by Scott McClallen
On Friday, The Coalition of Greater Minnesota Cities (CGMC) announced priorities for the 2021 legislative session for COVID-19 recovery, including Local Government Aid, child care, housing, and water infrastructure.
“The pandemic has taken a toll on our community,” Greg Zylka, mayor of Little Falls and CGMC president said in a Zoom meeting. “Some segments are still really struggling, and that pain has ripple effects across the city.”
The CGMC said Local Government Aid (LGA) funding is vital to cities’ economic health, many of which have seen revenue drained during the pandemic.
Gov. Tim Walz didn’t include LGA cuts in his proposed $52.4 billion budget announced this week.
Zylka said LGA comprises roughly 40% of Little Falls’ general revenue.
“If the state were to cut LGA, the only way to remedy that without cutting services like police and fire is to tax the heck out of our Communities,” Zylka said. “Our residents and businesses are hurting enough right now. Cutting LGA would be a huge setback in an already difficult time.”
The CGMC is also urging the Legislature to invest in childcare and housing programs.
According to First Children’s Finance, Minnesota was short 39,000 child care spots in the summer of 2020. That demand might increase as more parents return to work in-person.
The CGMC seeks $20 million for grants to construct new or expand existing child care facilities and additional funding for the Department of Employment and Economic Development child care grants.
“As we try to build back our economy and recruit new employers to our city, they want to be sure there is someplace for their workers to live,” Zylka said. “We are experiencing quite a housing shortage in our community.”
Austin City Administrator Craig Clark said his city has struggled to lure developers into building more affordable housing.
“In 2020, seven new single-family homes were built in Austin. We need at least 90 to replace our aging housing stock,” Clark said.
The CGMC is pursuing legislation to incentivize housing construction across the state, including a new grant program to rehabilitate dilapidated homes and other critical public infrastructure.
The bonding bill passed by the Legislature last fall included $269 million for clean water infrastructure, but state agencies argue over $11 billion is needed statewide over the next 20 years.
The CGMC urges the Legislature to pass a bonding bill while interest rates are low with at least $100 million for clean water infrastructure grant and loan programs.
“Some legislators have balked at the idea of passing another bonding bill, but the truth is the need is so great that the state can’t afford not to fund more projects this year,” Peterson said. “If the Legislature fails to pass a bonding bill this year, it will only delay projects and drive up costs.”
Austin received funding in the 2020 bonding bill for engineering construction costs for a new wastewater treatment facility and is now seeking an additional $13 million to continue the $78 million project.
Little Falls is also partway through a $25 million project to build a new wastewater treatment facility, partly funded through $8 million in state grants.
Zylka said that had the city not received state funding, it would have had to raise rates nearly 250% to pay for the project.
“Small cities simply can’t afford to do these projects without help from the state,” Zylka said. “We have fewer residents, and we don’t have the ability to pool resources with other communities like they can in the metro. Clean water is a necessity, and it benefits the entire state, so it is imperative that the state help cover some of the costs.”
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Scott McClallen is a staff writer covering Michigan and Minnesota for The Center Square. A graduate of Hillsdale College, his work has appeared on Forbes.com and FEE.org. Previously, he worked as a financial analyst at Pepsi.