Providing a non-partisan model for generating and sharing          

    essential information on public issues and proposed solutions              

10th Anniversary :  2005- 06 to 2015-16

   
                                                                                                  About Civic Caucus   l   Interviews & Responses  l   Position Reports   l   Contact Us   l   Home  

 
 Response Page - Salomone  Interview -      


These comments are responses to the questions listed below,
which were generated in regard to the
Dan Salomone Interview of
04-29-2011.
 

Overview

Dan Salomone, Deputy Commissioner, Minnesota Department of Revenue discusses Local Government Aid (LGA) and addresses the following questions:

Should state aid to cities be continued?

Should the aid relate to level of spending and property tax wealth?

Should property tax relief be accomplished by giving cities state aid or by giving it directly to citizens based on income?

Should local non-property taxes be allowed?

Should state aid be limited to certain local functions?

Should aid be contingent on a city's achieving state-prescribed results?

For the complete interview summary see:  http://bit.ly/jsVrUg

Response Summary:  Readers have been asked to rate, on a scale of (0) most disagreement, to (5) neutral, to (10) most agreement, the following points discussed by Deputy Commissioner Salomone. Average response ratings shown below are simply the mean of all readers’ zero-to-ten responses to the ideas proposed and should not be considered an accurate reflection of a scientifically structured poll.

1. Continue aid. (4.8 average response) State aid to cities in Minnesota, which provides comparatively more revenue to cities with higher expenditures and lower property tax wealth, should be continued.

2. Limit to statewide interest. (5.1 average response) State aid to cities should be limited to functions for which a statewide interest exists.

3. Tie aid to results. (5.2 average response) State aid should be contingent on cities' achieving pre-determined results, or outcomes.

4. Direct aid to citizens. (4.1 average response) Instead of holding down property taxes with state aid to cities, the state should provide aid to citizens based on income to help them pay their property taxes.

5. Allow non-property tax levy. (5.9 average response) If state aid is substantially reduced or eliminated, a city should be given authority to levy local non-property taxes.

6.  Forego referenda. (3.9 average response) A city should be allowed to levy local non-property taxes by vote of the city council, without referendum.

 

Response Distribution:

Strongly disagree

Moderately disagree

Neutral

Moderately agree

Strongly agree

Total Responses

1. Continue aid.

29%

21%

5%

18%

26%

38

2. Limit to statewide interest.

19%

16%

19%

32%

14%

37

3. Tie aid to results.

27%

14%

8%

30%

22%

37

4. Direct aid to citizens.

19%

32%

24%

14%

11%

37

5. Allow non-property tax levy.

11%

14%

22%

30%

24%

37

6.  Forego referenda.

38%

16%

16%

16%

14%

37

Individual Responses:

Ray Ayotte  (2.5)  (7.5)  (10)  (5)  (10)  (5)

David Dillon  (0)  (10)  (0)  (0)  (10)  (10)

W.D.(Bill) Hamm  (0)  (0)  (0)  (7.5)  (7.5)  (0)

1. Continue aid. Absolutely not. This is just another nanny state sharing of someone else’s wealth. Worse than that, (it) allows for state manipulation of cities in the program. It is time that cities again stood on their own two feet, although I would support giving them the tools they need to adjust to self support. If a city can't support itself then it should end being a city.

2. Limit to statewide interest. I absolutely oppose the coercive use of state monies toward a state entity with special focus on cities and school districts.

3. Tie aid to results. Right back to coercion; absolutely not.

4. Direct aid to citizens. It is already in law.

5. Allow non-property tax levy. Depends on wording, and although this most likely is aimed at sales taxes. My opposition to (a) sales tax increase remains unaltered due to their regressive nature. The other negative here is that this is merely a way to sidestep increases in property tax by pushing as much of the cost off on rural neighbors as possible.

 6.  Forego referenda. Absolutely not. The Duluth School District grab of a few years back should give us all reason to closely examine this proposal. Put it before the people as a referendum.

