Local governments spent $8.3 million lobbying in ‘14

Local governments need state government for direct aid, tax breaks and capital investment. State government needs local government to function as the liaison between citizens, businesses and the state budget.

Lobbyists need both, and especially need for them to continue needing each other.

Minnesota’s local governments combined spent nearly $8.3 million on lobbying in 2014, slightly higher than the comparable figure in 2013, according to a new report from the Office of the State Auditor.

As could be expected, the biggest single players in the local-to-state relationship are the various coalitions and interest groups that pool resources from dues-paying members. But in even-numbered years, when larger bonding bills are expected to be on the agenda, cities and counties might sometimes find themselves at odds as they seek funding for construction projects that could come at the expense of another town’s wish list.

The state’s biggest city easily outpaced other individual units on its spending last year. Minneapolis reported a total outlay of more than $450,000, including both its dues to member organizations and individual lobbying efforts. The city’s $290,000 in individual expenses ranked it first among local entities, followed by Hennepin County’s $273,000 and $182,000 spent by the city of St. Paul; coming in sixth was the Minneapolis Park and Recreation Board, with about $143,000.

That spending paid off more than tenfold, as measured by return on investment. Minneapolis was among the big winners in the 2014 bonding bill, receiving $21.5 million for the remodeling of Nicollet Mall and another $8.5 million to renovate the Walker Art Center’s Sculpture Garden.

Minneapolis employed four full-time, in-house lobbyists during the year, and spent a smaller amount retaining firms to supplement its advocacy. Use of on-staff lobbyists is a relative rarity among local units: Just 14 out of 91 reporting government entities were serviced solely or in part by their own internal team, with the 77 others hiring outside firms.

Among associations that represent the combined interests of local governments, the Coalition of Greater Minnesota Cities (CGMC) remains the reigning champion of lobbying expenses, with $720,000 reported during 2014. That beats out the League of Minnesota Cities (LMC), despite that organization’s membership ranks including Minneapolis and St. Paul. The LMC reported $630,000 worth of lobbying from last year, well ahead of third-place finisher the Minnesota School Boards Association ($382,000).

CGMC executive director Heidi Omerza said she was “very proud” of that group’s progress last year. Both CGMC and LMC lobbied to get some of the state’s existing surplus added to the local government aid (LGA) formula, and a supplemental budget passed in 2014 eventually added nearly $8 million to the base-level LGA fund.

LGA is a critical part of budgeting for small towns like Ely, according to Omerza, who serves as a city council member there; in a given year, up to 85 percent of that city’s total budget might come from state aid.

Omerza also pointed to successes for both broadband funding, which received $20 million in 2014, and the “Corridors of Commerce” transportation fund, which took in another $10 million last year on top of its $300 million pool in 2013.

Transportation needs are a perennial and near-universal issue for local units, according to LMC lobbyist Gary Carlson, whose various members wanted new money for roads, bridges, transit and maintenance.

“You may recall how severe that 2013 winter was,” Carlson said. “We had a lot of cities looking at bills piling up for infrastructure and repair.”

Efforts to find new transportation revenues were about as successful in 2014 as this year — which is to say, not at all — but the League did find acceptance of another priority, as it sought to “clean up” a sales tax exemption passed in 2013. That exemption removed taxes on cities, counties and other units, but had been perceived not to include joint powers agreements between units.

Last year, legislators agreed to include those entities in the exemption starting in 2016, though, as Carlson points out, the education bill from the 2015 session — passed, but subsequently vetoed by Gov. Mark Dayton — would have bumped the effective date back to the beginning of 2017.

Carlson also credits LMC lobbying in 2014 for putting tax increment financing (TIF) for workforce housing projects “on the radar,” with a pair of pilot projects allowed in one of that year’s tax bills. This year, taxes seem unlikely to resurface as part of the special session, though Carlson notes both the House and Senate tax bills had language to expand TIF districts for workforce housing.

The Association of Minnesota Counties, which spent a total of $174,000 lobbying last year, purposely does not distinguish between or rank its priorities before the session, according to executive director Julie Ring. AMC arrives at its priority issues after an extensive policy review, and its governing board whittles down a larger list of suggestions to reflect what they see as most likely to get serious consideration during the session.

The group’s 2014 scorecard found the year a hit-or-miss affair for AMC. Counties scored a “win” on a bill to simplify and streamline eligibility determinations for public health service programs. That bill, arrived at through almost a year of negotiations with the Department of Human Services (DHS), was almost a sure thing, as seen by the fact that its four authors in the House and Senate each chaired one of the health and human services committees.

On another front, AMC was less successful. The Minnesota Accountable Government Innovation Collaboration (MAGIC) Act is, Ring admits, a “fairly lofty policy proposal” that nearly lives up to its acronym.  Under the form pushed in 2014, counties would have been granted license to carry out pilot programs to test new approaches toward currently mandated duties. The 2014 version was a scaled-back presentation of the bill, which, in previous years, would have allowed counties to exercise any powers that were not strictly prohibited in state law.

Neither idea got much traction, and, indeed, AMC’s members and board opted not to include the MAGIC Act as one of its 2015 priorities, though Ring said the capital — both political and financial — was not misspent.

“We’re constantly trying to talk about how we can reform government, and think differently about local responsibilities,” she said. “The MAGIC Act was our way to talk about that.”