Minneapolis and St. Paul will get their first state aid increases in five years under the tax bill that passed the Legislature this week.
Both cities will receive about a 20 percent boost in their local government aid (LGA) payments next year, which could have a significant impact on their budgets. LGA accounted for about 13 percent of Minneapolis' general fund revenue in 2013.
The total LGA payment to Minneapolis will be $76 million, while aid to St. Paul will be $60.4 million. Aid to both cities has been cut dramatically in recent years as legislators grappled with perennial deficits -- Minneapolis LGA was once $111 million.
LGA is distributed to cities across the state based on a formula determined by the Legislature. Lawmakers this year lowered the number of variables from 17 to seven, giving Twin Cities suburbs a larger slice of the total pie.
Minneapolis leaders have blamed LGA cuts for rising property taxes. But whether the increases translate into property tax relief depends on the mayor and City Council not spending the money elsewhere.
A number of suburbs that do not currently get state aid will begin receiving it under the bill, including Maplewood, Oakdale, Roseville, Bloomington, and St. Louis Park. See the full breakdown by city here.
Updated at 5:07 p.m.
One provision in the state tax bill could have a significant impact on Mayor R.T. Rybak's dreams of building a streetcar in Minneapolis.
The bill allows the city to dedicate tax revenues from several specific parcels around Minneapolis to help pay for a new streetcar line. The city pushed for the new funding method because, unlike regional transit like light rail, streetcars would be a localized project requiring more municipal investment.
Federal funding is still key to the deal. The city won federal funding to perform an alternatives analysis for a line along Nicollet and Central Aves. -- which is almost complete -- and city staff are preparing to apply for a TIGER grant to help fund the line itself.
The "value capture district" designated by the state for funding streetcars is similar to tax increment financing. It uses revenues from parcels near the transit line to pay off bonds issued to build it.
The money could be used to pay for planning and constructing the streetcar line, including transit stations, as well as acquiring or improving public space, according to the legislation.
Mayoral aide Peter Wagenius said they expect the parcels identified in the tax bill could generate about $5 million a year and support a $50 million bond issuance.
Minneapolis had pushed to give cities a broad authority to use tax increment for transit development, but walked away with a “pilot project” focused solely on the Nicollet-Central streetcar.
“This is a big victory," Wagenius said. "In a session where nothing happened for transit, we found a way to keep moving forward on transit. And we’re really proud of that.”
So which parcels will generate the money for the streetcars? They include the future location of two high-rise apartment buildings and several other sites where developments are already in the works.
That could set up some interesting discussions at the City Council, since property taxes from those properties would be directed into the streetcar rather than the general fund. Hundreds of new residents -- the apartment buildings are 36 and 26 stories tall -- will simultaneously need city services, which puts more pressures on the city budget.
"What we hope to prove by the end of this project is that we will get an increase in value along the corridor beyond that which is projected on these six blocks," Wagenius said.
Wagenius noted that a another key difference between this and tax increment is that it benefits a public amenity rather than a single developer.
Here are the parcels:
View Streetcar TIF in a larger map
The state will give the Minneapolis about $33 million over several years to help pay off debt on the downtown library, per a last-minute addition to the state tax bill at the Legislature.
Rep. Jim Davnie said the provision will supply about $4.7 million a year between 2016 and 2025. City voters approved borrowing $140 million in 2000 to build the facility, which now stands at 3rd Street and Nicollet Mall, and improve community libraries.
The addition to the tax bill was a tit-for-tat of sorts. It came after the state agreed to forgive loans on the Xcel Energy Center, located in St. Paul.
“It’s a recognition that the downtown library is really a statewide asset in terms of its collections, services and profile,” said Davnie, DFL-Minneapolis.
“The state stepped up and helped out the Xcel Center this year because that’s a statewide asset. It just happens to be located in the city of St. Paul. The downtown library is a statewide asset that just happens to be located in the city of Minneapolis.”
The downtown library, known as the Minneapolis Central Library, opened in 2006. Its unique structure was designed by architect Cesar Pelli. The library is part of the Hennepin County Library system, which consumed the city's own system in 2008.
The city recently refinanced the bonds and reduced the life of the debt service to the library.
She’s no longer principal at Washburn High School, but Carol Markham-Cousins will be making a cameo appearance at graduation next month.
That allows her to see off the crop of seniors who rose through Washburn under her tutelage, and gives the school some closure after her abrupt removal in April.
In response to a Star Tribune inquiry, the district said – after some confusion -- that Markham-Cousins’s signature will appear on diplomas and that she speak at the ceremony.
She was replaced on an interim basis by Craig Vana, a retired district administrator who has no previous connection to the school. That raised the question of whose name would be on student diplomas.
Markham-Cousins is working as a principal on special assignment, assisting the associate superintendents on projects, according to district spokeswoman Rachel Hicks. Those include serving as one of the principal representatives on a five-year enrollment project. assisting development of a high school Spanish Immersion program, working on high school schedule changes, and doing teacher observations to help some schools complete teacher evaluations.
A list of principal assignments for next school year is expected to be publicized this week.
One of the most glaring holes in the Hennepin-Lake retail corridor is the historic Granada Theater, an empty building wedged between the Apple store and a Thai restaurant.
We reported in December that the landmark status of the 86-year-old theater -- known known as the Suburban World -- has scared off some potential buyers, leaving it vacant for more than a year. But it appears that's about to change.
Early next month, the city's Heritage Preservation Commission, which reviews historic properties before they are demolished or refurbished, will take up this item:
Renovation and Partial Restoration of Granada Theater. The project proposes to renovate the Granada Theater into a retail store and would include restoration of the exterior, removal of the kitchen area, restoration of the existing theater space walls and perimeter circulation, and introduction of a flat floor to facilitate retail store experience and center entry to the theater for visual connectedness.
About a decade ago, the property on Hennepin Avenue just south of Lake Street was converted from regular seating into something akin to a multi-level restaurant. In addition to films, owners offered brunch and lunch on the weekend accompanied by vintage cartoons.
MPLS has a call into realtor Jesse Olson to get more information about the renovation plans. Realtor Jesse Olson said he could not disclose more about the development plans, including who the tenant would be.
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