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Continued: Big chunk of Rybak's 2009 budget designated to public works

  • Article by: STEVE BRANDT , Star Tribune
  • Last update: August 15, 2008 - 12:01 AM

Minneapolis property tax revenues will bump upward, but more city streets should offer smooth driving under a proposed 2009 budget unveiled Thursday by Mayor R.T. Rybak.

The proposed levy increase of 6.9 percent would be the smallest percentage increase since 1998 and interrupt a string of 8 percent increases that began in 2003 and was scheduled to continue through 2010.

It would add an additional $15.6 million to the current's year property tax revenues of about $304 million.

Overall spending would total $1.4 billion in 2009.

For the next five years, Rybak proposes to spend $27.5 million more than already budgeted to beef up portions of the city's public works programs.

Most of the money would go to accelerating work on major streets and parkways, which would get a 28 percent increase in spending in that time.

Rybak said that's enough to resurface 43 more miles of those roads than planned in the city's current five-year plan; an extra 26 miles will get patching and seal coating. In all, Rybak said, more than one-third of city-managed arterial streets would get some work.

Rybak said the city can afford to both lower the scheduled tax increase and increase spending on public works because belt-tightening efforts have yielded results. But to afford the attention to neglected streets and related projects, he said, the city should not increase its police force beyond the current 880 sworn officers.

Forecasting property taxes

Individual tax bills will depend on whether a home's value increases more or less than others, but in general, the burden will shift slightly from residential to commercial property. On a house valued at $216,000, the city portion of the tax bill would increase by $20, or 1.7 percent. But utility fees on the same home would rise by $45 a year because Rybak is recommending hefty increases.

Rebuilding the city

Over the next five years, an additional $5.25 million would be spent to replace 900 substandard light and semaphore signal poles; another 3,800 would be repaired or repainted.

City Parks would get an extra $500,000 for bricks and mortar projects. Rybak said he would like to see the mostly independent Park Board use some of that for bridge work, especially the closed Bryant Avenue footbridge. Another $100,000 would go to off-street bike trail maintenance, including improved winter clearing and surfacing work. It would go to the Midtown Greenway, Hiawatha Avenue and University Avenue NE routes.

Legacy Fund

Rybak would pay for the added projects by tapping the city's Legacy Fund, which was funded by the sale of the city's investment in the downtown Hilton hotel. The fund is earmarked for economic development, but also has been tapped for pension costs in the past. The fund now has about $25 million, but that's expected to grow over the five years, thanks to investment earnings and a major loan repayment.

What Rybak said

"This generation of Minneapolis leaders, who have done so much to address long-term debt and get our financial house in order, need to demonstrate that unmet infrastructure needs are also a debt that cannot be passed on to our kids."

City Council's reaction

Paul Ostrow, chairman of the City Council budget committee, calls the lower tax hike positive but said work is needed to make sure it's not just a one-year change. Infrastructure chair Sandra Colvin Roy was "almost speechless I'm so happy" over the public works increase. Development chair Lisa Goodman thinks the Legacy Fund should be reserved for development. She also has reservations about Rybak's suggestion to focus the affordable housing trust fund more on responding to the foreclosure crisis.

Analysis

It never hurts to ease up on property taxes hikes in a city election year, as 2009 will be. The theme of transportation investment that made up much of his budget pitch is a theme Rybak could take with him if he decides he wants to run for governor.

What's next

The City Council is scheduled to start budget hearings on Sept. 10, adopting the budget on Dec. 11. The mayor's speech is to be posted at www.mayorrybak.us.

Steve Brandt • 612-673-4438

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