In a round of executive actions Tuesday, June 16, Gov. Tim Pawlenty exercised his right to unallot funds to balance the state's budget.

The Minnesota Constitution requires a balanced budget, and since the state Legislature was unable to successfully pass one before the close of its session, Pawlenty took up the chance to balance the budget himself.

A total of $2.7 billion was unalloted from the budget, including a $200 million reduction of aid to cities and townships, $100 million reduction in aid to counties and a $1.77 billion deferral of payments to K-12 education.

Pawlenty's budget reductions will take effect July 1.

Following is how they will affect where you live.

CITIES

The forms of city and township aid that will be reduced are Local Government Aid (LGA) and Market Value Homestead Credit (MVHC).

A city's LGA will not be reduced more than 3.31 percent of the city's annual aid plus levy for 2009 and 7.64 percent in 2010.

Townships LGAs will not be reduced more than 1.74 percent of their annual aid plus levy for 2009 and 3.66 percent for 2010.

Cities and townships of less than 1,000 people are exempt from these reductions in state aid.

Pequot Lakes

Pequot Lakes will experience a $43,868 reduction in LGA for 2009. For 2010, the city will experience a 7.02 percent reduction in annual aid with $81,517 coming out of LGA and $28,153 being unalloted from (MVHC) monies.

Pequot Lakes Mayor Nancy Adams said the city had expected the cuts.

"We already cut our budget by 5 percent in January in anticipation of the cuts coming," Adams said.

Sandy Peine, Pequot Lake city clerk, said a property tax increase is unlikely, which means there likely will be cuts to programs, no new programs will be launched, and equipment that would normally be replaced will have to make it a little longer.

"Employees are going to have to be creative. We might have to put things on hold for a year and see where the economy takes us," Peine said.

Nisswa

With a working budget of $2.7 million, and only a small percentage of that coming from state aid, Nisswa Mayor Brian Lehman does not believe his city will be affected much by the budget cuts.

The total LGA and MVHC money that Nisswa would have received from the state is $38,834 for 2009 and $37,568 for 2010. All of that money was unalloted.

That's only around a 1.5 percent reduction in the city's total operating budget.

Breezy Point

Breezy Point does not receive LGA money from the state, but the city did expect to collect around $70,479 in MVHC money in 2009 and $68,571 in 2010.

This money will be reduced by $36,608 in 2009 and $68,571 in 2010.

Mayor JoAnn Weaver said city officials are not sure yet the total repercussions these cuts will have on Breezy Point.

"Change is necessary. The degree of change and the exact manner in which we will that change is as of yet unknown," Weaver said.

Crosslake

Only receiving money from the state from MVHC, Crosslake will experience a reduction of $31,274 in 2009 and $28,729 in 2010.

Tom Swenson, Crosslake city administrator, said the city saw these cuts coming and adjusted the budget accordingly.

"We left a part-timer who we were going to increase to full time at part time. We also didn't renew an animal control contract with the county, and we are also forgoing some other expenditures," Swenson said.

In general, Swenson said he felt the city was going to be able to absorb the cuts coming its way without great difficulty.