Council President Elliott Payne, Council Vice President Aisha Chughtai, Council Member Robin Wonsley, Council Member Michael Rainville, Council Member LaTrisha Vetaw, Council Member Jeremiah Ellison, Council Member Jamal Osman, Council Member Katie Cashman, Council Member Andrea Jenkins, Council Member Jason Chavez, Council Member Emily Koski, Council Member Aurin Chowdhury, and Council Member Linea Palmisano; City leaders; and community partners—thank you for joining me for my 2025 Budget Address.

Thank you to our City leaders from across our departments, our budget and finance team, and my staff who have made this budget possible.

Thank you to my Council colleagues for your collaboration. It’s been no secret that this year’s budget looks different, but your input has been invaluable. While this is my recommended budget, I hope you see your good guidance and advocacy reflected throughout. 

Thank you to our Board of Estimate Taxation Commissioners—you have an important role to play. Protecting the Minneapolis taxpayer through the City’s maximum levy. I can assure you a tremendous amount of work was undergone with that sentiment in mind.

This budget cycle also piloted a new approach to community engagement. We gave several community groups a deep dive into the City’s budgetary process. We explained the levy, budget proposals, and provided a live simulation that shows how a decision to fund or cut has several externalities that may or may not be intended. And upon learning the circumstances of this year’s budget, they provided phenomenal feedback. A special thanks to the Minneapolis Youth Congress, Minneapolis Advisory Committee on People with Disabilities, and several of our community’s Hmong and American Indian leaders, many of whom are with us today. We learned a lot and intend to expand this pilot to include new voices and communities in future conversations.

A way through

Today, we find ourselves at the intersection of well-earned success and uncomfortable transition. Nobody should downplay the renaissance Minneapolis is presently experiencing:

• Our downtown was ranked number one in the country for best rebound activity;
• We’ve been named the happiest city in America;
• We’re the best spot for recent college grads;
• We’re top five in the nation for accessibility;
• And, again, we’ve been nationally recognized for our world-class parks and bikes systems.

But more important than those accolades, is the work our City does every day for the people of Minneapolis. We often talk about the money we’ve invested but forget to circle back on the impact it’s had. And I want to take a quick moment to do just that.

Over the last 6.5 years, our investments and policy have made us a national leader in affordable housing work and provided thousands with the most basic human need: a home.

Our investments in climate work through the franchise fee, an estimated $10 million dollars annually, tees up Minneapolis as a beacon of forward thinking, earth-saving, climate-focused work.

For generations, North Minneapolis has been cut off from the riverfront. No longer. Now as you walk down Dowling, you don’t hit a dead end of dusty, vacant land. Working together with our Park Board, United Properties, First Avenue, and so many others, Northside residents are able to actually touch the water of the Mississippi River and take a stroll along its banks in a beautiful park.

And we’re not stopping there, North Minneapolis is getting another park. We’re talking Disney World level (almost) upgrade at North Commons, that I have a feeling will not just be a community asset, but a destination for families around the city.

Plans for George Floyd Square are moving forward. Options have been laid out, partnerships have been forged, and a clear vision for healing and hope is taking shape.

And as you know, we’re all rallying around a South Minneapolis Community Safety Center which will be a reality early to mid-next year.

These investments are aligned with the values I’ve had since day one. And a difficult budgetary cycle doesn’t mute the core values guiding our shared work.

A new year

At the same time, the reality of governing and budgets is that one year may look completely different from the next. And this year, we’re faced with a few realities. Inflation and significantly higher but necessary labor costs have increased the cost of delivering excellent City services. The spend down of ARPA funds and a reduced valuation of office buildings have shifted the impact of those costs to homeowners and renters through increased property taxes. In past years, when departments had brilliant ideas or need additional capacity, we could say yes to a lot more. This year, not as much.

Based on revenue projections for the year, we learned early that just maintaining City services would result in a $21 million deficit, or roughly a 11% levy increase, and with new required investments we would be looking at a 13% levy increase. That would have been acceptable to nobody. That’s why I asked my administration to find ways to do more with less. I’m proud to say we did.