Michael Martens  (0)  (5)  (0)  (10)  (0)  (0)

1. Continue aid. LGA should be eliminated.  The current formula for LGA unfairly distributes LGA to different cities (half the cities don't get any LGA). All I ever hear is “my city needs more.”

2. Limit to statewide interest. Please define statewide interest.

3. Tie aid to results. Eliminate LGA

4. Direct aid to citizens. Absolutely. There will never be a formula that can distribute LGA fairly to cities. There will always be winners & losers. If cities get LGA , why don't counties get LGA?    Currently people with the biggest property tax bills get the most benefit fro LGA.    Currently citizens (with) fixed incomes ( mostly seniors) can be forced out of their homes( that have no mortgage) because they can't pay the property taxes

5. Allow non-property tax levy. The more and different fees cities and counties can levy the harder it is to hold them accountable for spending increases. With more and different fees elected officials can play one group off against another

6.  Forego referenda. In medium & large cities there is a loss of contact and accountability between citizens and elected officials.  It is much easier for elected in large cities to raise property taxes than in small towns.

Dave Broden  (10)  (7.5)  (10)  (2.5)  (7.5)  (10)

1. Continue aid. LGA is critical to the quality of life in Minnesota and is also key to maintaining uniformity across all parts of Minnesota. LGA should be redefined so that it is focused to essentials of public safety and health plus a few other applications that should be common. LGA has been abused but that is not the reason to eliminate the benefits of wise funding. To evolve to a mix of quality and slums is not rational and should not be considered at all.

2. Limit to statewide interest. The statement has merit but cannot comment without some detail of what is being defined as statewide interest. Different areas of the state have different needs that may affect key areas.

3. Tie aid to results. Use of metric is always a valid approach as long as it is realistic and can be effectively and uniformly administered without adding personnel to manage the process.

4. Direct aid to citizens. Recommend providing incentive to the cities, not direct aid to the citizen. This needs a well thought out assessment.

5. Allow non-property tax levy. Strongly concur but the ability should be somewhat regionalized to eliminate risk of establishing pockets of tax difference across the state.

6.  Forego referenda. The elected officials must be the decision makers for the level of government; we should not expand the decision making to the citizens.

Scot Pekarek  (0)  (10)  (7.5)  (0)  (0)  (0)

Leigh Lenzmeier  (5)  (2.5)  (7.5)  (2.5)  (5)  (7.5)

1. Continue aid. State aid to local gov't has been reduced, is being reduced, and will continue to be reduced.  Our county now has an informal tool we call flexible budgeting.  To the extent possible, expenditures are put off to the end of the calendar year until we know the impact of unallotments usually in Dec.  The tool has worked so far.  Reduced aid will make this discussion moot.

2. Limit to statewide interest. The determination of "statewide interest" will become very political, just like the JOBS program.  State aids will not be eliminated by some well-considered plan but by state budget needs and expediency.

3. Tie aid to results. Unfunded mandates can be manageable.  What kills local government units are the prescriptive ways these are required to be met.  State agencies, through rule making, develop one-size-fits-all prescriptions claiming this makes it "fair".  Baloney, it just makes it easy for the agency to determine if the mandate is met.

4. Direct aid to citizens. Property taxes are the symptoms not the disease.  Spending/levies drive property taxes.  Folks are complaining right now about falling values & rising taxes.  They are not related.  Any form of aids is going away. There are few other choices.

5. Allow non-property tax levy. I don't know what the ideal level of local gov't services are, but then no one else does either.  Opinions are all over the board.  Local units will continue to do what they can with what they have to work with.  Property taxes are most transparent.  If not for withholding on our paychecks, if we actually had to write checks to the fed & state for the stated amount, folks would pay more attention.  We don't see it so we don't feel it.

