St. Paul Mayor Chris Coleman shot down the City Council’s maximum tax levy of $114.7 million Thursday, calling the additional $1.8 million increase over what he proposed “misguided.”
The mayor vetoed the tax plan the day after council members approved a 2017 levy that would allow the city to collect up to 8.6 percent more in taxes than it did this year. They said it was time to fund deferred parks and recreation maintenance and add firefighters.
Coleman said that spending is premature, given that the city has put money in the 2017 budget to study the fire department and parks and recreation needs.
“We need to govern on fact and we need to budget on fact. And so when we get the facts, then we can sit down and have that conversation about how do we can invest appropriate resources in the department,” Coleman said.
The City Council will reconsider the maximum levy Wednesday. They could override the veto with a five-person majority, but only four of the seven council members supported the 8.6 percent increase this week.
Council Member Chris Tolbert said the 6.9 percent increase Coleman proposed is already a big jump for taxpayers, and it’s not clear that the additional money other council members approved is warranted.
“It’s a high cost and what is it for? I don’t know if that’s fully been justified,” Tolbert said. “It better be an essential when you want that much more.”
If the higher levy fails to get five votes, Tolbert will suggest that they go with the mayor’s proposed maximum of $112.9 million. The city has to set a maximum levy by the end of September or it will remain at the current year’s total of $105.6 million. The council may lower the levy during the budget process if they find places to cut spending.
City leaders could come up with some solution that falls between the two proposed levies, Council Member Amy Brendmoen said.
But Coleman said Thursday that he is unwilling to go above a 6.9 percent increase. He initially proposed a 4 percent jump in August, but pushed the levy increase higher after the state failed to give St. Paul $3 million in local government aid.
Brendmoen said she noticed early on that the mayor’s budget did not include some things she would like to see funded. After Council President Russ Stark met with Coleman to present the council’s priorities, Brendmoen said Stark took inventory of unfunded items and began checking to see if council members were interested in increasing the levy.
It took a little while to come up with the new levy proposal, Stark said, because council members had to reach an agreement on what issues and priorities needed money in 2017.
For Brendmoen, the decision to support a higher maximum levy came down to funding needs she said had been put off for too long, such as parks and recreation maintenance and investment in the STAR program, which supports capital improvements for businesses and neighborhoods.
“At the end of the day, we’re pushing a problem off to the next administration, the next generation,” she said.
Council Member Rebecca Noecker, who also supported the increase, noted at Wednesday’s council meeting that St. Paul property values are up.
“Our city is booming. We’re doing really well right now. And the way to capture that tax base growth, the only way we can do that, is by raising the levy,” she said.
For owners of a median-value house — estimated at $161,200 in 2017, up from $151,500 this year — the 8.6 percent increase would amount to a $54 increase in their payment to the city. With the mayor’s proposed levy, owners of that property would pay $42 more than last year.
Neighborhoods with lower-value homes that were deeply impacted by the recession are seeing some of the largest increases in value in St. Paul, data from Ramsey County shows.
“Those are the folks that are going to get hit hardest by this levy,” Council Member Dai Thao said. He voted against the greater levy increase, and said he hopes the mayor’s office and council can reach a compromise.