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<br /> . the Community Rehabilitation Fund to assist cities to design programs to meet <br /> . the local need for affordable single and multi-family housing; <br /> . the Homeownership Assistance Fund to provide for downpayments for low and <br /> moderate income families to purchase their own homes; <br /> . technical assistance to cities to analyze local housing conditions and the need for <br /> incentives, set-asides or other methods to encourage development of housing to <br /> serve employers contemplating business expansion or construction of new <br /> facilities and increasing employment opportunities; <br /> . credit enhancement assistance offered by the Minnesota Housing Finance Agency; <br /> . construction financing assistance to encourage local lenders to participate in <br /> family housing development, <br /> IMPROVING FISCAL FuTuREs <br /> FF -1. Local Government Aid <br /> . Problem: Despite the 1991 dedication of sales tax revenue to the Local Government Trust <br /> Fund, subsequent legislative actions substantially reduced the revenue available for increases <br /> in city property tax relief programs such as LGA and HACA. Although the LGA inflation <br /> index established by the 1994 legislature will ensure modest growth in the LGA <br /> appropriation, it will only maintain the program at a constant dollar level. This will not <br /> reverse the trend toward increased city reliance on the property tax and rapid property tax <br /> growth. <br /> Solution: The implicit price deflator index should continue to be used to maintain LGA <br /> at a constant, inflation-adjusted level. In addition, lawmakers should provide <br /> additional state resources for further increases in LGA to reverse the rapid growth in <br /> the reliance on the property tax. <br /> FF-2. HACA Growth <br /> . <br /> Problem: Homestead and Agricultural Credit Aid for cities does not increase as -the number <br /> of benefited properties increases. As a result, property tax relief for new parcels is actually <br /> provided by shifting taxes to other property owners. In addition, the property tax relief <br /> provided through HACA is not adjusted to keep pace with inflation. <br /> . Solution: The household growth adjustment should be reinstated and an inflationary <br /> 1995 City Policies 15 <br />