• Our Public Works team is minimizing costs by replacing non-networked EV chargers with networked chargers so our fleet can charge during off-peak hours when the cost of energy is less expensive.
• We are sunsetting the Commercial Acquisition Revolving Fund in CPED, saving $500,000 on an annual basis.
• Instead of asking for new funding, our 311 and Service Center teams reallocated existing resources to cover unanticipated costs – including more translation services and overtime for large events like the Taste of Minnesota, USA Olympic Trials, and Pride.
• Our Emergency Management team leveraged Federal resources to train 65 City staff on the National Incident Management System back in March – and will continue regular training and exercises to prepare our City for emergency events.
• We’ve increased our use of cash and re-allocated federal grant funding, still maintaining necessary reserves and contingencies but maximizing the use of funds we already have on hand. This includes an increased transfer from the Downtown Assets Fund to more fully cover the critical economic development work underway.

Thanks to our City team’s creative leadership and thoughtfulness, we’ve managed to do what felt like a pipe dream a few months ago: keep the levy increase under 10%.

Through efficiencies and many hard choices, we’ve managed to drive the levy down to 8.1%.

I am not expecting us to celebrate this lift, because our residents have a new lift of their own with increased property taxes.

But what this budget provides is a way through. We’re doubling down on programs that work, we’re ensuring our resources are used effectively, and we’re making sure our community feels the benefit.

The tough decisions we made to get down to an 8.1% levy will continue throughout next year. We will analyze staffing levels and program efficacies to best provide excellent services to our residents without overburdening their bottom line.

At the same time, we expect our residents over the next year to hold us accountable. To make sure we’re using tax dollars wisely and implementing cost-saving measures where they exist.

My administration will do its part.

Our Performance Management and Innovation Department is launching Outcomes Minneapolis, which supports departments in achieving their missions, aligning priorities, making data-driven decisions, and driving progress towards City goals. Through this program, we’re developing deeper metrics to analyze program efficacy. Where results are clear, we double down. And where they are lacking, we admit it and change course.

It's also important to note what goes into our levy. Included in our overall City spend, are the levies for the Minneapolis Park and Recreation Board and the Housing Redevelopment Authority (HRA), which goes to the Minneapolis Public Housing Authority. Last year, we re-activated the HRA levy, providing $5 million dollars on an annual basis to the MPHA to assist in the preservation and expansion of public and deeply affordable housing in Minneapolis. We are not walking away from our core values of getting more residents into safe, stable, and permanent housing and we’re proud to continue this work by ensuring that levy’s continuation.

Over the last few years, we’ve increased park funding by close to $10 million and for good reason. The work to improve youth recreation, parkway paving, and water quality help maintain the top-in-the-nation ranking for our Minneapolis parks. For generations, going back to Theodore Wirth, our commonly owned park land has not been sacrificed for private interests or budgetary fixes, and we won’t start now. This year, our independent Park Board, who have themselves experienced increased costs from materials to labor, will see the$3.6 million increase already committed plus an additional $2.2 million to cover new costs and continue the great work for which their known. This amounts to a 7% increase for the Park Board, bringing the levy to nearly $88.5 million for 2025.

Huge portions of next year’s budget are essential. One being our employees.

We have to fill potholes and plow snow. We also have to retain and recruit our wonderful employees who do that work. Doing so has resulted in significant cost increases for every government and business over the last few years. Why? Because those employees have seen their own costs increase.

Our employees inspect buildings, take care of shelter animals, and save lives. They also feed their families, pay for daycare, and have medical bills. The increases in employee salaries are provided because we value our employees and the residents they serve. We are not at all unique in seeing these labor costs. The difference is we, as government, show those increases transparently. And, by the way, these increases have had a positive impact.

• We have a turnover rate of 3.9%, way below the average of most other cities.
• Applications are up 62%
• And we’ve been nationally recognized for being a Women-friendly and LGBTQ+ friendly employer.

A couple of years ago, we were struggling to retain employees, and now we’re recruiting and retaining the very best. And our very excellent employees are providing very excellent services.

