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The major problems confronting the City Council are the fiscal and physical <br />planning needs of the City. This has been further complicated by the <br />economic conditions at the National and State levels. The major problems <br />here are as outlined below: <br />a) Revenues - The following problems exist in this area: <br />1) Federal Revenue Sharing Recent legislation authorizes <br />the Revenue Sharing Program for an additional three years. <br />There was no increase in funding, and the formula was not <br />changed. <br />2) State Aids' The City does. not receive its proportionate <br />share of the distribution of the State aid to cities. This <br />is due to the inequities in the State law that distributes <br />this revenue back to cities in the State of Minnesota. The <br />City of Ramsey is taking the State of Minnesota to court <br />regarding the unfairness of the present State aid formula <br />that distributes local government aid to cities. <br />This :year the local government aid payment to the City of <br />Ramsey is projected as $171,311, which represents 11.8% <br />of operating fund revenues. <br />b) Levy Limitation Law This year this restriction had a major <br />affect on the City. In the future as noted by the financial <br />analysis prepared by the City, if the City receives its fair <br />share of State aid, the levy limitation would not be .a major <br />problem. <br />Mandated Requirements Federal and State mandated programs <br />which require cities to spend tax dollars to be in compliance <br />with these laws, in many cases usurp the local government's <br />authority. It is felt that if the State and Federal governments <br />want to adopt these types of controls, they should fund them. <br />d) Inflation and Recession - This has had a tremendous affact on <br />all areas of 'the City's cost of operation. We may see this <br />level out if the Nation's economists are correct in their <br />projections. <br />Growth - The City's growth has created demands for better services' <br />within the City such as police, streets, parks, etc. This demand <br />is really getting to be a major problem to the City and we are <br />really going to have to watch it. <br />The City's reaction to the above has been as follows: <br />a) The City has become very involved in legislation at the State <br />level during the past four legislative sessions to get the <br />State law governing the distribution of State aid changed where <br />it will be more equitable to all cities. The City Council is <br />finding that even laws that produce inequities are very difficult <br />to change. <br />II-6 <br />