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City of <br /> Elk .�-� <br /> River <br /> MEMORANDUM <br /> TO: Lori Johnson, Sandy Peine, Michele McPherson, Cathy Mehelich, <br /> Steve Rohlf, Phil Hals, Rich Czech, Dave Potvin, Terry Maurer, <br /> Gary Leirmoe, Bruce West, Tom Zerwas, Michele Bergh, Sue <br /> Kostanshek, Chris Johnson, Mick Stoffers <br /> FROM: Pat Klaers, City Administrator <br /> DATE: February 24, 2003 <br /> SUBJECT: Governor Pawlenty's Budget Proposal <br /> The League of Minnesota Cities (LMNC) has provided a summary of the LGA and Market <br /> Value Homestead Credit cuts for 2003 and 2004, as proposed by Governor Pawlenty. This <br /> information can be found on the LMNC website (www.lmncor <br /> The proposal from Governor Pawlenty impacts Elk River significantly. The Govenor has <br /> stated that the cuts represent a maximum of 5% of the total city revenues in 2003 and a <br /> maximum of 9.5% of the total city revenues in 2004. What is not said is that almost <br /> everything is included in the total revenue figure. If you levied taxes to pay bonds, that is <br /> part of the total revenue; if you received state funds for a street project, that is part of the <br /> total revenue. The reality is that the cuts need to come from the General Fund Budget as this <br /> is where the LGA and the Market Value Homestead Credit revenues are located. The <br /> Governor's proposal results in a $644,138 reduction in 2003. This is about an 8.4% cut from <br /> the already approved 2003 General Fund Budget. The proposal for 2004 is a $1,292,865 <br /> reduction in aids. This is a 16.8%reduction in 2004 from the adopted 2003 General Fund <br /> Budget. According to the Govenor's plan, in 2004 we are scheduled to receive zero ($0) <br /> LGA and Market Value Homestead Credit. <br /> Hopefully the final result will not be this severe for the City of Elk River. Additionally,we <br /> can hope that levy limits will not be imposed in 2004 but this seems unlikely and I have <br /> every expectation that some form of levy limits will exist for municipalities in 2004. (As you <br /> most likely know, all of this is in addition to a proposed wage freeze for two years for <br /> government employees, which includes municipalities.) <br /> s/Admin/PaJ/LC4&,s <br />