St. Paul and Minneapolis taxpayers should be alarmed that Mayors Carter and Frey are proposing to raise taxes
With inflation still at a historic high, Minneapolis and St. Paul residents are about to be hit with some (huge) property tax hikes.
According to the Star Tribune, St. Paul Mayor Melvin Carter has proposed a 15 percent hike to the city’s property tax levy for the 2023 year.
In his annual budget address Thursday morning at the Harriet Island Wigington Pavilion, Carter proposed a $782 million budget that he called a “nuts-and-bolts” fiscal plan, marking a $41 million increase from 2022.
Some of that hike is due to a shift in the way that the city can collect funds. Since the city cannot charge user fees for street maintenance, due to a court order, those costs will be shifted to property taxes.
A court ruling in May left St. Paul with a $15 million budget hole after a judge ordered the city to stop assessing individual property owners for routine maintenance of streets abutting their property.
Half of the $26.9 million levy increase would go toward providing services that assessments previously covered — lighting, sweeping, seal coating and mill and overlay.
In Minneapolis, the proposed tax hike is 6.2 percent. As reported by the Star Tribune,
….Frey is pitching an increase in the property tax levy — and one that is larger than the city anticipated in previous financial projections. Frey’s spending plan calls for a 6.5% increase in 2023 — an amount the city anticipates would give the median homeowner a roughly $1,835 bill — and 6.2% in 2024. Earlier projections had estimated the increase in the tax levies for those years would be closer to 5%
Where the money is going
For St. Paul, half of the tax hike is money that the city would have still collected through street fees. So, it is a mere restructuring of who pays and how.
And the other half?
The other half accounts for inflation and other added operating costs, Carter said.
“Same as every family and resident, the work of the city costs more every single year,” he said in an interview Monday.
For Minneapolis, Mayor Frey, among other things
also proposed spending more to improve the quality of public housing, treat opioid addiction and combat climate change.
That’s right. While taxpayers suffer from rising prices, the leaders of Minneapolis and St. Paul want even more money for government spending.
At a time when taxpayers are still bracing hardship in order to deal with rising prices, hitting them with tax hikes is far from wise, but it also begs the question of whether all of the proposed spending is at all necessary.
Certainly, plans to increase spending on public safety are welcome and potentially worthwhile considering the levels of crime, but it’s unlikely that spending money on things like community outreach will have the impact that these leaders envision.
Moreover, in 2022, St. Paul and Minneapolis only spent 17.2 percent and 8.85 percent of their budgets on the police respectively. So, public safety is not where a big chunk of these cities’ funds are going. In fact, housing was the biggest growing spending program in Minneapolis between 2021 and 2022 — and Mayor Frey wants to add more money to it despite no evidence showing that more spending will improve the housing problem.
Taxpayers should be more skeptical
With historic inflation rates and signs likely pointing to a recession, the logical thing for both of these mayors to do would be to rein in their spending; that is refrain from increasing spending on non-essential programs like climate change or race and equity, and stay away from introducing new programs.
The fact that economic hardship being experienced by taxpayers is not a good enough reason to make these two leaders reenvision their spending means that nothing short of taxpayer activism will stop them from ballooning their budgets even further in the future.
St. Paul is already considering using taxpayer funds to introduce free Pre-K sometime in the near future. And if that happens, it means taxes will have to go even further. And who knows what other free programs the city would also have introduced by then?
Currently, St. Paul’s universal income program relies on federal COVID-19 funds as well as donations from well-wishers, but Mayor Carter has not completely ruled out the possibility that he might tap into taxes somewhere down the road. And if that happens? More taxes.
St. Paul and Minneapolis residents need to be more skeptical of their governments. They need to ask if all of these spending programs are really necessary and whether all this spending will pay off.
Otherwise, they are going to be in for a whole lot more taxes if their respective Mayors get their way.