Yesterday I proposed a budget for Minneapolis for 2013 that makes significant investments in strong roads and safe streets, as well as in supporting middle-class housing, growing the economy and closing the racial jobs gap. This is the core work of Minneapolis city government and the work we will continue to invest in. But we can only keep doing it if we keep reforming services to deliver them more effectively and with greater value, and the budget I proposed does that as well.
We are able to deliver these investments with a 1.7% increase in the property-tax. Because this increase is below the rate of inflation, and because commercial properties will shoulder more of the overall tax burden in 2013, at least 70 percent of Minneapolis homeowners should feel no increase — or will even feel a decrease — in the City portion of their property taxes next year.
Now any increase is a burden, but I want to be clear: this 1.7% increase is half of what it would have been if we had not passed the Vikings stadium deal, which gave Minneapolis full control for the first time of hospitality taxes that help reduce the burden of Target Center on our property taxes. Once again, I thank Council President Barbara Johnson and Council Members Kevin Reich, Diane Hofstede, Don Samuels, Meg Tuthill, John Quincy and Sandy Colvin Roy for their vote to reduce pressure on property taxes for years to come.
Investing in safety
I’m proposing to add $2.5 million to the Police Department budget to convert existing community service officers to sworn officers, hire new community service officers and begin a new recruit class of new officers in early 2013. The goal is to have 10 more officers on the force by next summer, which is the time of year when we need them most.
I’m also adding $1.1 million to hire firefighters so that the Fire Department — which an independent study just called efficient and well operated, with excellent response times — can prepare for expected retirements. We will also start a new recruit class of firefighters in 2012.
Investing in infrastructure
Minneapolis is in year one of a five-year, ramped-up investment in infrastructure that I announced in last year’s budget address. This level of investment follows the end this year of the five-year Infrastructure Acceleration Program that has improved an additional 104 miles of streets.
As a result of this heightened investment, in 2013, we will be investing 300% more in improving streets and other infrastructure than we had previously planned. We can do this because we have paid off so much debt and restored our AAA bond rating.
But we don’t just spend money on roads, we save money, too. Next year we will spend $100,000 less on salting our roads during winter because we invested in spreaders that do it smarter. This isn’t just good for the bottom line: because we will spread 5,000 fewer tons of salt on our roads this winter, it’s good for our lakes, rivers and creeks, too.
The biggest reform that I’m proposing is to reorganize the Department of Regulatory Services by moving business-related functions to our economic-development department and environmental services to our health department, concentrating the remaining functions in a new inspections department. This will save $300,000–400,000 next year alone, and will send the message to our vibrant businesses that Minneapolis is here to grow your business, not slow your business.
Tackling tough financial issues
These kinds of investments are only possible because of the hard work we have done over the past decade to restore the City’s finances and tackle some heavy financial burdens we once faced.
- Paying down debt. Ten years ago, we inherited a city in a financial crisis with a maxed-out credit card. Since then, we have paid down or avoided $241 million in debt and restored the City’s AAA credit rating.
- Reforming pensions. After years of effort, last year we succeeded in reforming several closed-pension funds whose taxpayer-funded obligations were exploding. In 2012 alone, this reform saved Minneapolis property taxpayers $20 million. And I’m proud to say that in 2012, Minneapolis will also retire all its pension debt.
- Holding the line on wages. Some politicians, like in Wisconsin, are quick to attack hard-working public employees, but in Minneapolis, we’ve partnered with them. Over the years, we’ve worked together to save healthcare costs without sacrificing quality and hold the line on wages, which has allowed us to save jobs and hold down property-tax increases.
Had we not tackled these financial issues head-on, Minneapolis taxpayers would be paying 35 percent more in property taxes in 2012 than they currently are. Tackling these issues has been the right thing to do.
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