03-22-1993 Council Packet - Laserfiche WebLink

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TO: FROM: DATE: Mayor and City Council Ron Moorse, City Administrator March IP, 1993 SUBJECT: City's Response to Legislation Concerning the Special Levy to Fund the LMCD Legislation is currently being proposed that would c]imi.iate the limitation on the special levy cities can use to fund the LMCD. The special levy for city funding of the LMCD was put in place to provide a method for cities to fund the LMCD. The legislation which created the LMCD provided cities with a special levy authority to enable them to fund the LMCD outside of the cities' general levy limits. The special levy authority was limited to .00242 percent of taxable value. Although the statute gave the LMCD authority to set their own budget the limit on the special levy served as at least a defacto limit on LMCD spending. It was probably conceived as a limit on LMCD spending by both the cities and the Legislature when the statute was first passed. The proposed bill is now intended to clean up technical issues created when the general levy limits on cil were eliminated. When viewed in terms of the elimination of general levy limits, the legislation makes sense since a special levy authority is not neeaed if there is no longer a levy limit. However, from the perspective of eliminating at least a defacto spending limit on the LMCD, the City of Orono has a major concern with the legislation. The ToMCD governing board is appointed, not directly elected, and so is not directly accountable to the citizens or to the cities which make up its membership. Yet it has the authority to set budget levels and to require cities to provide funding at those budget levels subject only to review by the cities n_Qt approval by the Cxties. It is important that as the levy limits are eliminated and along with then any indication of a reasonable level of funding to be provided to the LMCD by cities, they be replaced with a limit on the amount of funding the LMCD can require from cities. Otherwise the LMCD, an un-elected body, would have the ability to demand an unlimited amount of funding from cities subject only to 3/4 of the cities becoming sufficiently upset to vote to disband the organization. A simple way to do this is to replace the .00242 percent levy limit with a .00242 percent limit on the amount of funding to be reqpair*- from cities. Some flexibility could be added to this limitai ior by allowing the LMCD to request funding beyond the limit upon ap;roval by 3/4 of the member cities.