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City councils

Minneapolis City Council Member Works to Trim Property Tax Increase

Strategic Insights

— 1 min read

In a move that could have significant implications for homeowners, Minneapolis City Council member Paul Ostrow is working to trim the proposed property tax increase for next year. As chairman of the council's budget committee, Ostrow is set to offer amendments to Mayor R.T. Rybak's proposed budget that would cut the levy increase. This comes after a recent judge's ruling substantially cut the amount that the city's pension costs will rise, allowing the proposed 11.3% property tax increase for 2010 to shrink to 7.3%.

Key Takeaways:

  • Ostrow's proposal would cut the property tax increase from 7.3% to 5.5%, which would translate to a 2.1% tax rate increase for homeowners overall.
  • The proposed amendments would also re-form the expiring taxing districts, which would leave those taxes available for general use instead of capturing them for neighborhood programs and paying off Target Center debt.
  • Ostrow would further trim the Affordable Housing Trust Fund from the mayor's proposed $8.5 million to $6.5 million.
  • The proposal would shift about $2 million in federal community development money into spending that traditionally is supported by property taxes, while making other cuts.
  • Savings would come from cutting take-home car use in half for the police department, ending evening hours for the 311 city help line, and using the Fire Department for boarding up vacant buildings.

Statistics:

  • The proposed 11.3% property tax increase for 2010 could shrink to 7.3% after a recent judge's ruling.
  • The 7.3% increase would translate to a 2.1% tax rate increase for homeowners overall.
  • Ostrow's proposal would cut the property tax increase by 2.8% (from 7.3% to 5.5%).
  • The male mayor, R.T. Rybak, has proposed to trim the Affordable Housing Trust Fund from $10 million to $8.5 million.
  • The proposal would shift about $2 million in federal community development money into spending that traditionally is supported by property taxes.
  • The savings from cutting take-home car use in half would be $440,000.
  • The savings from ending evening hours for the 311 city help line would be $300,000.
  • The savings from using the Fire Department for boarding up vacant buildings would be $400,000.

Sources:

  • "Minneapolis Tax Hike Could Be Scaled Back", by staff writer Paul Ostrow, June 25, 2009
  • "Judge Reduces Hike in City Pensions", by Steve Brandt, June 22, 2009

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