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LEGISLATIVE UPDATES ? As the first year ofthe fiscal biennium, the pdmkiy focus of the 2021 Minnesota legislative session.would typically have been the development of the state's fiscal year (FY} 2022-2023 biennial budget. Positive news:on the state's budget forecaatentering the session, with projections for the end of�the-FY 2020-�O2.I biennium improving from a $2.4 .pillion shortfall predicted in a May 2020 :special pandemic. budget projection to a $940.0 million. surplus predicted in the February .2621 budget acid economic forecast, was expected to ease the..budget.process and relieve.the.pressure to make budget.cuts during -an already uncertain time. However, given the significant events of -the preceding year, including the :COVID-19 pandemic and death of George Floyd, the focus of the. regular session shifted to legislation responding .to the pressing issues. that resulted from those events. The business of setting. a .biennial budget was ultimately not addressed until a Juice special session that ended in the early morning hours oj'July 1 st. The following is. a brief summary of legiislativo changes from the 202.1 session or previous legislative .sessions:potentially impacting Minnesota cities. American. Rescue Plan (ARP) Act — The federal ARF Act, signed into law in Mareh.2021, provided federal economic recovery lending for federal, state,. and local government responses to the .COVID-1.9 pandemic. Minnesota local governmentsreceived approximately. $2.1 billion in funding under the ARP Apt, including $644.0 trillion awarded to 21 large cities Cover 50,00.0 population) and $377.0 .million awarded -to. cities. and towns with a population below 50,000, with half distributed in FY 2021 and. half, in FY 2022. Local .governments can use ARP Act funding in four .broad categories: responding.to publichealth and ecohomicimpocts; providing.premium pay to essential workers;. providing general government services to the. extent :of revenue. loss; or investments in water, sewer, and broadband infrastructure. Potential State Aid Enhancements -- The 2021 Legislature increased state general fund base spending by approxiinately.$1.3 billion. rncluded are funding increases for severaTprograms potentially of benefit. to Minnesota cities, including: • A one-time appropdation.of $5.5.million for suppletnetrtal aid to cities for FY.2022, to offset losses. of local government aid (LGA)for 96 cities under the. currontformula. It is expected the Legislature will review and consider updating -the LGA formula!during.the 2022 session. • Annual appropriatiohs-of $1.8 million for the Greater Minnesota Business -*Development Public Infrastructure Grant Program, intended to bolster local economic :growth by providing grant assistance to cities for public. infrastructure needed to create and retain jobs.. • Annual appropriations of $2.5 million for local community childcare grants,iitltendted to assist local communities to increase the number of childcare providers tasupport.economic development. • Allocating a total of $70.0 million from the state'sARP Act funds over the biennium ($35.0 million per year) to fund the Border -to -Border Broadband Grant .Program, which. provides grants to local governments for enhancing broadband availability. • Annual allocations. of $4.5 million for reim.bursements.talocal. governments for firefighter training and education costs. • Annual allocations of $2:9 trillion for reimbursement to local governments. for peace- officer training costs. • A one-time appropriation=cif $18.0--million.for FY 2022: to the small cities'assistance:account to provide additional road repair funding for eiti.e§.under 5.,000 population. Truth-in-Ti msitiion Changes —Effective for property taxes payable in 2023 :and thereafter, county auditors will be required to prepare a new statement:for inclusion in its parcel -specific truth -in -taxation notices that contains summary budget information for.thecounty, cities, and. school. districts. for which they spread and: collect tax levies. Cities with a population greater thaii:500 will 'be required to compile and provide -current and proposed summary budget informatioti to the.county auditor, based on the summary budget information cities are required to submit each yeaf-trl.the Minnesota state auditor. -17-