6.  Forego referenda. Yup, that’s what elections are for.  If folks didn't like the results, get new office holders.

David Gay  (0)  (0)  (0)  (0)  (0)  (0)

1. Continue aid. These payments allow cities to spend without any accountability to the ratepayers.

2. Limit to statewide interest. There should be no LGA

3. Tie aid to results. There should be no LGA

5. Allow non-property tax levy. Cities should only be funded by local property taxes.

6.  Forego referenda. Any new non-property tax should be temporary and approved by voters. The burden of these new taxes must be born by all residents, not a subset.

Pat Barnum  (2.5)  (5)  (2.5)  (5)  (2.5)  (0)

4. Direct aid to citizens. If citizens choose to live in an area that has taxes they can't afford, they should choose to live elsewhere. Naturally we have created this artificial imbalance, so an easement out of the situation will take some time. But the question is not an either-or. The state should not be in the business of finding ways to ease the tax burden of just some citiziens - it should be easing the tax burden for all citizens by reducing spending.

Peter Hennessey  (2.5)  (7.5)  (2.5)  (2.5)  (7.5)  (0)

1. Continue aid. There are very few cases and reasons why the State should supplement the revenues of cities or counties. As in all discussions about revenues and expenditures, the first step should be to examine the reasons for the expenditures. In almost all cases it turns out to be something that government should not be doing in the first place. So after you've reduced government functions and expenditures to the bare minimum, privatized everything you can, including schools and welfare, end all federal and state mandates, whether funded and unfunded, then we can talk about whether there is still a need for state aid to cities.

2. Limit to statewide interest. What is "state interest"? For example, (is it) as defined in the federal and state constitutions? Of course we know that "state interest" is always defined in terms of ideologies foreign to America's founding principles, in defiance of whatever our state and federal Constitutions say.

3. Tie aid to results. So just how would you define predetermined results and outcomes? Let's see, would you pay cities only if they managed to reduce the welfare load by putting x.x% of the beneficiaries back in private jobs and turned x.x% of the rest back to private charities to be taken care of? Or if they reduced their Medicaid case load by letting x.x% of the elderly die from rationing and denial of medical services, as prescribed in Obamacare? What is your standard of success? Why would a city need any help if they managed to achieve all that by themselves?

4. Direct aid to citizens. Instead of building the nanny-state house of cards higher and higher, why don't you find a way to keep from intruding on and monitoring peoples' lives? Means testing is just more government control and has nothing to do with "fairness." Property taxes are just like the protection racket: pay the money or we come after you with guns blazing. What if we find an alternative to property taxes?    This and all the other questions suffer from a case of failing to define the terms before the discussion starts. State money is not free money created out of thin air; it is money that the state's and the city's residents pay in taxes. Federal money is also not free money; it is money that the country's, the state's and the city's residents pay in taxes. All of these monies come from the same pockets. But the immorality of the subsidy scheme comes to light when people suggest that it is other people's pockets being picked, using not appeals to reason or charitable impulses, but the government's police powers misdirected to the confiscation of privately earned or accumulated property. Government does not create money to dispense to the rabble in the form of all their grandiose welfare schemes; it first has to take it from people who've earned it by working at something productive. So in whatever form we can agree that government should be the benefactor or charitable institution of last resort, a legitimate government would first insist that the intended beneficiary's immediate or extended family, their church or other private charity step in to assume the responsibility.

5. Allow non-property tax levy. Yes, I am always in favor of pushing the decision-making as far down the food chain as possible. What if you eliminated all existing taxes and fees at all levels of government and replaced it with a simple retail sales tax?

6.  Forego referenda. Cities levying their own taxes, yes. No referendum? No. The least you can do is let the victims vote on their punishment. Politicians come and go but taxes stay forever. No "temporary" tax is ever allowed to sunset.

Bradley Peterson  (10)  (0)  (0)  (2.5)  (5)  (2.5)

3. Tie aid to results. Different communities have different needs. How would you measure objectively?

5. Allow non-property tax levy. As noted this would only enhance disparities amongst communities

Anonymous  (10)  (0)  (0)  (5)  (10)  (10)

Don Anderson  (7.5)  (7.5)  (10)  (2.5)  (7.5)  (7.5)

2. Limit to statewide interest. Who determines "statewide interest exists"?

4. Direct aid to citizens. Wouldn't it be better for the city to determine the level of aid than to have the state do it?

