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Minneapolis budget provides first property tax levy decline in 3 decades

  • Article by: Eric Roper
  • Star Tribune
  • December 12, 2013 - 5:24 AM

The Minneapolis City Council signed off on a $1.1 billion budget Wednesday night, along with the first reduction in its property tax levy in 30 years.

The 1 percent decrease in the 2014 property tax levy came after the city won its first state aid boost in five years, growing by about $12 million to $76 million. The tax levy will raise $215.9 million in 2014, less than 25 percent of the total city budget. Other revenues come from sources including fees and charges for services.

The 2013 levy grew by 1.7 percent from the 2012 levy, which was the same as in 2011.

Two people testified at the public hearing Wednesday preceding the final vote. Keely Hogan-Braker said since she purchased her home in 2009, her taxes have not gone down, even though the home’s values has increased only minimally. “I don’t think over the long-term it’s sustainable,” Braker said.

Council changes to the mayor’s budget last week included adding $400,000 for police body cameras and nixing a proposed $185,000 subsidy of Midtown Global Market operations — it was instead funneled partly to a competitive grant program. The council separately took initial steps this week to forgive $1.5 million in debt to the market.

The council also put more money into affordable housing, increasing the mayor’s allocation by $1.5 million for a total of $3.5 million in local funds this year — $7.6 million when combined with federal funds. That local contribution is larger than the $2 million budgeted in recent years.

The budget also devotes up to $2.75 million derived from the sale of the downtown Gaviidae complex to fund preliminary engineering for the proposed $200 million, 3.4-mile streetcar line along Nicollet Avenue. That’s in addition to $1.25 million the mayor had already budgeted for the project.

The mayor separately allocated $200,000 to study a possible streetcar along North Washington Avenue and West Broadway Avenue in north Minneapolis.

On Wednesday night, the council added $225,000 for street cameras along Penn and Freemont Avenues in north Minneapolis, as well as one in the University District, to address crime. They also allocated $250,000 to the $9.3 million budget of Meet Minneapolis, the city’s convention and tourism bureau, in anticipation of a busier-than-normal year.

The 2014 spending plan also will fund hiring new police and fire cadet classes and pay to open and staff the city’s 311 information center on Saturdays.

The $1.1 billion 2014 budget represents a 2.2 percent increase over 2013. The mayor’s office said 2014 will be the first time in five years it is not projecting growth in the cost of closed pension fund obligations.

The property tax accounts for about 43 percent of a typical tax bill, city staff said Wednesday. The school board kept its levy flat this year and Hennepin County capped its increase at 0.9 percent. The Minneapolis Park and Recreation Board imposed a $1.1 million special tax levy this year — a 2.1 percent increase — specifically earmarked to pay for removing and replacing ash trees.

 

Eric Roper • 612-673-1732 Twitter: @StribRoper

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