No property-tax increase for 2012

Today, I proposed a City budget for 2012 with no property-tax increase.

That’s right: no property-tax increase. We will raise the same amount of property-tax dollars that we raised last year. No more.

My budget also meets two urgent needs: improving our streets and closing the racial jobs gap. And it continues to fund the public safety that we deserve, with no layoffs in the police department and no elimination of firefighter positions.

When I think about the iconic image of Minneapolis, I don’t think about the Mississippi Riverfront or Minnehaha Falls, as great as those places are: I think about our miles and miles of middle-class neighborhoods. Minneapolis is nearly unique among American cities in the continued strength of neighborhoods like these.

I grew up in one of those neighborhoods, and I know that what the people who live there expect of City government is pretty straightforward: they want a safe, livable neighborhood in a vital city with good public services and affordable property taxes, and they want their leaders to work cooperatively and pragmatically. In short, they want a City That Works.

To build a City That Works, a city government needs to do two things well: control spending and taxes and make the right investments, even when the state and federal governments are in fiscal turmoil. That’s exactly what my budget for next year does.

Minneapolis is a City That Works because we manage our resources well. We have a 10-year record of fiscal responsibility that includes:

  • budgeting without relying on gimmicks or shifts,
  • spending 8% less than we did 10 years ago,
  • bringing down the number of full-time positions by 10%,
  • paying down $183 million in debt,
  • and restoring our AAA credit rating.

I’m proud of this record of responsibility — and few other governments can match it.

But the blemish on that record has been property taxes. They’re simply too high and we’ve worked hard to hold the line on them.

The first way that we’ve held the line has been by watching our own spending. It will rise next year by only one percent — and that’s after our healthcare costs will rise by four percent.

We’ve also fought against short-sighted cuts by the State Legislature to Local Government Aid, proposed a new funding mechanism for Target Center and secured a merger of our closed pensions with the State system.

As a result of this hard work, I am proposing no increase in the property-tax levy in 2012.

Holding property taxes flat next year comes at the cost of many, many cuts around City government. But it’s all the more important to make them and not pass a property-tax increase because the Legislature very quietly passed on a direct tax increase of its own when it eliminated the Market Value Homestead Credit. Many Minneapolis homeowners will see their taxes rise as a result of this move, which I applaud Governor Dayton and Minneapolis legislators for opposing.

Minneapolis is also a City That Works because we invest in the common ground that helps everyone succeed. This has several components:

  • I propose expanding the City’s street-improvement program by 60% over the next five years. This program will lead to better streets, fewer potholes and fewer car repairs — and it is only possible because we have paid down debt and restored our credit rating.
  • We have brought down violent crime, including youth violence, to record lows, and I will continue to fund the Police Department with no layoffs.
  • In addition, my budget proposes no layoffs or position eliminations of firefighters, though we must keep controlling overtime costs.

Minneapolis is also a City That Works because we invest in putting people to work. We’ve shown that we know where to invest to help grow the economy — but shamefully, Minneapolis still has one of the largest racial jobs gaps of any large city in the country.

  • Therefore, I am proposing a new “One Minneapolis” initiative to train and place hard-to-employ residents—particularly from the African-American community, where the gap is largest — in good, growing, green-economy jobs.

Successful cities — great cities — know how to reinvent themselves. Minneapolis was once just a village on the edge of the prairie that became an international economic powerhouse and the Milling Capital of the World, and now is reinventing itself once again.

City government can’t do it alone, but when we manage our resources well, invest in the common ground that helps everyone succeed and invest in creating jobs for everyone in our economy — in short, when we are a City that Works — we will help our city meet the needs of a new world.

P.S. To read the text of my budget speech, “A City That Works,” go here. To view the slides that accompanied the speech, go here.

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