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7;0--‘- ';,la>VvF' <br />^•V <br />f\‘.- -t, <br />/ <br />/c/ <br />•^: <br />1^'League of Minnesota Cities <br />183 University Ave. East <br />St. Paul, MN 55101-2526 <br />(612) 227-5600 (FAX: 221-0986) <br />rf-? <br />c*.' <br />p-'- <br />mj <br />!->' \ <br />#■ <br />lat, '* ’ ■ ■ <br />hrA.. <br />'V t— ■* <br />-f.A.• <br />ife'% <br />A' <br />■•fr <br />t. '/■: <br />i; <br />l-A <br />L, <br />•7;: <br />ii I <br />■l-'A <br />J?. <br />'A <br />,r '■ ■ <br />t;. <br />A.:-'. <br />V'.: <br />t <br />fv <br />February 25, 1992 ff-3 2 6 <br />TO:Mayors, Managers, and Clerks <br />FROM:Donald A. Slater, Executive Director <br />SUBJECT: 1/2 Cent Sales Tax <br />The purpose of this memorandum is to alert cities to a proposal which <br />could S'* Tiously affec municipal revenue in the suture. <br />The Association of Minnesota Counties (AMC) has circulated a <br />nemorandum to Minnesota county comirissioners proposing that counties <br />consider revoking the 1/2 cent optional sales tax. <br />The memorandum reasons that counties will receive no money from the <br />Xiocal Government Trust Fund for calendar year 1993 and thereafter <br />because the legislat’ e failed to override the Governor's line item <br />veto of the 1991 tax act. The memorandum also states the promises <br />of enacting legislation restorin ; the distribution is not a given and <br />the Governor and the legislature may raid the trust fund to balance <br />the stage's budget. <br />AMC advises counties to remind their legislators and the governor that <br />the counties voted the 1/2 cent sales tax. If the counties don't <br />receive a portion of the funds from the trust fund, there is no reason <br />for the counties to support the tax. <br />Finally, the AMC provides a sample resolution for counties to pass <br />expressing the above sentiments to the Governor and the legislature. <br />It is obvious this move is intended to exert pressure on the <br />legislature and the Governo'* to produce a replacement mechanism for <br />the vetoed portion of the tax act. AMC also seeks to protect the <br />integrity of the Local Government Trust Fund. LMC and AMC share <br />these objectives. <br />However, the threat t revoke support for the trust fund is an <br />extremely serious matter for cities, eLipecially. Without the trust <br />fund, cities, in aiiy county revoking the 1/2 c nt sales tax, would <br />have no local government aid, no housing and agriculture credit <br />assistance, no disparity aid, no anything. The programs which existed <br />before the creation of the trust fund really aren't there anymore and <br />would not be reconstituted if a county opted out of the trust fund.