Frey proposes $1.8 billion budget for Minneapolis in 2024: 'Change isn't cheap'

Mayor Jacob Frey is proposing a $1.8 billion budget for Minneapolis next year that attaches some of the first dollar figures to the police reforms mandated in the three years since the murder of George Floyd.

"Change isn't cheap," Frey said in the annual address to City Council members, who will scour the proposal and likely consider changes in the coming months before the budget becomes final in December.

"And change isn't optional," the mayor continued. "It's no longer optional as to whether we have an early intervention system or hire compliance positions and use-of-force specialists. We have to."

In addition to annual rising costs — such as increased wages for city workers — the plan includes some $48 million in new spending, much of which would pay for new employees, including those needed to implement changes to policing.

A large chunk of the new spending would be funded by a forecast 1.6% increase in city revenue. That influx comes from a combination of increased state funds approved by the Democratic-controlled Legislature and Gov. Tim Walz, who tapped part of a massive state surplus, as well as locally generated taxes from heightened economic activity downtown — a feature of the post-pandemic recovery perhaps best exemplified in recent marquee concerts by Ed Sheeran, Beyoncé and Taylor Swift, city officials said.

Frey's plan — which also prioritizes expanding the ranks of police officers, investing in public housing, responding to climate change and repairing pothole-pocked streets — carries with it an increase of roughly 6.2% in the city's property tax levy, costs which would be shouldered by residents and businesses.

Under Frey's proposed budget, according to city estimates, the owner of a $331,000 home in Minneapolis would see an increase ranging from $150 to $160 in property taxes.

That figure would include a proposed resurrected tax by the Minneapolis Public Housing Authority that would cost the owner of a $331,000 home about $21 a year. That funding would add $4 million annually to the MPHA, which is grappling with a $229 million backlog of repairs.

City residents and businesses would pay in other ways for some aspects of Frey's plan. A proposed hike in electricity and natural gas fees, to pay for parts of the city's climate response plan, would cost residents and businesses an estimated $8 to $12 annually. And water bills would increase about 16 cents a month to assess the state of stormwater systems on park district land.

Other taxing bodies, such Hennepin County and Minneapolis Public Schools, set their property-tax-and-spending plans independently of the city.

Here are some areas on which Frey's budget focused, based on city documents and interviews with Frey and city officials.

Police reform

Two outside investigations — one by the U.S. Department of Justice, and another by the Minnesota Department of Human Rights — have found deep-rooted problems within the Minneapolis Police Department, especially in how it treats Black and Indigenous people.

Earlier this year, the city entered into a settlement agreement with the state, and officials are negotiating a similar agreement with federal officials. Both agreements, which seek to end patterns of racist practices, will be overseen by court-approved monitors and are expected to take years. Last week, Police Chief Brian O'Hara announced a shake-up of department managers as part of the process to rebuild community trust.

Frey's proposed budget envisions 34 new hires, including 28 civilian positions in the Police Department designed to engage the public, oversee the process and implement the changes.

The cost: $16 million in 2024 and an estimated $11 million in 2025, according to Frey's proposal.

About $1.45 million in new spending is slated to expand the city's behavioral crisis response program — teams of specialists who are tasked with emergency calls that might be better suited for a mental health worker than an armed police officer. The new spending should allow the program to cover the entire city.

George Floyd Square

Frey's plan proposes spending $720,000 on George Floyd Square at 38th Street and Chicago Avenue in south Minneapolis, including securing a vacant gas station the city now owns, improving lighting in the area and taking a "Smithsonian-type" inventory of artwork and offerings that have cropped up there in recent years and might need to be preserved.

More cops

As with the current budget, Frey's proposed 2024 budget would fund 731 positions for sworn officers. That's the number required by the city charter — but like last year, the city's actual ranks remain far short. Some 586 sworn officers work for the city, down from 609 a year ago.

In addition to providing money for recruiting officers to apply from outside the region, Frey said he hopes that spending an additional $2 million to hire civilians for nonpatrol jobs in the department will allow more of its existing officers to be on the streets.

Potholes and roads

Following an especially snowy, wet and freeze-thaw-ridden winter and spring, city public works crews have catalogued some 8,000 potholes this year — about the same number logged in the previous three years combined.

Frey's plan includes some $470,000 for new pothole-patching equipment, part of a $70 million investment toward city streets.

The roads that ring the city's lakes and wind through its parks are actually owned by the Minneapolis Park and Recreation Board, not the city. Most users of those roads don't care who owns them, Frey acknowledged, but they notice their condition. His budget proposes that the city increase funding going toward Park Board-owned streets, or parkways, from $750,000 to $1.25 million next year, with a plan to keep ramping it up to $2.75 million in 2027.

Politics of the moment

In one part of his speech, Frey listed every council member by name and mentioned something they'd requested that he had included in his plan — evidence, he said, of a "collective budget."

However, the politics of the moment are more complicated. All 13 council seats will be on the ballot this fall, and Frey's influence could be in the balance. He currently enjoys general support from a majority on the City Council, including President Andrea Jenkins, who gave his proposal high marks afterward.

But a group calling itself "Minneapolis for the Many" announced its presence Tuesday with the goal of "mov[ing] on from Jacob Frey's City Council majority" to electing a "progressive majority" on the council — which would put the council to the left of Frey.

The group said it plans to spend money and mobilize support for a slate of candidates who, if elected, would put council support for Frey in serious doubt. Tuesday was the last day for candidates to file for the election. Frey himself isn't on the ballot this year.