The situation is bad, but it could have been a lot worse, is the word from City Hall on reductions in state aid.
Though figures are preliminary, Mayor Gary Doty announced Duluth will take a nearly $5 million cut in local government aid. He said it will be painful, but not nearly as bad as previously expected.
"I never imagined I'd be here as mayor saying we just lost $4.9 million and that's good," said Doty. "It's good in one sense, it isn't the $14.1 million that was staring us in the face ... or the $10 million that was staring us in the face."
He credited a well-organized effort to let the governor know that the severe aid cuts originally considered were not acceptable. Doty said the message to Gov. Tim Pawlenty was that the city would not be able to provide certain vital services with the proposed cuts.
"I said all along, we recognize that there is a need to make cutbacks," said Doty. "We recognize there is a budget deficit. But we thought we were taking a disproportionate share of those cuts."
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Doty said the original cuts proposed would have decimated both city and county governments. Indeed, both he and county leaders held meetings on the dire anticipated consequences in the early days of the budget debate.
A report on the effect of the cuts on the county is expected Tuesday.
Doty said Duluth will lose $3.7 million in state aid for 2003. Anticipating this year's cuts, city departments took steps to come up with about $4.85 million worth of spending reductions.
For 2004, the city will lose another $1.2 in state aid for the total of $4.9 million. "Compare that $4.9 million to the $14.1 million that was staring us in the face," said Doty. He credited the local legislative delegation with working hard to minimize the impact.
The mayor even found some good news from the session. Lake Superior Zoo got an additional $123,000 for 2004 from a Department of Natural Resources grant and will get an equal amount in 2005.
The city received a sales tax clarification for improvements to the DECC. It may use the half percent food and beverage tax and the half percent lodging tax to pay debt service on bonds for the Great Lakes Aquarium.