• At the Convention Center, Jennifer Johnson is passionately leading a new Sustainability Committee, embracing our city’s climate goals and putting them to work. Her team has helped reduce water use by 50%, reduce power use by 16%, and maintained a recycling rate that reached 65% last year. Overall, these efforts have led to a 77% reduction in carbon greenhouse emissions.
• Over at Minneapolis Animal Care and Control, we have staff like Madison Wesissenborn, who helped start our Fido Field Trips. This program lets residents take shelter dogs out on a field trip for the day. Since May, more than 1,100 people have signed up to partake in the new program – which has led to an increase in adoptions.
• At our Minneapolis Emergency Communications Center, staff have worked hard to open a new 911 center and decrease vacancies. The center will soon be its highest staffing levels since 2020, at 88%. And because of this, they’ve improved their call answer time to 78% within 10 seconds, with a goal of 90%.

So yes, our workforce—past and present—are worthwhile and necessary investments.

There’s another essential. Police reform.

Community Safety

From our Commissioner, to our Police Chief, to our entire community, everyone is galvanized around proactively making change in our Police Department. The nature of that change will be formalized in a consent decree with the Department of Justice and the work we’re already doing to comply with the Minnesota Department of Human Rights settlement agreement. Adopting a consent decree does not indicate completion of the work. Rather, it formalizes the targets. We’ve heard from experts that achieving those targets requires resources, from training to personnel. So, we aren’t waiting for the ink to dry on a formal agreement, we’re building out the team tasked with compliance now. We need to get people on board, trained-in, and aligned in our mission. We’re investing now so we don’t find ourselves behind later.

We’re dedicating $1.3 million in new staffing for the multi-departmental implementation team and dedicating additional resources to accomplish an enterprise-wide data transformation. That upfront investment will cover experts in adult learning tasked with overseeing training; staff with the skills to evaluate and audit officer compliance with the agreement; and overhauling our data systems. And more than $20 million of our consent decree funding is going toward facility improvements, including $17 million for our Southside Community Safety Center. This first of a kind project will bring together a multitude of safety resources under one roof – from police to violence prevention, to perhaps other alternatives we haven’t thought of yet.

There is near unanimity of agreement: We all want this safety center to succeed. And we want our residents to feel connected to it from the first moment they call for help or walk in the door. With a $220,000 investment, we can hire staff to be our first touch point with residents. They will greet constituents, take non-emergency reports, and connect residents with the City services and community resources they need.

Often times, the needed resource is response from a police officer, which over the last several years has been in short supply. But today, through a strategic recruitment campaign called Imagine Yourself, robust outreach to potential police candidates, and substantial work from our police chief and beyond, I’m proud to say we are now seeing positive results. Applications are up, more candidates are coming through our doors, and we will continue this campaign’s momentum with another $500,000 in 2025.

To onboard more police officers, we also need to reduce the time it takes to vet and process applicants, so they turn into hires rather than deciding to pursue another profession or department. With $385,000 to increasing the pace of background checks, we can hire faster, vet applicants faster, and get the best candidates into our program and out on the street faster.

Also important: our safety-beyond-policing initiatives. Take our Behavioral Crisis Response team for example. Our $5.9 million-dollar commitment to this team will continue, providing funding levels for 24 hour a day service across the city. We know police aren’t the answer for every crisis situation. Our BCR team meets people where they’re at, providing caring support when it’s needed most. Since they started, they’ve responded to more than 20,000 calls and that number keeps going up. It’s clear, their work is critical and we’re proud to support them.

We also have new tools that provide more efficient safety responses. I’ve heard from residents and officers alike that our police should be focusing on serious crimes. But relying on officers less for lower-level offenses like traffic violations means relying on technology more. Through a $1.2 million investment in a new traffic safety camera initiative, we will use staff time more efficiently while responding to a problem we’ve heard loud and clear from our constituents: reckless driving. Blowing a red light doesn’t just break the law, it can result in someone losing their life. We know far too often people are violating the law without repercussions. Thanks to a change in state law this past session, there will soon be consequences. But more importantly, we hope this investment will save lives.

Capital projects

A big part of any budget is devoted to capital projects, which are typically funded through our City’s bonding authority. We’re able to borrow more money to pave more streets when lenders know they’re going to get paid back. If banks have less confidence in our ability to repay, we get less money. Therefore, can pave fewer streets.

