City backs legislation to extend popular NRP

Each of the two proposals would extend tax financing for the Neighborhood Revitalization Program.

By STEVE BRANDT, Star Tribune

Last update: March 21, 2008 - 11:17 PM

Minneapolis City Hall is now officially behind extending the life of its Neighborhood Revitalization Program.

On Friday, the City Council endorsed legislation that would extend its oldest tax-increment financing districts to fund the program. If the Legislature agrees, that would keep money flowing to NRP, as well as financing Target Center and some other city redevelopment priorities.

NRP is popular in neighborhoods because it provides money for local priorities such as home improvement programs and youth employment. But at City Hall, NRP is also seen siphoning dollars that could be used for development and other city projects.

NRP was authorized for 20 years and an expected $400 million. But the 20 years end next year, and the taxes from new development that finance NRP have produced only about $300 million.

So both neighborhoods and the city are asking the Legislature to extend the capture of those development taxes to fully fund the program.

Council Member Scott Benson said he doesn't think the two proposals are significantly different; neighborhood proposal backer Deb Evans disagrees.

Both would help NRP hit the original $400 million target. Both also ask the Legislature to fix a problem it created by cutting business tax rates. That dampened the expected yield from development districts for NRP and other city projects. Such districts capture the increased property taxes from development to pay first for public costs of that development and then other city purposes like NRP.

Hennepin County has long been skeptical of such districts. Some commissioners want the increased tax base open to all taxing agencies.

The neighborhood proposal would give the county and other taxing agencies the same taxes they'd get if the districts weren't extended; the city proposal offers the county a stake in the proceeds.

The neighborhood proposal would extend districts for 10 years; their extension under the city proposal would depend on how fast revenue accumulates.

Meanwhile the council also:

• Gave formal direction that proposals be sought for equipment needed to implement instant-runoff voting. Council Member Elizabeth Glidden also gave notice that she'll be introducing an ordinance to spell out procedures for counting ballots in the voting system, in which voters rank their top three choices for each office in order of preference. The city's top election official has said it's doubtful that the system will be ready for next year's city voting, but council members want to exhaust the possibilities.

• Banned disposable coffee cups for council use in favor of reusable ones.

Steve Brandt • 612-673-4438

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