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00 LEAGUE of CONNECTING & INNOVATING MINNESOTA SINCE 1913 CITIES State of the Cities 2019 Introduction The League of Minnesota Cities sent the fiscal conditions survey to chief appointed officials in all member cities late last year. We received responses from 195 city officials representing 24 percent of member cities. The fiscal conditions survey contains versions of questions used by the National League of Cities. This marks the 16th year that Minnesota cities have responded to the survey. The share of cities with positive outlook on their fiscal conditions increased slightly. Most city officials who responded said their city was better able to meet needs in 2018 than in the previous year. This closely echoes the trend reported by the National League of Cities. Its survey revealed that 73 percent of city finance officers reported improved circumstances in 2018. Among midwestern cities that responded to NLC, only 62 percent of them said"better able." The authors suggest that the lack of increase in the share of cities saying "better able" combined with a trend of revenue growth slowdowns signals that cities are nearing the limits of fiscal expansion. Among Minnesota cities, there was a decline in the share of cities maintaining a positive outlook when thinking about the future. Trends to note • Almost three-quarters of Minnesota city officials responding to the survey (72 percent) said they were better able to meet needs in 2018 than in the previous year,but a smaller share (59 percent)predict favorable circumstances in 2019. Ability of Minnesota cities to meet financial needs, 2015-2019 (predicted) Better Better able Prediction: Better able able to to meet better able to meet Better able to meet needs in to meet needs in meet needs in needs in 2018 needs in 2015 2016 2017 2019 Number of cities 213 242 185 141 115 Share of cities 67% 67% 66% 72% 59% • Fourteen percent of city officials responding indicated that they predict 2019 to be about the same as 2018 in terms of fiscal health. • Infrastructure needs featured among the reasons for some concern about the future. Comments from cities: "We have some pressing needs for wastewater infrastructure so how that turns out will determine our financial wellbeing." (city of 1100) "Significant infrastructure maintenance is a large factor in budgeting demands" (city of 1200) 145 UNIVERSITY AVE. WEST PHONE: (651) 281-1200 EAx: (651)281-1299 ST. PAUL, MN 55103-2044 97 TOLL FREE:(800) 925-1122 WEB:WWWLMC.ORG