Council approves 2017 Minneapolis budget that includes levy increase of 5.5 percent

The Minneapolis City Council on Wednesday approved a $1.3 billion budget for 2017 that will raise the city's tax levy at a rate not seen since the recession.

The city expects to collect an additional $16.3 million through property taxes next year, a 5.5 percent increase over 2016. The levy increase is the largest since Mayor Betsy Hodges took office in 2013.

More than half of the new money is needed to help cover rising employee pay and benefits set in labor contracts. The city also plans to add police officers, a small-business initiative and provide better parks maintenance.

The budget includes $4 million in new spending to hire 15 police officers and 20 part-time community service officers. Another $3 million will pay for improved maintenance at city parks, part of a 20-year roads and parks plan approved earlier this year.

The public hearing before council budget deliberations was dominated by residents' concerns about two issues: the city's hiring of more police officers, and the city's banking relationship with Wells Fargo, which handles transactions, investment management and bond issuance for Minneapolis.

Londel French, an Uber driver, asked the council not to hire any more police.

He said he was arrested a year ago by white police officers when he was trying to pick up a fare at a McDonald's parking lot in Uptown early one Sunday.

An officer knocked his phone out of his hand, arrested him and charged him with trespassing, he said.

Nobody explained to him why he was being arrested until later, and he had to pay to pick up his car from the impound lot.

"If you look like me, dreadlocks, fat dude, black — you don't matter," he said.

Several others asked the city to stop doing business with Wells Fargo, mostly because of the bank's investment in the oil industry, including the company behind the Dakota Access oil pipeline.

Following the hearing, council members let loose with a flurry of small amendments to the budget.

On proposals from Council Member Lisa Goodman, $250,000 in funding was moved for Meet Minneapolis into community-based policing by the Downtown Improvement District, and $115,000 was shifted away from Greater MSP for a full-time city position focused on small-business retention.

The first amendment passed unanimously and the second passed with only one dissenting vote, from Jacob Frey.

The new small-business-retention employee will work with a several-person small-business "navigator" office that's also part of the 2017 budget.

The council responded to the concerns about Wells Fargo that were voiced in the public hearing, and directed its staff to explore ways the city could "stop doing business with financial institutions that invest in the fossil fuel industry," in a measure proposed by council members Alondra Cano and Cam Gordon.

Possibilities include establishing a municipal bank or participating in a publicly owned banking operation, and city staff were asked to come back with a report by July 2017.

On a proposal from Mayor Betsy Hodges, the council decreased the city attorney's office budget by $100,000 and added $100,000 for the Civil Rights Department to add a full-time employee who will investigate complaints.

"A number of people are feeling less safe and less protected in this country now," Hodges said. "Additional resources in the Civil Rights Department is one of the many steps we're going to need to be taking."

An amendment proposed by council member Lisa Bender passed, taking $67,000 from the Fire Department and Public Works to spend on a hospital-based violence prevention program.

The amendments moved money from department to department, but didn't change the overall tax levy.

The levy is a dollar figure collected through property taxes, which is spread out over the city's fluctuating residential, commercial and industrial tax base.

The Minneapolis tax base is growing, but many homeowners will still feel a tax pinch. City staff say the bulk of the city's tax base growth is due to rising property values, versus new construction.

Taxes on five new buildings are being siphoned into a special streetcar fund, which amounts to about 1 percent of the city's tax capacity. And growing commercial values mean the city's net obligation into the region's pool of shared commercial and industrial tax base will rise from $3 million to $10 million.

Adam Belz • 612-673-4405