So, when in November of 2017, Minneapolis’ credit rating was downgraded to AA+, it reduced the number of City projects we’re able to fund because the cost of borrowing went up. But since then, our City has been upgraded to the highest rating available—AAA—thanks to smart fiscal planning by award-winning staff, including our top-rated government CFO, the City’s bond team, and our amazing budget director. This means we have high financial resiliency and can withstand budget variances – helping us lower our interest rates for bonding, and in turn, making more progress on City projects our residents care about. Here are a few examples:

• $17 million in bonding for the Southside Community Safety Center wouldn’t be possible without smart fiscal management.
• The $1.2 million increase in 2025 for parkway paving – and $2.2 million in 2026 wouldn’t have happened but for the faith and credit in Minneapolis. And we have $59 million of bonding devoted to paving projects from 2025 to 2030. This is extra money that would not be possible if we hadn’t leveraged our debt capacity.
• Nor would the 3,000 City-owned streetlights recently converted from high pressure sodium to LED lights, and the resulting 3,000 tons of CO2 emissions saved.
• Reconnecting Nicollet at Lake in South Minneapolis, the City’s Vision Zero work to eliminate severe and fatal crashes, and our 1,200 new ADA accessible curb ramps -- all can be carried out due to smart fiscal planning.

Economic inclusion

In the area of economic revitalization, Minneapolis has experienced a magnificent comeback. Not based in a return to the old normal, but one that sets the foundation for change. Part of that change is happening downtown.

This year, downtown Minneapolis saw the biggest jump in foot traffic nationwide. You can feel it on the streets, you can see it in the numbers. In June, we hit a record month for hotel revenues, not just since the pandemic, but all-time.

The momentum and pace of change must continue.

Let’s begin with Nicollet Mall. Envision Downtown as a playground: we could skate down the mall in the winter and open it up to festivals and markets in the summer. Minnesota’s Main Street could truly be that. We’ve talked about getting the buses off Nicollet Mall, and that’s the plan. But then what? A mall without buses but with nothing to do is unlikely to generate excitement, so we’re getting going by investing $550,000 to activate Nicollet Mall.

Let’s open the floodgates of ideas. We could have ice rinks, ziplines, two-block-long ice bars, dog parks, a Ferris wheel, and art—a whole lot of art. Art is a catalyst of transformation and creativity is a driving force of change.

You may have heard we’ve rolled out our Vibrant Storefronts Initiative to help beautify and revamp vacant storefronts across downtown. Head over to Harmon Place starting this fall and see for yourself. We’re filling vacant storefronts with color, beauty, and the creativity of our local artists. Because the initiative is working, we’re investing $1.43 million to keep it downtown – and expand it into Uptown and cultural districts.

And what about Uptown?

Uptown’s history is woven together with creativity. In the past, art was the instigator of increased values and now through the expansion of our Vibrant Storefronts Initiative, art won’t just be an instigator, but a mainstay.

We’re expanding support for small, locally owned businesses through a $300,000 allocation to our Business Technical Assistance Program, a third of which will go to Uptown. Upstart small business owners already have a steep curve, but by providing financial and marketing support we can help them scale an idea.

We don’t want a great idea to be the cause of displacement, we’ve seen this trend time and again. An entrepreneur creates a popular business, which boosts customer traffic, and also the rents. The premise behind our Ownership and Opportunity Fund is that the business owner should reap the benefit from the increased value and are better able to build generational wealth for their families. Twenty-four business owners have already realized this dream through the fund, and we’re proud to keep the pipeline flowing with $2 million in 2026.

At George Floyd Square, people need to know forward progress is happening. They want to know how the street, layout, memorial, and “People’s Way” will honor our history and improve their neighborhood. Action is finally afoot, and we are investing in a plan to get us there. With $300,000 in the budget for art preservation at George Floyd Square in 2026, three options for street layouts provided to residents, and a final decision expected within months, the people of our city will see progress. The historic art that our community has created will be maintained, and a grand vision honoring the history and pointing toward the future will be made.

Affordable housing

While budgets and finances change, our values don’t. From my very first budget as mayor, we have made record investments in affordable housing and achieved record results. We are presently producing 6.5 times the amount of deeply affordable, low-income housing than before this administration took office. This budget ensures that trajectory continues.

