Police budget battle looms as Minneapolis tax board approves maximum 5.45% levy

Minneapolis Tax Council approved a maximum property tax levy to cover Mayor Jacob Frey’s proposed budget for 2022, but council members said they feared it was not enough to cover financial risks police use of force regulations.

Arguments from board members at Wednesday’s board meeting set the stage for a looming battle over next year’s police budget, which Frey seeks to restore to roughly where it was. before the murder of George Floyd.

The Board of Estimate and Taxation voted to approve a total property tax increase of 5.45%, up to $ 417 million, to cover expenses for the city’s general fund, pensions, parks and recreation and other funds, as Frey called for in his $ 1.6 billion budget proposal for 2022.

Before the board of directors approved the mayor’s request, the two city council members who sit on it criticized the mayor’s budget for possibly underestimating the financial risks of the use of force bylaws. the police.

The police murders of Justine Damond and George Floyd in recent years have resulted in unwarranted settlements of $ 20 million and $ 27 million, respectively.

“The reality in our city right now is that the cost of our policing system is skyrocketing and there is a huge financial risk in our budget related to prosecutions and legal liabilities related to the police,” said the President of City Council Lisa Bender. She noted that the city’s self-insurance fund’s net position was $ 98 million in the red at the end of 2020.

Carol Becker, elected member of the tax council, championed risk assessment by municipal actuaries. “I know there probably wasn’t any real planning for the size of the settlement that city council chose to do, but it’s professional actuaries who do this kind of work,” she said. .

The transfer of money to the self-insurance fund comes at the expense of the needs and dreams of other cities, board member Steve Fletcher said in an interview after the meeting.

“I think the police budget just doesn’t really make sense,” he said. “There’s a lot of attrition, so we’re starting with fewer officers than we budgeted for, so there should be money there.”

Frey, Fletcher, Park Council Commissioner Londel French, Tax Council Chairman David Wheeler and Becker voted to approve the maximum levy. Bender is opposed to it. In an interview, she expressed concern about the mayor’s overall proposal and the growth of the police budget despite the fact that other essential city services, such as public works, have to cut positions.

According to city budget staff, the city’s overall fiscal capacity has shifted towards residents and away from the commercial sector, which has seen reduced property values ​​and businesses linked to the pandemic move out of spaces, according to the report. city ​​budget staff.

The owner of a single-family home valued at $ 297,000 is expected to pay $ 1,634 in 2022, $ 140 more than last year. Owners of commercial buildings valued at $ 529,000 will see their municipal taxes increase by $ 120. The city’s property tax bill does not include county, school district, and watershed taxes, which vary depending on where people live.

Residents of low-income neighborhoods, where property values ​​have increased at a faster rate, will face a larger tax hike.

The city council will then consider the budget proposed by the mayor, hear from department heads and hold public hearings to collect residents’ comments. In November, residents will receive estimated tax returns from the county, and city council will hold a final budget hearing to address the municipal part of property taxes. The city council will adopt the final 2022 budget in December.

Also at Wednesday’s tax council meeting, French proposed changing the revenue stream for the park council’s $ 2.6 million request, which would have raised the cap on levies.

The mayor’s budget pledges to increase that amount for youth programs in parks, but specifies that half will come from property taxes and the rest from federal COVID-19 relief funds, which will eventually run out. French demanded that all of the $ 2.6 million come from property taxes for greater longevity.

Members of the tax council rejected the motion.

“I really wish the young people of the city were guaranteed to get their money back,” French said. “Our city is in crisis right now. We have young people who are victims of this crime and I think our parks are ideally located to alleviate much of the violence that is taking place.”

The park’s board of directors also discussed the vote at its meeting on Wednesday evening, with Commissioner Brad Bourn saying: “A false shortage argument has once again prevailed on the valuation and taxation board,” and the vice president of the board, LaTrisha Vetaw, adopting a more optimistic tone as she thanked French for helping the park board raise more money than it has received in years.

“I have no mixed emotions about getting a substantial investment in the plan that the Superintendent and our staff have worked so hard to build upon,” said the Chairman of the Board of Directors of the park, Jono Cowgill. “This is an important time for us to be sitting here, ready to finally implement at least a substantial part of what we have articulated.”

Susan From • 612-673-4028