St. Paul Mayor Melvin Carter offers budget with smaller property tax increase, urges voters to hike sales tax

Standing before a crowd at the new Highland Bridge development Thursday, St. Paul Mayor Melvin Carter unveiled an $820 million spending plan for next year focused on public safety, infrastructure and operational improvements.

Carter said property taxpayers would get a break under Carter's proposed budget, after this year's 15% levy increase, thanks to more money from the Legislature. But he said his goal for fixing the city's crumbling streets over the next 20 years depends on voters agreeing to a 1% hike in the sales tax.

In addition to the main priorities, Carter also introduced proposals to spend city funds to forgive medical debt for individuals and offer free swimming lessons, among other initiatives.

Carter's proposal would raise the property tax levy to $208 million, a 3.7% increase from this year. But the owner of a median-value home — which costs about $267,400 in St. Paul — would see their city property tax bill go down $26 next year due to growth in the commercial and industrial sectors.

The levy is the total amount the city collects in property taxes. Since the assessed value of commercial and industrial properties are increasing at a faster pace than homes in St. Paul, those building owners will take on a larger slice of the tax pie.

This year, St. Paul property taxes jumped due to a levy increase fueled by a combination of inflation and a shift in how the city pays for street maintenance. Carter said the levy hike in 2024 would be double if not for the Legislature, which increased St. Paul's local government aid by $8.8 million.

Public safety

The Legislature also voted to send one-time public safety aid to cities, and St. Paul is getting $13.6 million. After calling for a moment of silence for Markee Jones, a 12-year-old fatally shot by his brother last weekend, Carter announced plans to spend roughly half of the funding on gun violence intervention initiatives over the next three years.

"We will equip our police department with the resources they need so that we can bring the same level of presence and attention toward investigating and holding accountable those responsible for non-fatal shootings in our city, just as we do for fatal shootings," the mayor said.

That intervention effort would also draw funding to hire more critical-care first responders, contract community outreach workers, continue a gun diversion program and purchase mobile camera systems to help monitor crowds.

Additional dollars would go toward a police academy, equipment for firefighters and increased safety measures for recreation centers and libraries.

Infrastructure

The mayor used his address as a chance to make another plug for his sales tax proposal, the fate of which will be determined by voters this fall. The 1% increase would raise nearly $1 billion for street and park maintenance over 20 years.

"While our sales tax proposal will not fund police, fire, recreation or library services, not passing this proposal will severely strain the resources available for all of those functions in the coming years," Carter said.

In the meantime, the mayor's proposal would pause the city's seal coating program and redirect the money toward mill and overlay work and skim paving. The budget also includes funding to hire five new employees to handle snow plowing and summer street maintenance.

Other spending plans

Carter also proposed a nearly $2 million spending increase to boost hiring of finance and technology staff.

"This budget that I'm proposing continues the trend that we've established over the last couple years of saying we're going to be, frankly, pretty judicious of what we put against the general fund property tax levy," the mayor said in an interview, while saving grants to fund "some of our innovative and cool new initiatives that we have on deck."

Carter wants to use $1.1 million of the city's federal American Rescue Plan dollars to acquire and cancel up to $110 million in medical debt for tens of thousands of St. Paul residents. Like some local governments across the country have already done, St. Paul would partner with nonprofit RIP Medical Debt, which would work with hospitals to acquire delinquent hospital bills and forgive them.

The mayor also wants to use $250,000 to make swimming lessons free. The money would cover around 2,500 children, the maximum amount the city's public pools can handle, budget staff said.

The City Council has final approval of the budget and in recent years has made adjustments, typically small, to the spending plan.

"I feel really positive about the budget that was presented to us today. It's a modest levy increase," Council President Amy Brendmoen said after the address. "One of the things we want to do now is look back and make sure that the initiatives and programs that we've funded over the years actually moved forward, and check how well that they've performed."

The council is slated to set a maximum levy at the end of September and approve the final budget in December.