Aug 15, 2023 - News

What you need to know about Mayor Frey's Minneapolis budget proposal

Photo illustration of Minneapolis Mayor Jacob Frey with lines radiating from him.

Photo Illustration: Brendan Lynch/Axios. Photo: Nicholas Pfosi/Bloomberg via Getty Images

Mayor Jacob Frey's proposed $1.8 billion budget for Minneapolis will raise property taxes for typical homeowners, in part to pay for pricey police consent decrees and more public housing.

The big picture: Frey is sticking to the 6.2% property tax levy increase he forecasted a year ago. That means the owner of a median priced Minneapolis home — $331,000 — will pay an additional $150 to $160 on the city-portion of their annual property tax bill in 2024.

Reality check: That's not the only place where residents will pay more in Frey's proposal which was unveiled Tuesday.

  • Utility bills (water, trash, recycling, and sewer) will increase by $73 a year for the average customer.
  • City leaders have proposed hiking the franchise fee on electric and natural  gas that helps pay for weatherizing homes, installing solar panels and other initiatives to combat climate change. The additional cost per household would be $8-$12 a year, on average.
  • Potential levy increases by Hennepin County, Minneapolis Public Schools and the city's park board could also add to those expenses.

Zoom in: Here's where the money is going.

  • An increase of $16 million to the police department budget to staff up for federal and state consent decrees that will force reforms on MPD. "This investment will go toward every part of the process to fundamentally change the way policing is done in Minneapolis," Frey said in a speech Tuesday.
  • The police budget would grow by 5.6%, to $217.6 million. That is enough funding for 731 sworn officers, but there's currently just 586 as MPD is still recovering from the loss of 450 officers since 2020. To make up for that, the city is budgeting one-time overtime funding of $5 million.
  • Frey wants to add $25 million to affordable housing initiatives, including a $4 million increase for public housing. His budget also adds $1 million in funding for additional homeless shelter capacity
  • His proposal includes $2.7 million for repairs to crumbling parkways

Between the lines: St. Paul Mayor Melvin Carter used an $8.8 million increase in local government aid (LGA) passed by the DFL-controlled Legislature last session to keep his proposed levy increase to 3.7%.

  • Frey, who got a $7 million boost in LGA, didn't come down from his 6.2% projection. A spokesperson for the mayor said the additional money helped him keep the levy hike and "sustain the additional proposed spending."

What's ahead: City council members will have a chance to propose changes to the budget this fall before a scheduled adoption in December.

  • Public hearings are scheduled for Oct. 25, Nov. 1 and Dec. 5.

Editor's note: This story has been corrected to show city leaders proposed adding $8-$12 a year to a fee in electricity and gas bills, not $96-$144.


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