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Willmar City Administrator Michael Schmit, left, reads paperwork during a Finance Committee meeting in Willmar. Schmit says the city could survive a short delay of several weeks or maybe a little longer in receiving the first of two local government aid payments in the event of a shutdown. Also pictured is City Finance Director Steve Okins. Tribune photo

Willmar could survive short delay in LGA payment if state shuts down

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Willmar Minnesota 2208 Trott Ave. SW / P.O. Box 839 56201

WILLMAR -- The city of Willmar could survive a short delay of several weeks or maybe a little longer in receiving the first of two local government aid payments if the budget stalemate between the governor and the Legislature results in a state government shutdown July 1.

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"It's a concern not only that there might be a delay in payments but sometimes I wonder if the real question is will there be a payment and that's what's really scary,'' says City Administrator Michael Schmit.

Willmar is budgeted to receive LGA totaling $4.48 million in two payments, one in July and one in December. LGA and property tax settlements budgeted at nearly $3.8 million are the city's two biggest revenue sources.

"I think that the City of Willmar is positioned in anticipation of these difficulties to cash flow a short government shutdown period,'' Schmit said Thursday.

The issue might be settled this weekend, however, because Democratic Gov. Mark Dayton and the top two Republican legislative leaders agreed Thursday to lock themselves in a room today and Saturday in a last-ditch effort to agree on a state budget.

"What really concerns me that based on these discussions that are going on: if a compromise of some sort to the budget deficit issue involves further reductions to local government aid. And of course we've been planning for a reduction that equals what the House and Senate agreed to several months ago actually and then the governor vetoed that bill,'' said Schmit.

"So anything over and above that to reach a compromise in St. Paul will mean we have to go back to the existing 2011 budget and look beyond what we're already been planning to cut for some additional ideas.''

But Schmit's hoping a solution will be found that does not adversely affect cities any more than that what's already on the table.

"I've always felt that reasonable people ought to be able to find reasonable solutions to most problems, and politics has become so partisan now that it's not surprising that we've gotten to the point we're at,'' Schmit said.

In St. Paul, the League of Minnesota Cities, on behalf of its more than 830 members including Willmar, filed a response Thursday to the State Attorney General's petition challenging the state's authority to delay or stop local government aid payments should a state government shutdown occur on July 1.

The League said these funds were already part of a budget approved by the Legislature and enacted into law. The response was co-signed by the Coalition of Greater Minnesota Cities and the City of St. Paul.

The Attorney General's petition, submitted on June 13, addressed the temporary funding of core government functions in the event of a state government shutdown. The response co-signers contend that, as dictated by state law, standing appropriations must be paid on schedule.

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David Little
David Little covers the Willmar City Council, Willmar Municipal Utilities and other city news.
(320) 235-1150
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