfiche WebLink

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s When similar aid projections involving higher inflation are compared with only the minimum and maximum state aid factor increase schedules and brackets being different, there is a slight shift in the percentage distribution of aid from "high spending need" cities and towns to "low spending need' cities and towns when the schedules are adjusted upwards. This can be explained by the fact that more cities and towns have their aid increases based on their minimum state aid factors, and with higher inflation there is greater proportion of "low spending need" cities and towns that receive their aid increases on the basis of their minimum state aid factors instead of their preliminary or maximum state aid factors, in contrast to the "high spending need" cities and towns. However, when the same comparison is made between projections which involve lower inflation, there is virtually no shift in the percentage distribution of aid from one group to the other. This can be explained by the fact that under the lower of the two assumptions concerning inflation, almost all cities and towns in the projections have their aid increases based on their minimum state aid factors by 1990. Thus with low inflation, "high spending need" and "low spending need" cities and towns benefit about equally from increases in the minimum and maximum state aid factor increase schedules and brackets. 5) When levy limit cities and towns are identified as either "high spending need" or "low spending need" cities and towns on the basis of their local property tax levy per capita, shifts in the percentage distribution of aid similar to those related in (4) occur, although the amounts involved are very minor. The same explanations used in (4) can also be used to describe the shifts between "high" and "low spending need" cities and towns when they are identified on k the basis of local property tax levy per capita. 5