State Auditor Blaha Releases 2020 Town Finances Report -- December 16, 2021

Saint Paul, MN – Earlier today State Auditor Julie Blaha released the 2020 Minnesota Town Finances Report which details the financial operations of Minnesota townships. “This is an unusual year, but numbers make sense when you consider COVID-19,” said Auditor Blaha. “We should think of this as an anomaly and not an actual trend.”

The 2020 Report shows revenues, expenditures, and debt service increased over 2019. “Township road and bridge expenditures slowed from the previous year, while the focus shifted to public safety and day-to-day activities to address the pandemic,” said Blaha. “This is the first year showing the effect the pandemic has had on Minnesota townships.

Expenditures on debt service (principal, interest, and fiscal charges) rose more than 26 percent over the amount reported in 2019. “The increase in debt service makes sense given the rising long-term debt of townships, and some towns taking advantage of lower interest rates to refinance existing debt,” added Blaha. Auditor Blaha noted that long-term debt grew to $72.0 million in 2020, which represents an increase of 13 percent over 2019.

Total revenues were up more than 13 percent in 2020, while expenditures increased only 1.7 percent. Among the factors driving the growth in revenues were federal grants, which increased almost 432% over the previous year. Two federal grant programs, the Coronavirus Aid, Relief, and Economic Security Act (CARES) and Federal Emergency Management Aid (FEMA), were largely responsible for the increase in 2020. For expenditures, 2020 data reveals a tangible shift in the amount and nature of spending. In 2020, expenditures on general government, fire and all other public safety went up while roads and bridges including capital outlay decreased from the previous year.

Current Trends

• In 2020, Minnesota towns reported total revenues of $380.8 million. This amount represents a 13.8 percent increase over the total revenues reported in 2019.
• Minnesota towns reported total expenditures of $360.3 million in 2020. This amount represents an increase of 1.7 percent over the amount reported in 2019.
• Towns had debt service expenditures of $13.3 million in 2020. This amount represents an increase of 26.7 percent over 2019.
• Outstanding indebtedness totaled $72.0 million in 2020. This represents an increase of 13.1 percent over 2019. Outstanding bonded indebtedness totaled $50.7 million in 2020, which represents an increase of 18.8 percent over the $42.7 million outstanding in 2019.

Ten-Year Trends

• Between 2011 and 2020, total town revenues in actual dollars increased 40.5 percent. In constant, or inflation‐adjusted, dollars, total town revenues increased 17.7 percent during this ten‐year period.
• Since 2011, the share of total revenues derived from taxes decreased from 72.6 percent in 2011 to 66.2 percent in 2020, and the share of total revenues derived from intergovernmental sources increased from 17.8 percent to 26.0 percent over that same period.
• Between 2011 and 2020, total town expenditures in actual dollars increased 36.4 percent. In constant, or inflation‐adjusted, dollars, total town expenditures increased 14.3 percent during the ten‐year period.

View the complete report, which includes an Executive Summary, graphs, and tables.