Council approves 2014 City budget with first levy decrease in 30 years
On Wednesday, Dec. 11, the Minneapolis City Council passed a 2014 City budget, which Mayor R.T. Rybak first proposed in August, that features a one-percent cut to the property-tax levy, the first such decrease in 30 years.
That property-tax cut is 3.8 percent below the cost of maintaining City services at 2013 levels, even before making any new investments.
The 2014 budget will mark the third City budget in a row in which nearly 70 percent of residential taxpayers will see a decrease, or no increase, in their property taxes. In 2014, 67 percent of Minneapolis taxpayers will see a decrease in their property taxes.
The 2014 budget also makes important future investments in:
Responding to a “silver tsunami” of impending retirements by hiring and training a diverse new workforce for the City of Minneapolis, especially in the Police and Fire Departments;
Improving public infrastructure, including significant road, transit, bike and pedestrian improvements, and $4 million for preliminary engineering for the Nicollet–Central modern streetcar project;
Greening the city to meet the challenges of climate change; and
Growing jobs, housing and population in Minneapolis.
The 2014 budget also makes a significant investment in a staged rollout of body cameras for Minneapolis police officers, pending policy and procedure decisions.
The ability to cut property taxes in 2014 while making investments in the future is possible for three reasons:
Earlier this year, Governor Mark Dayton and the Legislature restored some of the decade-long cuts to local government, providing Minneapolis with $12 million more in Local Government Aid.
Also earlier this year, Mayor Rybak and the City Council created a Property Tax Relief Fund with money that the City saved in 2012.
Thanks to the stadium legislation, revenues from sales and hospitality taxes that the City now controls and may use for economic development are growing twice as fast as estimated in a recovering economy.
These recent developments come on the heels of tough choices that City leaders have made over the past decade to restore the City’s fiscal health:
Watching spending, with the City of Minneapolis spending 16% less in 2014 than in 2002, after adjusting for inflation;
Paying down $350 million in debt;
Reforming closed pensions that were draining taxpayers;
Restructuring City government;
Delivering $5 million annually in Target Center property-tax relief with the 2012 stadium deal.
Had leaders not made those tough choices, property taxes would be 35 percent higher than they are.
Published Dec. 12, 2013