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House Research Department 3/25/2010 Run: LGAllcutl671conf 2011 LGA, and tota12011 city aid and credit cuts under the HF 1671 conference committee report and the governor's proposal The attached run shows the LGA under current law and under both the conference committee report for HF 1671 and the governor's proposal. It also includes the projected Pay 2011 MV credit cuts, and total aid and credit cuts under each proposal. HF 1671 reduces the LGA appropriation permanently from $558 million annually to $527.1 million annually. The cut is distributed via the formula but the calculation of the caps on minimum and maximum increases for each city remain the same but use 2010 certified aid minus the 2010 supplemental LGA cuts as the starting point from which to calculate allowed increases and decreases. It also makes the governor's January MV credit unallotments permanent. The conference committee also allocates $106,964 of the Pay 2011 appropriation only, to the city of Houston to compensate it for the 2008-2010 governor's unallotments. Houston is the only city subject to unallotments that had a Pay 2008 population less than 1,000. The LGA formula remains the same under the governor's proposal -the differences are only in the appropriation level which is set at $337.6 million, and some differences in how 2011 caps on increases and decreases are determined. For Pay2011: • The minimum aid for cities of 2,500 population or more, is equal to its Pay 2010 certified LGA (before reductions) minus the lesser of (i) $125 per capita or (ii) 50% of its Pay 2010 net levy. • The minimum aid for cities less than 2,500 population, is equal to its Pay 2010 certified LGA (before reductions) minus the lesser of (i) $125 per capita or (ii) 40% of its Pay 2003 LGA. The governor also makes all Pay2010 city MV credit reductions, from both the unallotments, and his supplemental cuts, permanent beginning in Pay 2011. • Column 1: Pay 2011 LGA under current law • Column 2: Pay 2011 LGA under HF 1671 proposal • Column 3: Projected 2011 MV credit cut under the HF 1671 conference committee report • Column 4: Tota12011 LGA and MV credit cuts under the HF 1671 conference committee report • Column 5: Pay 2011 LGA under governor's proposal • Column 6: Projected 2011 MV credit cut under the governor's proposal • Column 7: Tota12011 LGA and MV credit cuts under the governor's prop For further information contact: Pat Dalton 651-296-7434