Updated: August 14, 2020 09:37 PM
Created: August 14, 2020 06:09 AM
Friday, Minneapolis Mayor Jacob Frey gave his 2021 budget address.
Frey shared how the city might financially navigate two major challenges: the ongoing pandemic and calls for police reform following the death of George Floyd.
Frey said due to the ever-changing COVID-19 pandemic and work to rebuild the city, the budget projection will likely change before it's finalized, adding final numbers might be expected in about a month.
City council members have signaled they will try to address police reform in the budget negotiations that are expected to follow. That comes after their plan to put major public safety changes on the November ballot fell short.
Here are the main topics Frey discussed in his address:
Effects of COVID-19
In his address, Frey touched on ongoing unemployment in the city due to the COVID-19 pandemic. He also discussed health and economic disparities that have been made more pronounced due to the pandemic.
"COVID is impacting all of us, and all of us can do our part to make it better," Frey said in his address. "But we still need a matching commitment in the form of economic aid from our state and federal partners."
Frey said that due to the recession caused by COVID-19, revenue sources will decrease by about $32.5 million next year. Turning to an increase in property taxes alone to offset losses "was not an option," Frey said, as that measure would have resulted in an over-15 percent levy increase.
Instead, Frey is proposing continuing a city-wide hiring freeze through 2021. Frey also proposed reorganization efforts, having met with the heads of the city's charter departments. Frey suggested the creation of a "voluntary retirement incentive program," that would allow the city's longest-tenured employees to begin retirement early, which Frey claims would "save on payroll costs in the long run, and retain more diverse team members in the short run." Additionally, Frey proposed scaling back on programming dollars.
With those measures, Frey said the city would be able to limit the levy increase to 5.75 percent in 2021.
Fatal arrest of George Floyd
Frey said change is necessary after the death of George Floyd.
"We can and we must change how we approach policy and decision-making in Minneapolis," Frey said. "We find ourselves in a position to create a roadmap for cities across the country with detailed directions, for where to turn and how to reach a final destination. And our destination must be a more just, more fair and more inclusive city."
As part of the discussion on police reform, Frey said the city expects to see 100 vacant police positions by the end of 2020. Those positions will be included in the hiring freeze directive, Frey said. He added that "now is the time to accelerate community recruitment efforts," announcing the reinstitution of the 28 Community Service Officers that were eliminated in the 2020 budget revision.
Frey said he will "continue to welcome collaboration" with city council members on policing decisions. Frey said the city will also allocate about $2.5 million in new, ongoing funding to the Office of Violence Prevention.
Recovery from civil unrest
Frey said rebuilding the commercial and cultural corridors in the city that were damaged during unrest "is going to be exceedingly difficult work."
"Our preliminary estimates show that at least 1,025 buildings have been impacted," Frey said. "And more than 1,300 businesses, many of which are BIPOC and immigrant-owned, are reeling."
He added, "Our businesses and residents are staring down more than half a billion dollars in damages, thousands more in lost wages and business losses."
Frey said a designated coalition of community leaders is working to secure funding and support for redevelopment.
During his address, Frey proposed ongoing funding for the city's affordable housing programming. One program the city will be making permanent is the Stable Homes Stable Schools initiative. Through that initiative, Frey said the city has been able to house, or provide housing stability, for 330 families and 946 children.
The city council will now have an opportunity to discuss the budget in its regular meeting.
Meanwhile, a breakdown of St. Paul's 2021 budget is expected next week.
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