Chanting Points Memo: “LGA Cuts Are Destroying Minnesota” (Part V)

Last week, someone asked “what about Rochester”.

Interesting questions.

The “Big Three” – Minneapolis, Saint Paul and Duluth – are interesting cases in that they have all been run by more-or-less DFL-dominated regimes for all of recent memory; the Norm Coleman/Randy Kelly years in Saint Paul were an anomaly in that you had moderate DFLers (Coleman eventually became a Republican) running the show. 

All three cities have been represented by various flavors of DFL – from moderate to crypto-maoist, with a huge “progressive” preponderance – at all levels, from Washington DC all the way down to city council.

Rochester is a lot more interesting.  It’s a stereotypically Republican town – although it certainly has a powerful DFL involved in the city and region’s politics, being represented by Tim Walz as part of the First Congressional District.

  2002 2009 Before Unallotment 2009 After Unallotment
Rochester LGA $10,700,664 $8,979,816 $7,307,970
Rochester Levy $22,480,214 $41,486,193 $41,486,193
Rochester Pop 89,325 102,437 102,437
    MVHC Cut: $1,671,846

 And Rochester gets significant Local Government Aid – although in 2009 it amounted to $71 per Rochester resident, as opposed to $343 per Duluther.

But the big difference is in population:  Rochester is actually the third-largest city in Minnesota now, and has grown 14% during the Pawlenty years, as the Twin Cities grew slightly and Duluth shrank.

As a result – while the Twin Cities “tax Capacity” has been fairly stagnant (less due to collapsing property values than to the fact that the Cities have no place to grow; surrounded by ‘burbs, they can’t annex anything), while Rochester’s has grown 53% during Pawlenty’s administration.

Rochester is expanding physically, of course, and that helps the tax base (and helped shrink the city’s LGA by about 30% during the Pawlenty years).  But the demand for the space it has is growing, and the health of the local and regional economy plays a role; the city wouldn’t be expanding if there weren’t jobs for people to do.

 Correlation doesn’t equal causation – but the fact that Rochester has a functional two-party government certainly can’t hurt its prosperity, compared with the stagmant one-party miasma of the Twin Cities.

Still – notwithstanding the fact that Local Government Aid, which was instituted to help move money from the state’s wealthy urban/suburban areas to the stagnant outstate area (call it “municipal welfare”), it currently awards the state’s Big Four cities, where just over one in five Minnesotans live…

  2002   2009 After Unallotment
Big 4 Pop 845,156   865,843
Total city Pop 3,930,406   3,930,413
Big 4 % of Pop 21.5%   22.0%

…with well over half of the Local Government Aid…

  2002 2009 Before Unallotment 2009 After Unallotment
Big 4 LGA $225,457,015 $191,096,688 $174,328,384
All others LGA $339,533,937 $335,044,859 $307,193,549
Big 4 % of LGA 66.4% 57.0% 56.7%

…which means twice as much Local Government aid per resident goes to Duluth, the Twins and Rochester…

  2002 2009 Before Unallotment 2009 After Unallotment
Big 4 per capita LGA $266.76 $220.71 $201.34
All others LGA per capita $110.05 $109.33 $100.24

…as to the rest of the state, even with Rochester’s proportion shrinking by almost a third.


On a related note, someone from the League of Minnesota Cities has been discussing my series on Twitter.  He notes that LGA has not risen or fallen in a straight line over the Pawlenty years; if you look at LGA statewide and for individual cities, it bounced up and down quite a bit. 

That is a fact. It also doesn’t change my conclusions, which are…

  • …that for all the left’s caterwauling about Pawlenty “leaving a mess” after eight years by cutting LGA, that local governments have seized far more of this state’s wealth via property tax hikes than they ever lost from LGA cuts, and…
  • …even if you accepted the initial necessity of a “municipal welfare” program like LGA to transfer wealth from the once-wealthy Metro to the once-stagnant-to-impoverished Greater Minnesota, the program has reversed itself, and become a program to launder the profligate spending of the Metro DFL through the rest of the state’s taxpayers, as well as…
  • …a political cudgel the DFL uses to squeeze voters, by simultaneously holding hostage programs that directly impact the taxpayer (firefighters, libraries) even as they jack property taxes far beyond any actual LGA cuts

Most worrisome?  If a DFL governor is elected and the DFL retains control of both houses of the Legislature, you know that while the Metro’s property taxes will not budge significantly downward, the statewide taxes to cover the promised “restoration” of LGA (with “cost of living” increases) will zoom upward for all Minnesotans as well. 

Thursday – what about the parts of the state that don’t get in on the LGA gravy train?