Questioning the City Budget
Mayor R T Rybak finally released his proposed 2012 City Budget on Friday, Sept. 16, after getting it approved sight unseen by the Board of Estimate and Taxation a few days earlier.
Responding to pressures from homeowners in Southwest Minneapolis and probably from property owners downtown, Rybak has proposed no increase in the city property tax for 2012. However, because the Republican State Legislature has eliminated the homestead tax credit, most homeowners will see a big leap in their 2012 property tax bill in spite of Rybak holding the line. In his speech presenting the Budget he said, “to build a city that works, a city government needs to do two things well: control spending and taxes and make the right investments.” Using his criteria, it must be granted that he has controlled spending and taxes, but the question is whether he has made the “right investments” in capital and labor.
One of the big continual drains on the Minneapolis treasury is the Convention Center. It lost $11.67 million in 2010 and is scheduled to lose $5.77 million in 2011. Most of that expense is due to repairing the domed roof at a cost of about $25 million. According to Heather Johnston of the City Finance Department, the Center is on schedule to show a net profit for 2013. That could be wishful thinking given the downturn in the general economy, but, even if they finish the dome project in 2012 and don’t have any other capital improvement projects to contend with, why should capital improvement projects at the Convention Center be put on the backs of all property taxpayers? If municipal capital improvements are made to a business corner in a neighborhood—ornamental streetlights, paving projects, etc., then the businesses that benefit are assessed directly for the cost and they pay it. Why doesn’t that principle apply to the hotels that directly benefit from activities at the Convention Center? Why aren’t they assessed for capital improvements in the same way that neighborhood businesses are assessed for improvements that benefit their corner?
Target Center is another drain on the taxpayer. The section of the mayor’s recommended Budget that deals with the funding for the Target Center is the most convoluted and confusing description of how one fund dips into another fund that merges into a new fund, etc. But there are two statements about the Center that leap off the page: 1) “Under the special legislation, tax increment from the new district could only be used to pay principal and interest on Target Center bonds or for ‘neighborhood revitalization purposes.” 2) “The Consolidated TIF District will generate approximately $5 million in annual net tax increment revenue in 2012 and 2013, all of which will be used for Target Center debt service.” The total of $10 million could have been used for “neighborhood revitalization purposes” but instead is being used to renovate the home of Glen Taylor’s Timberwolves. According to the latest Forbes ranking, Glen Taylor is Number 242 on the list of the richest persons in America with a net worth of $1.8 billion, and the Neighborhood Revitalization Program has been starved out of existence. Is that the best deal we could get with Glen Taylor? Is this the best investment in Minneapolis’ future?
The basic services that a city is supposed to provide are police and fire protection and street maintenance. Those are the essential services. And the delivery of those services is the basis on which a city is ultimately judged.
Last month we published an evaluation by Tony Bouza of his tenure as Chief of the Minneapolis Police Department. It’s worth repeating: “The waste is horrific. A bloated officer corps (I encountered 22 captains and needed nine; 110 lieutenants and needed about 35, etc. etc.) About 1 to 2% of the force were psychos, thumpers, alcoholics, criminals, racist bums or loads, but I could not fire them because of the union and civil service laws. This tiny number served as a pervasive incubus on the larger body. There were six precincts—we needed four.
No one had ever heard of 911. We adopted it in NYC in 1968 and in Minnesota in 1983. Hardly any minorities or women. All two- person patrols. No use of name-tags. I demoted some; froze promotions for nine years and failed utterly to basically fire anyone (maybe a couple). The union opposed everything—through the courts, civil service commissions, the City Council and anywhere else they wielded clout. For the nine years I served as chief I watched overtime expenses, possible lawsuits and such with a heady eye and returned a surplus eight of those nine years. My reward was to be summoned to the Council chambers to face angry officials complaining they’d given me the money to spend and why hadn’t I?”
It seems the only thing that’s changed is that the inmates are now in charge of the asylum.
Chief Tim Dolan is a local boy made good. He was raised on the Northside, had a paper route on Broadway and Emerson, got into a lot of trouble as a kid—set the local nun’s Christmas cards on fire, hijacked a bulldozer for a joy-ride (earning a felony in the process), found a home in the Minneapolis Police Department and he’s been there for almost 30 years. There are certainly pluses to promoting local talent, but there are negatives as well. Especially in the case of a police department. It can promote cronyism. Police work is tough and dangerous work. You depend on your partners, your fellow officers, to stand by you and save your life if need be. As Dolan himself has said, “It’s an adrenalin junkie’s job.” And it creates a bond that is not easily broken. Maybe that’s why Dolan has had such a difficult time disciplining his officers. In 2008 and the first three quarters of 2009 the Civilian Review Authority (CRA) sustained 25 cases and forwarded them to Dolan. In only three of those cases was discipline imposed. CRA found 37 officers had engaged in serious misconduct, and Dolan wrote letters of reprimand to three of the officers and gave an oral reprimand to two others. A district court ordered Dolan to begin listening to the CRA, with little effect.