Tom Triplett  (7.5)  (2.5)  (2.5)  (5)  (10)  (5)

1. Continue aid. State should revert to a formula limited to "equalization" aid and also eliminate all grandfathers.

2. Limit to statewide interest. If there is to be city aid, it should be usable for any legitimate local purpose.

3. Tie aid to results. I see it simply as a tax base equalization program.

4. Direct aid to citizens. I think there's a justifiable role for both income-assistance and tax base equalization.

5. Allow non-property tax levy. Absolutely.

Ray Cox  (3)  (10)  (10)  (0)  (5)  (0)

I think the most important part of LGA is reforming it to see that it is truly used for intended purposes…public safety…and that measurable outcomes are in place to manage LGA. The expansive growth of LGA in the late 1990’s simply encouraged cities to ‘bloat up’ in an unsustainable and completely unproductive manner.

Chuck Lutz  (10)  (6)  (8)  (1)  (9)  (8)

Clarence Shallbetter  (4)  (8)  (8)  (9)  (5)  (4)

John Milton  (10)  (0)  (5)  (0)  (10)  (10)

3. Tie aid to results.  (This) is heavily dependent on who pre-determines results or outcomes. 

4. Direct aid to citizens. (This)is not practical, since legislature could take away the program, and not all citizens are homeowners nor have sufficient income to pay taxes. 

5. Allow non-property tax levy. (This) presumes that state aid were reduced or eliminated, which I believe would be catastrophic. 

6.  Forego referenda. (This) is another break in our tradition of representative government. I'd be appalled at the results to putting every vote in the Legislature into the system of Twitter-based referenda.

Bert Press  (10)  (0)  (0)  (0)  (5)  (0)

Tom Spitznagle  (0)  (5)  (3)  (8)  (2)  (0)

Robert J. Brown  (0)  (5)  (10)  (5)  (10)  (5)

You can’t discuss LGA without looking also at school aids – the school aid formula is supposedly based on equalization, but if you don’t consider all the state money that goes to a local area you may be over equalizing or under equalizing.

The responsibility of levying taxes and the authority to spend them have been separated with all the intergovernmental payments from high levels (federal and state) to lower (state and local.) This inevitably leads to less well thought-out expenditures. Ideally, the only aids should be based on predetermined formulae for equalization to level the playing field for local units in terms of capacity to provide services, but allowing the locals to determine how to operate based on the needs and wants of their constituents.

Cam Gordon  (10)  (3)  (0)  (5)  (10)  (5)

If LGA is eliminated we need to study alternatives to the regressive sales and property taxes, this need to include a look at local income or payroll taxes as is allowed and done in Ohio, Penn. and other states.

Jerry Fruin  (5)  (8)  (5)  (8)  (0)  (0)

Bill Kelly  (6)  (na)  (na)  (10)  (1)  (1)

Salomone's comments are very good and based on many years of experience.  A strong case needs to be made that Minnesota has a state local fiscal system that is strongly integrated on both the tax side and the spending side.  Therefore the approach needs to be integration not separate paths for the state from local governments.  For example question 2 above a state must have an "interest" in local government and its community because the state permitted the local government to be created.  As such state interest and appropriate oversight is required by the Constitution.  It is a primary reason for the Office of State Auditor.

Tom Swain  (7)  (1)  (5)  (1)  (8)  (5)

Bright Dornblaser  (10)  (5)  (7)  (1)  (1)  (10)

4. Direct aid to citizens. Does not help the lower income renters.  Eliminates local options to use the funds to address locally determined high priority needs.

5. Allow non-property tax levy. Eliminate sales tax expenditures first.

Shirley Heaton  (0)  (5)  (10)  (0)  (5)  (0)

My response is based solely upon my participation in the federal/local urban renewal programs where I had to devise plans, which would enable cities to control devastating blight without going bankrupt. The zeros mean that I think more thought needs to be given the topic, especially #6, as I've never been convinced local government representation has ever performed its job to 'my high standards'.

