Carol Becker holds an obscure job among Minneapolis elected officials: She’s a member of the Board of Estimate and Taxation. The BET sets the city’s maximum property tax levy, which the mayor, City Council and Park Board can’t exceed.
For many years, Becker has participated in an online forum I helped create in the late ’90s, Minneapolis Issues. She’s been diligent about educating participants, not only about the BET, but about city finances in general. But Wednesday, she asked for help — in a remarkably open and personal way for a public official.
Minneapolis Mayor R.T. Rybak has proposed a 6.5 percent property tax increase, mostly to deal with pension obligations. The mayor has since asked for an extra percent to deal with possible state cuts to local government aid.
Becker is no taxophobe — as you’ll see from her note below, she believes the city faces cuts that “wouldn’t get to bone, it wouldn’t get to meat — it would get to the heart.”
However, she is about to be laid off from her day job (BET commissioners aren’t paid much). Therefore, she — like many Americans facing fixed or reduced incomes — is sweating a tax hike she says will translate to at least 12 percent on the city portion of property taxes.
I offer her query up for comment, with one request: that your responses be as thoughtful as her question. Attacking hot-button city spending line items that don’t add up to much won’t solve the problem. Neither will some magical new revenue source which may make sense down the road but won’t help Becker this year.
She can’t kill or create programs. She can only vote on the city’s request, or offer a lower maximum.
Here is the decision that I am having to grapple with.
The Mayor has proposed a budget which includes a property tax increase of 7.5 percent. But because of creating a TIF (Tax Increment Financing) district for the (city-owned) Target Center and NRP (Neighborhood Revitalization Program) and some other complex movements in the tax base, the average homeowner is facing more like a 12-14 percent increase.
Implicit in this is a LGA amount of $87 million. Given the state is facing budget Armageddon, it is possible we could receive anywhere from $0 to $87 million.
LGA has been one of the first things cut at the State and we can expect this to occur again although we won’t know how much until we are substantially into the budget year. Also, how much will depend on who is elected governor, also something we won’t know until late into the year.
We have been making budget cuts for ten years now. The streets are already coming apart. The parks are not being maintained. Crime is down but not as low as we would like, especially in certain parts of town. murders and gang activity have ticked back up.
If LGA is cut more towards zero than $87 million, we could be looking at our own budget Armageddon, closing parks, closing fire stations and laying off a hundred cops or more. This wouldn’t get to bone, it wouldn’t get to meat — it would get to the heart. Decisions that not only degrade our homes but threaten our lives and hurt us in the long-term. We could go the way of other core cities, something we have aggressively avoided up until now.
People are hurting — really hurting. Wages cut, hours cut, jobs lost. I myself am being laid off from my full-time position at the end of the month. So I know this pain as well as anyone. It is galling to me to ask anyone for more money in this environment.
So I ask the group for wisdom — what should I do? Should I go with the Mayor’s recommendation, knowing it would be a 12-14 percent increase in city taxes for may residents? If I go lower, I may be setting the
City up for a worse problem as the state shifts its problem to us. Layoffs could be larger than they would be with the Mayor’s recommendation if I don’t.
For this scale of money, there is no tweak, no “around the edges” of budget cutting — this would be hacking at critical activities. I can’t imagine going higher, even though it may mean preserving important things about our community like our streets and our parks.