The other danger of cronyism is that you like to reward your friends with a cushy desk job. The total number of Minneapolis police officers has gone down from 1,092 in 2009 to 999.2 in 2010, to 992 in 2011, and Rybak is proposing 967.8 for 2012. Shrinking budgets mean cuts in labor, but who is being cut? Is it the cop behind the desk or the cop on the street? Patrol officers, the ones who do the real work, were at 720 in 2009. Rybak is proposing 640 for 2012. To punish a Roman legion if they behaved badly, the emperor would decimate their ranks. He would execute one soldier out of ten. That emperor would have been better for the citizens of Minneapolis than Rybak because that decimation would have meant a net loss of only 72 patrol officers instead of the 80 Rybak is proposing. And, at the same time, Rybak and Dolan are proposing an increase of 11.5 positions in police administration. Every cop wants to get out of the patrol car and behind a desk. Bouza understood that and stopped it cold. Rybak and Dolan, on the other hand, are taking the department in the opposite direction.
Effectiveness in the Fire Department is being compromised as well. Fire emergency response positions have been reduced from 406 in 2009 to 400 in 2010, to 379 in 2011, and Rybak is proposing reducing that number to 301.25 in 2012—cutting the front line of defense against disaster by one-fourth! That seems to be taking a tremendous gamble with public safety. Let’s hope someone on the City Council asks him about that cut in front line response when they review the budget.
The Public Works Department is proposing losing 10.18 positions in street maintenance and repair. That means the potholes will get bigger and deeper. On a personal note, I lost two tires and damaged two wheels beyond repair because of potholes this spring, but my daughter fared much worse, she lost an axle.
Cutting back on an already overworked department is a further sad sign of the deterioration of our city.
The mayor is proposing cutting eight positions in Community Planning and Economic Development (CPED). That still leaves 120 people to dream up fancy fountains and new bike racks. It is impossible to understand, based on the budget proposal, what CPED does and who is doing it. One item on page 354 lists proposed contractual services for 2012 as $4,305,567. I asked Heather Johnston from the Finance Department about it. She seemed shocked and said it must be a mistake. She said she’d get back to me about it. I never heard from her again. In another section contractual salaries increase from $110,832 in 2009 to a proposed $296,576 in 2012. If they’re going to cut positions and then add much more in contractual expenses, then there doesn’t seem to be much savings for the taxpayers.
There are few options available for the City to raise revenue. The property tax is just about the only tool that can be used without getting new enabling legislation from the state legislature.
A more progressive legislature would allow the City to levy a payroll tax. A small tax of one-tenth of one percent of the salary or paycheck on people who worked in the city would finally allow those people who drive into our fair city from the suburbs to make a living the opportunity to contribute to the cost of the roads and police and fire protection that make their employment possible.
One other source of revenue that has been sorely neglected is the franchise fee the City charges utilities to operate in our city. Currently the City collects $27.8 million in fees from the gas, electric and cable utilities. This fee barely covers the cost of the City allowing the utilities to use our telephone poles and utility tunnels. We can charge these utilities anything we wish, and we need to raise these fees immediately. The City is experiencing a financial crisis and the franchise agreements should be re-opened and re-negotiated. Instead, the City is taking a passive attitude and is actually reducing the amount from franchise fees to $27.5 million for 2012. Also, the City does not assess a franchise fee to USI Wireless for their exclusive monopoly on wi-fi. If USI Wireless wants exclusive rights to wi-fi, then they should pay for them.
We elect our mayor and City Council to sit down and negotiate a fair contract with city employees and with utilities that serve our city. We have every right to expect that these officials will be negotiating on our behalf. Further, we have a right to know if any of the parties across the table are contributors to our officials. Do they contribute time or money to their political campaigns?
Why else would they give away the store to the hotels, Glen Taylor and the Timberwolves, the MPD, the Planning Department and the utilities? Minneapolis property taxpayers are paying their share, it’s time for others who benefit from this city to pay their share as well.