Carolyn Ring  (7)  (2)  (8)  (2)  (8)  (9)

This is a complex issue that deserves study and action.  With the current budget problems it is imperative that all money be given with ultimate "bang for the buck."

Wayne Jennings  (10)  (1)  (3)  (7)  (10)  (4)

Jackie Underferth  (4)  (9)  (0)  (10)  (10)  (8)

Fred Zimmerman  (0)  (9)  (9)  (5)  (6)  (1)

Arvonne Fraser  (10)  (5)  (6)  (na)  (na)  (na)

I can't vote for 4, 5, and 6 because I have qualifications or questions about each.  On “4. Direct aid to citizens”, that's what the state income tax does so why the "instead of."  On “5. Allow non-property tax levy”, we do that already in specific cases and on “6. Forego referenda”, my answer is maybe, maybe. Taxes are complex questions, though I'm for raising taxes to provide services and benefits to citizens.

David Pundt  (2)  (7)  (8)  (3)  (6)  (0)

An interesting topic with a very knowledgeable man; thank you. I found myself moderating my answers and actually thinking about better ways to govern. My limited experience has been one closer to government handouts with no strings attached than helping a city with no other way out of their financial difficulties. Thanks again.

Terry Stone  (2)  (10)  (10)  (2)  (8)  (0)

1. Continue aid. LGA needs to fade away; accountability in government is best achieved as close to the taxpayer’s wallet as possible. LGA is creating homogeneous cities lacking local character.

2. Limit to statewide interest. State aid should be limited to functions for which a statewide interest exists. Rules for all state expenditures:
• Is this expenditure in the interest of all or most Minnesotans?
• Is this a constitutional expenditure (function) of government?
• If it is a constitutional function of government, is government the best medium through which to perform this function (would privatization be more effective)?
• Is this the best level of government at which to perform this function?
• Can the state afford this expenditure?

3. Tie aid to results. State aid should be contingent upon cities achieving pre-determined results or outcomes in order to provide accountability for all LGA funds. Block grants have fostered colorful spending and contributed to the tragedy of the commons.

4. Direct aid to citizens. Providing aid to citizens based on income to help them pay their property taxes in lieu of LGA property tax abatement sounds like crass redistribution of wealth. When LGA money is replaced with local revenue streams, everyone must have skin in the game; not just property owners.

5. Allow non-property tax levy. If state aid is substantially reduced or eliminated, authority should be cautiously given to cities to collect one or more of Minnesota’s 37 taxes as appropriate.

6.  Forego referenda. A city should be allowed to levy local non-property taxes only by a referendum. The competence of local government varies from excellent to sorely lacking. The power to tax is the power to destroy and the people need to retain the authority to authorize new revenue streams for their local governments.

Al Quie  (0)  (10)  (10)  (5)  (1)  (0)

Roger A. Wacek  (0)  (0)  (0)  (10)  (5)  (5)

Paul and Ruth Hauge  (9)  (8)  (8)  (5)  (5)  (3)

Kevin Edberg  (7)  (7)  (6)  (4)  (7)  (7)

 

    

The Civic Caucus   is a non-partisan, tax-exempt educational organization.   The Core participants include persons of varying political persuasions, reflecting years of leadership in politics and business. Click here  to see a short personal background of each.

   Verne C. Johnson, chair;  David Broden, Charles Clay, Marianne Curry, Bill Frenzel, Paul Gilje,  Jim Hetland,  Marina Lyon, Joe Mansky, John Mooty,  Jim Olson,  and Wayne Popham 


©
The Civic Caucus, 01-01-2008
8301 Creekside Circle #920,   Bloomington, MN 55437.  civiccaucus@comcast.net
Verne C. Johnson, chair, 952-835-4549,       Paul A. Gilje, coordinator, 952-890-5220.

contact webmaster
 

 

 

Hit Counter