Another warning bell on cities and their money

Different set of numbers, same warning bell for Minnesota cities.

The League of Minneseota Cities on Thursday trotted out a Humphrey Institute analysis it commissioned, declaring that cities all over Minnesota will be broke in five years. The analysts took recent trends in city revenue and spending, extended them into the future and concluded that by 2015, cities of all sizes and locations will be in the red.

Since that can’t happen under statute, what it means, of course, is a round of tax-raising or expense-cutting between now and then.

The Strong Towns blog did a related analysis recently looking simply at what would happen to city budgets it the state’s local government aid goes away.

The league’s analysis leans heavily on the expected continuation of lower local government aid but also notes that regardless of what happens to that LGA aid, all cities see community pressure for spending and service increases — driven by an aging population, for example — and tax cuts — driven by residents struggling in a weak economy.

The league’s report, at four pages almost a back-of-the-envelope calculation, notes that pain will be felt across the board, from Minneapolis to regional centers to towns under 1,000. It doesn’t analyze how cities differ on how they tax and spend or how well they deliver service, and it stops short of framing how residents might come to grips with the looming dilemma.

It’s pretty easy to imagine scenes of shouting in city council chambers and frustration or even desperation at the mailbox when tax statements come out. Likewise doctrinaire positions staked out by elected officials and city residents.

This seems like a ripe conversation in the making. Do people start by talking about what services are most important? About what level of sacrifice is called for? About how well service is delivered by cities? About who is successful and why? I keep thinking about gravel roads.