Gov. Tim Pawlenty’s unallotment plans were unveiled Tuesday, and Austin is expected to lose $380,012 in local government aid for 2009 — less than originally proposed.

In all, $300 million will be cut from towns, cities, counties and townships the next two years, but Pawlenty said the cuts were “reasonable” and a lot smaller than expected. Pawlenty’s cuts total roughly $2.7 billion, enough to balance the budget, the governor said.

Local government aid to cities will be cut by no more than 3.3 percent in 2009 and no more than 7.6 percent in 2010 — down from January proposals of 5 and 10 percent, respectively. A report from the Coalition of Greater Minnesota Cities has Austin receiving maximum cuts, meaning more than $876,000 is expected to be lost in 2010 on top of the 2009 cut.

Though these cuts are less than originally proposed, the governor said they will still provide challenges for local governments across Minnesota — challenges already realized by many citizens.

“Minnesotans have faced this economic crisis by tightening their belts,” Pawlenty said. “(It’s about) living on a little less for a little while.”

Austin City Administrator Jim Hurm said the city’s budgeting puts them in a position to handle the 2009 reduction. However, he added that getting ready for 2010 will require a lot more work, as there are more variables in play.

He said he wasn’t necessarily surprised to see Pawlenty’s numbers come in lower, but did say he was “pleased” to see them not go higher.

The Coalition of Greater Minnesota Cities called out the LGA cuts in a release, citing several mayors critical of the lost funding.

Mayor Chris Coleman of St. Paul said the cuts will hit close to home, like seeing a library close, for example.

“Many Minnesotans will think in the coming year that this is not the state they knew, or the state they want it to be,” he said in the release.

On top of LGA cuts, higher education will see a $100 million reduction, another number less than previously proposed.

That $100 million will be split evenly between the University of Minnesota and the Minnesota State Colleges and Universities system, equaling reductions of roughly 3.6 percent for each.

Upon hearing the news, Dr. Terry Leas, president of Riverland Community College, said he was relieved the number wasn’t higher.

“Well, it could have been a lot worse,” he said.

Riverland will now have to work with the MnSCU chancellor’s office in determining exactly how the $50 million cut will trickle down to the local level.

Leas said the school is prepared to absorb whatever cuts come its way. In preparation for a tighter budget, school administrators were put on a wage freeze, unions have volunteered to forego pay raises and the equivalent of eight full-time positions were cut, Leas said.

Leas said he thinks Tuesday’s announcement is a good sign for the state.

“I’m assuming (Gov. Pawlenty) recognized the important role higher education plays,” he said.

Health and human services also took a substantial cut of just more than $236 million in the next two fiscal years. Pawlenty admitted the cuts would have an impact, but noted that areas such as hospital service and medical education would be largely exempt from cuts.

The governor is also deferring aid to K-12 schools by roughly $1.8 billion in the 2010 fiscal year, though this is funding that will return later.

To round out the cuts, state agencies will see a $33 million reduction. All in all, cuts total roughly $2.7 billion, enough to balance the budget, the governor said.

The next step in the unallotment process will be for Pawlenty to meet with the Legislative Advisory Commission, as required by law. That meeting will take place Thursday. A finalized plan would need to emerge by July 1, when the new fiscal year starts.

Pawlenty said he knew not everyone would be happy with his plan.

“The criticism is going to come not two years from now, but two hours from now,” the governor said during his 2 p.m. press conference.

Some of the most severe criticism comes, not surprisingly, from Minnesota DFL’ers.

In a statement from associate chair Donna Cassutt, the party said Pawlenty ignored a “responsible, balanced,” DFL-proposed budget and instead worked on his own. The statement goes on to say that Pawlenty and other Republicans “failed” Minnesota.

While those words are harsh, the stiffest challenge could come in the form of a lawsuit — DFL House Speaker Margaret Anderson Kelliher has been meeting with various groups on the possibility, something Pawlenty said he was aware of but not overly concerned about.

“We feel confident in our legal ability to defend this,” he said. “Anyone can file a lawsuit, but it doesn’t mean they’re going to win.”