2024 Budget Update from Mayor Frey

Update on the 2024 Budget

On August 15, I delivered my 2024 recommended budget to the City Council. The proposal features a continued commitment to affordable housing, historic investments in long-term, sustainable climate action, and funding for the federal consent decree, inclusive economic recovery work, and park and public waters improvements.

The proposed 2024 budget totals $1.8 billion, with a tax levy increase of 6.2% – which is the exact levy increase I promised last year, no higher.

Since then, the City Council has been working on amendments to my proposed budget – as is done each year through the regular budget process. Tomorrow, Council will begin budget "mark-up" and on Tuesday, December 5, the Council is slated to take its final vote on the budget. Once it is passed through Council, it comes to my desk for final approval.

Impacts the Council Budget Amendments will have on City Services

This morning, the administration sent the City Council a memo outlining the impacts of the various budget amendments the Council has submitted. This information is directly from the departments themselves that will be impacted by these amendments. We have to listen to our staff, they are the experts in their field.

As a follow-up to my administration's memo, I sent the City Council a letter this evening outlining my grave concerns with a few budget amendments.

The full text of my letter to the City Council is below: 

Council President Jenkins, Council Vice President Palmisano, and Council Members: 

Thank you for your collaboration so far this budget cycle. I look forward to continuing to work together towards a budget that supports the services we provide to Minneapolis residents.  

The collaboration started earlier this year with invitations to all Council Members to provide their budget priorities for consideration in my proposed budget. As you heard during my budget address in August, those requests were in large part included – and remain in my proposed budget today. 

We did this out of a sincere desire to work with you in a collaborative process, to provide for our constituents. I want to thank you for your willingness to engage, both then and now. 

This morning, you received a memo from the administration outlining the impact of some of your proposed budget amendments. Staff worked diligently yesterday to review the amendment packet and provide this timely memo so you have important and relevant context moving into mark-up on Thursday. This context is directly from the departments themselves that would be impacted by these amendments. They are the experts in their field, they know what is needed to do their work, and we should listen to their advice and recommendations.

I hope you make time to review the memo document. If you have any questions, I know both interim COO Johnston and Commissioner Barnette have offered to make themselves available.

I’ve been reviewing the 48 proposed budget amendments, too. There are amendments I agree with, some I can live with, and others that I am adamantly opposed to. This letter is meant to highlight the amendments I have grave concerns about as they will limit our ability to provide the level of service our residents need, and that Council has committed to provide. 

Cuts to HR FTEs dedicated to enterprise-wide recruitment and retention efforts   

First, we need to invest in our City workforce. More often than not, significant backlogs occur across the enterprise because Human Resources (HR) is under-resourced and overworked. I understand that HR staffing is not the most exciting proposal, but our whole enterprise depends on them to run smoothly.  

I proposed adding 8 FTEs to HR (4 of which are being made permanent following ARPA funding) to build capacity within the department to support the recruitment and hiring of new employees and to help with retention efforts. There are several amendments that would dismantle these HR FTEs and move them elsewhere.  

I do not support moving these FTEs out of HR. Why? Because that means positions will not get filled quickly, work will be delayed, and important projects we all support will fall short. Moreover, new employee orientations will be scaled back, support for all employee benefits and open enrollment will be greatly reduced, and the Talent Acquisition team will cancel 2024 recruiting events scheduled in underrepresented communities... just to name a few. 

We have to double down on our investment in the City enterprise and that means investing in our incredible staff through the HR department. 

Cuts to the Public Works snow storage site   

We live in Minnesota. We get a lot of snow during the winter... and we need a place to put it. Our residents deserve streets and parkways that are plowed and completely cleared of snow. This is a basic, bread-and-butter City service that we need to provide.  

The proposed $1 million investment in an improved snow storage site is crucial to allow for a place to dump the cleared snow. And allowing the snow to run off in the river is bad for the river. The amendments that eliminate the budget for this site would hamper the City’s ability to haul the snow and properly dispose of it. 

Cuts to PMI FTEs planned to advance Safe and Thriving Communities Report   

We need to implement the recommendations coming out of the Minneapolis Safe and Thriving Communities Report. I know these recommendations are supported by both my administration and the Council. To help guide this safety beyond policing work, we proposed maintaining the staffing level in the Performance Management & Innovation Department (9 FTEs). The proposed amendments reduce the department by more than 50% and undermine the work we need them to do.  

These cuts would mean significantly reduced capacity to lead and support the Minneapolis Safe and Thriving Communities Report implementation. There would be reduced capacity to drive on other innovation projects, to support the research and best practice identification of community-based safety center programming, to integrate performance management with the budgeting process, and elected officials and departments will not have the support they need from PMI to make data-driven and evidence-based decisions that advance City goals.  

All of this means that improving the delivery of City services to enhance residents’ quality of life and eliminate racial disparities will be impacted. We don’t want that, and our residents don’t want that. 

This would be the third time the current Council’s position has changed on these PMI FTEs. In 2022, upon request from a Council Member, we moved the PMI positions to the legislative branch in our proposed budget. The City Council then changed directions to move the PMI positions back to the administration and advocated for the creation of an independent department – to which we agreed.  

Now, these amendments would move the positions... yet again. Importantly, since the Council made the decision to move the PMI FTEs back to the administration and create a standalone department, we have been building out a team integrated into our implementation plan for the Safe & Thriving Communities Report. This back and forth, and back again, makes it nearly impossible for staff to plan effectively, and even harder to deliver on objectives that we all want.  

Use of $19 million one-time public safety aid   

I understand this Council has rejected the proposal to use the one-time, State money for police officer incentives. As I’ve stated, I disagree. But if this money is to be used for a different purpose, I strongly suggest that you get buy-in from the people charged with implementing the work. Promising new pilots from the Council dais without input from our expert staff could result in empty promises. 

We have already jointly promised to move forward with the Safe and Thriving Communities Report recommendations. Let’s deliver on this promise, together, and devote monies to implement these recommendations rather than creating new programs with one-time dollars, that have neither been studied nor vetted by staff.   

As the City’s leading subject matter experts have already relayed to you, the proposed amendments above pose grave governing concerns. 

I want to clearly tell you now: these amendments will negatively impact our ability to provide service to our constituents and deliver on the promises we have made.   

I ask you to consider the impacts listed out in the memo and go into mark-up on Thursday with an open mind for finding areas where we can compromise. This will require both the executive and the legislative bodies to find common ground. I know we can do it.  

Yours truly,

Jacob Frey