Meeting Information

• Date: September 9, 2024
• Title: Budget Committee Meeting
• Present: Payne, Wonsley, Vetaw, Cashman, Chavez, Chowdhury, Palmisano, Koski, Chughtai
• Absent: Rainville, Ellison, Osman, Jenkins
• Guests: Budget Director, MPD Deputy Chief Travis Glampe, MPD Finance Director Vicky Runkle, CIO Paul Cameron, Assistant City Attorney Adam
• Votes: 0

Highlights

• Overview of the 2025 City Budget presented by the Budget Director
• Presentation on the budget related to the Minnesota Department of Human Rights Settlement Agreement and U.S. Department of Justice Consent Decree
• Discussion of the Public Safety Aid allocation and its impact on the property tax levy
• Presentation on the Police Department’s implementation team for the Settlement Agreement
• Information Technology budget proposals related to the Settlement Agreement

Discussion

2025 City Budget Overview

The Budget Director presented an overview of the 2025 City Budget, highlighting key changes and challenges. The budget totals $1.8 billion for 2025, increasing to $1.9 billion in 2026. The property tax levy is proposed to increase by 8.1% in 2025 and 9.8% in 2026.

The director emphasized that expenses are growing faster than revenues, creating a budget gap. Personnel costs, settlement agreement requirements, and declining property values were cited as major factors contributing to the budget challenges.

Council members asked questions about specific funds and allocations, including the Permanent Improvement Fund and the use of cash reserves. Council Member Palmisano expressed concern about maintaining the city’s AAA bond rating:

“I’m a little bit concerned about how we maintain our extremely important AAA rating. I was wondering, Director, could you opine briefly about what are the fund balances that go into determining that AAA rating?”

The Budget Director explained that bond agencies look for sustainability in finances and a long-term strategy, which influenced decisions such as removing the use of cash from outyears in the budget plan.

Settlement Agreement Budget Impact

Officials from various departments presented on the budget impacts of the Minnesota Department of Human Rights Settlement Agreement and the U.S. Department of Justice Consent Decree. The Police Department is requesting nine new positions over 2025 and 2026, while the IT Department is requesting three positions primarily for a data transformation project.

Council members raised questions about the longevity of these investments. Council President Payne asked:

“Are these investments systemic investments for us internally to maintain the compliance even after we have finished the settlement agreement, or do we envision the investments being somewhat temporary in terms of the duration of the agreement?”

Jared Jeffreys from the Office of Community Safety explained that many of the investments are intended to continue beyond the duration of the agreements to institutionalize changes and prevent repeating past issues.

Public Safety Aid Allocation

Council Member Chavez raised questions about the use of Public Safety Aid to reduce the property tax levy impact. He suggested that if the Council had not previously voted down certain allocations of Public Safety Aid, the levy increase might have been higher. The Budget Director acknowledged that without the $4.5 million of Public Safety Aid being used to offset the levy, the increase would have been slightly higher, potentially in the “upper 8s” as a percentage.

Police Department Implementation Team

Deputy Chief Travis Glampe presented on the Police Department’s implementation team for the Settlement Agreement. The department is gradually increasing its compliance team, with plans to have six compliance specialists by 2026. Glampe emphasized the responsible approach to building out the team:

“We’re taking a very responsible approach to building this team out. We started with two people. They’re more than busy now. Next year we’ll add two more. And then by time we get to 2026, we’ll be up to six people. We’ll have a good sense, at that point.”

IT Budget for Settlement Agreement Compliance

CIO Paul Cameron presented the Information Technology budget proposals related to the Settlement Agreement. The department is requesting approximately $2 million in 2025, $4 million in 2026, and $3.2 million in 2027 for a data transformation project. This includes funding for professional services, software tools, and new FTEs to build institutional knowledge and increase capacity for data utilization.

Public Comments

There were no public comments during this meeting.