Wednesday, January 17, 2018

Changes to the Local Government Fund Considered

The Local Government Fund has been an important and stable source of local government revenue for almost 20 years. Since Fiscal Year 2010, the LGF has seen substantial reductions due to a shrinking state general fund and additional reductions imposed by the General Assembly.
In recent years, members of the General Assembly have been considering changes to the LGF and evaluating how the Local Government Fund is calculated for distribution to cities and counties.

Last fall, the Speaker of the House appointed an ad committee chaired by Rep. Leon Stavranakis to review the revenue needs of municipalities and counties, and modify the current funding methodology of the LGF. 

During its two meetings in late 2017, committee members heard testimony from Melissa Carter with the Municipal Association, other local government interests and Frank Rainwater, the state’s chief economist, to gather input about local government revenue and expenditure trends.

Last week, state budget hearings began with a Ways and Means subcommittee taking testimony about county and municipal requests for funding.

In the 2017 session, Rep. Russell Ott introduced H3099 that changes the formula to reflect the projected growth in the general fund.

Assuring the future of the LGF as a stable and reliable revenue source is one of the Municipal Association’s Advocacy Initiatives for 2018. At Hometown Legislative Action Day on February 6, hear from a panel of House members who will discuss proposals being considered to update the LGF formula.

Read From the Dome to your Home every Friday to keep up with the debate surrounding changes in the LGF. Learn more about the history of the LGF.

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