It's not often that getting $2.3 million cut out of your budget counts as good news, but that was the general reaction Tuesday from Mayor Don Ness, who had feared it would be worse.
At Monday night's City Council meeting, Ness said he expected Gov. Tim Pawlenty to cut far more from cities' local government aid.
"If the governor only cut us $4 million," he said, "I'd be thrilled."
As part of his plan to balance the budget, Pawlenty proposed cutting LGA from cities by 5 percent this year and 11 percent in 2010.
"There are a number of city officials who were, I wouldn't say 'relieved,' but were anticipating it would be far worse," said Jim Miller, president of the League of Minnesota Cities.
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On Tuesday, Ness said the reduction still will be a serious challenge to overcome, "but it is achievable."
"It gives us a chance to address the deficit ... and hopefully allow us to avoid the most serious cuts to services," he said.
Ness declined to provide specifics on how the city would balance the budget, except to say that layoffs weren't likely if the LGA cuts remain as Pawlenty proposed Tuesday.
"If it's significantly more," he said, "then more drastic measures would have to be considered."
That's still a possibility. A new budget report will be released on March 4 that many in the capital say could show a deficit near
$7 billion. Pawlenty's proposal Tuesday addressed a $5 billion deficit.
"This isn't the end," the league's Miller said. "It's the beginning."
The city's budget already was hurt by the state's unallotment, or take-back, of $1.7 million in local government aid at the end of last year. That move brought the city's reserve fund to what Ness said was either a zero or a negative number.
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Erasing the $4 million deficit budget this year could be more difficult than dealing with last year's $6.5 million deficit, Ness said, "because of all the strategies we've implemented and the cost savings we have budgeted for in 2009."
Asked if any city departments would be spared cuts this year, Ness said that's a question being discussed internally. He said he'll present a preliminary report to the City Council on strategies to balance the budget in February.
"We'll have to focus on core services in city government and continue to find ways to let go of services that aren't core to our mission," he said, citing as examples cuts to the senior dining program, the grocery bus, the Washington Center pool and zoo operations.
The affect on local municipalities:
Duluth: $7.5 million
Cloquet: $960,000
Hermantown: $550,000
Proctor: $310,000
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Two Harbors: $430,000
