Mayor Rybak Unveils City Budget Focused on Jobs
Putting people to work, protecting safety, improving transportation are priorities
August 13, 2009 (MINNEAPOLIS) -- In his annual Budget Address today, Minneapolis Mayor R.T. Rybak unveiled a city budget that was focused on getting people to work and helping businesses to grow at a time when many families and businesses are hurting.
"These are no ordinary times and this is no ordinary budget," Mayor Rybak said. "In tough times this city has invested in jobs, safety and public infrastructure. We are showing that smart investments, tied to fiscal restraint, can continue to make this a city of opportunity."
"Change is inevitable, but progress is optional," Mayor Rybak said. "Today, with this budget, we choose progress. The budget I am proposing protects our priorities with an honest, balanced, long term strategy that cuts spending, reforms government, and invests in our future."
Helping Businesses Grow, Helping People Find Work
Mayor Rybak said that the state of the national economy required the City to remain focused foremost on putting people to work and helping businesses grow. Towards this end, the Mayor proposed increasing funding for two key efforts he said were already showing results:
• $4.3 million to expand the Great Streets program that provides innovative and unique low interest loans and financing tools to help small businesses develop and grow. This would include funds to help businesses acquire and redevelop property, expand their business, or improve their storefront.
• $1.2 million to help more adults find and get quality jobs through the City’s Workforce Centers. Minneapolis is one of the few cities in the country that coordinates its own Workforce Centers, and these Centers have helped 60,000 people last year to brush up their resume or acquire new job skills. Since 2002, the City has helped directly place 10,000 people into jobs.
Mayor Rybak says that efforts like these are paying off and are a chief reason why unemployment in Minneapolis has been lower than in the rest of the metro region, the state and the nation.
Protecting Public Safety and Public Infrastructure
Mayor Rybak said that strengthening the economy also meant continuing to make progress on making Minneapolis safer and improving the City’s transportation infrastructure.
"Minneapolis is a safer city today than it has been in many years," Rybak said. "We fought crime head-on and are delivering results. Crime in our city is falling for the third straight year and is at the lowest level in nearly a decade. Violent crime is the lowest in eight years and the homicide rate is the lowest in 25 years. This reduction wasn’t easy and it wasn’t by accident."
"Skimping on transportation infrastructure isn’t an option," Rybak said. "That’s why my budget continues to accelerate funds for road maintenance and bridge repair. Cutting spending on infrastructure doesn’t save money – only borrows it from the future, passing an even larger problem onto our kids."
Serious fiscal challenges face Minneapolis
• Recession – Although unemployment is lower in Minneapolis than is the case nationwide, the serious downturn in the national economy negatively affects property values, pension funds and the state budget – all of which hurt the City’s bottom line.
• State cuts – Funding for Minneapolis has been cut by more than $40 million during 2009-2010. That’s on top of the $49 million that Minneapolis has been cut by the state since 2003. This is in spite of the fact that Minneapolis already sends more to the state than it receives.
• Health care – Minneapolis will spend $48 million on health care this year, compared to $220 million on wages and salaries. At current growth rates, health care and wages will be equal within 15 years.
• Pensions – City pension costs total $25 million in 2010 and will climb to $52 million by 2014. People who worked hard for this city, and their families, deserve what they have earned, but the system is broken and the pension plans and the City both need the legislature's help to fix this broken system.
• Tax base "rollercoaster" – $26 million in property tax revenue from downtown buildings will shift onto the City’s total tax base for one year before shifting off, potentially causing wild swings in property taxes.
Rybak’s fiscal solution: a balance of cuts, reform and taxes
"We will have to do many things: First, and most important, we will cut spending. Second, we will continue the reforms that helped us deliver results to our residents, even with fewer resources. Third, we are going to ask the residents of Minneapolis to invest in a long term plan that tackles our problems head on, and asks for sacrifice this year to make it better in the years to come."
Cuts to spending – Mayor Rybak has proposed $19 million in cuts to the City’s $371 million general fund. In all, total City spending will drop $100 million for a total budget of $1.31 billion. Every city department is being cut, although the largest departments (police, fire, and public works) are seeing the smallest cuts as a percentage of their budgets. Rybak urged all city employees to "look under every rock" to find cuts big and small and they did, including:
• Consolidating cell phone plans to save $120,000 in Police and $81,000 in Regulatory Services.
• Providing thick budget books online only instead of print to save $40,000.
• Decreasing its car fleet by 15 cars saves Police $370,000.
• Installing LED traffic lights to save Public Works $30,000 in electricity costs.
• Eliminating a Health department newsletter to save $2,000.
• Reduced staff training in the Human Resources department to save $17,000.
Reform – Mayor Rybak proposed a significant reorganization of the police department that will streamline management, eliminate supervisory positions, put more officers into precincts, reduce special units, and promote collaboration across divisions. Police overtime has also been reduced by 38%, resulting in a savings of $1.7 million – the equivalent of 17 police officer positions.
New revenue policy – Mayor Rybak proposed an increase in property tax revenues that will result in a 6.6% increase in property taxes on the average Minneapolis home. More than 60% of the proposed tax increase is solely to pay for the city’s skyrocketing pension bills. The rest of the increase, along with spending cuts and reforms, will be used to replace state cuts.
Visit www.MayorRybak.us to view more information about the 2010 City of Minneapolis budget, including Mayor Rybak’s Budget Address te xt and slide presen tation.
Published Aug. 13, 2009