With a $17.9 million dollar investment in the Affordable Housing Trust fund, we are producing a record number of homes for people who need them.

One form of affordable housing that has often been overlooked: our public housing stock. Last year we changed that by reestablishing the Minneapolis Public Housing Authority levy and increasing the allocation five-fold. The impact cannot be overstated. That money can be used for important safety upgrades like sprinklers, deferred maintenance and repairs, and it can increase the number of public housing units in our city to provide homes for the thousands of people waiting in line.

This year, we’re holding strong on that commitment, and we are charting a new, trail-blazing path that could set the example for other cities to follow. Few cities in the country have successfully used HUD’s Faircloth to RAD program to produce more housing units. We’re going to be one of the first and the Spring Street High Rise in Northeast will be the test. If this is successful, our $1.3 million allocation will leverage tens of millions more, and it will solidify an innovative blueprint to provide exponentially more public housing. In Minneapolis we can lead, and in the area of public housing we are doing just that.

And just for the record, our strong support for homeownership will continue with an additional $1.5 million - helping us continue our march toward building generational wealth for our Black community that has been historically deprived of it. Also, for the record, we will continue our ongoing commitment to the ground-breaking program Stable Homes Stable Schools. With a $2.2 million ongoing investment, we can add to the over 4,800 kids we’ve successfully housed, preventing homelessness and providing important support for the Minneapolis Public Schools they attend. Finally, for the record, we will also be continuing a program to help low-income homeowners address outstanding housing orders and remain in their homes. These are small investments that have shown large dividends increasing housing stability.

While safe, stable, and permanent housing is the end goal, we know it’s not a reality for all residents. Just like most cities across the nation, Minneapolis is working to address unsheltered homelessness.

In the last two years, we’ve made progress. Hennepin County figures show a nearly 25% reduction in the number of people sleeping outside. This is due to key investments we’ve made – like increasing deeply affordable housing 6-fold, adding new shelters to our system, and working with partners like the County to provide culturally sensitive support and wrap around services.

And still, we need to do more. That’s why, I’m proposing investing nearly $1.5 million in homelessness response. I’ve heard from Council Members they want more outreach and support for residents: it’s in this budget. I’ve heard from unhoused neighbors that more storage space would help: it's in this budget. And I’ve heard from our residents and Council Members that they have health and safety concerns regarding encampments. There will be times when we need to close encampments. With this budget, we have the tools to do so humanely, and when we can successfully connect a person to housing or shelter, we will.

Climate change

Anyone who works at the City of Minneapolis is here to make a lasting impact—a legacy. There is perhaps no greater legacy than protecting our planet.

This budget presented a challenge between honoring commitments and recognizing the impact those commitments could have on taxpayers. That tension was felt acutely in our decision to continue the franchise fee allocation estimated at $10 million committed to our Climate Legacy Initiative. But for all of us, it was a commitment worth honoring. Through our Climate Legacy Initiative, we are continuing our march toward home weatherization in our city’s Green Zones, neighborhoods in both South and North that have been impacted by high rates of pollution, which will reduce our per capita carbon footprint and help bring down energy bills for people that don’t have a ton of expendable income.

We’re also planting more trees, expanding green jobs and training, investing in EV charging infrastructure, and we’re poised to be the first city in the country to start producing biochar, a tool that helps remove carbon from the atmosphere.

On the issue of climate, there is no time to waste.

Speaking of waste, we’re trying to get down to zero of it by 2030 through our Net Zero Waste Plan. With a $300,000 investment --- we're launching our initiative to minimize the amount of waste generated and maximize the recovery of resources through recycling, composting, and other waste diversion methods. Our goal is to achieve functional zero waste, even as waste generation is projected to rise.

Rising higher

The budgetary transition we’re experiencing does not negate the well-earned success our city is seeing. On many fronts: the times they are a changing, and we have to change with them.

The way people use downtown is changing, and so we must adapt downtown to a new future.

The way property taxes are collected is changing and we must find new revenue streams that don’t disproportionately impact our most at-need neighbors.

Costs in many areas have risen, and it’s on us to change our practices, to find efficiencies, and yes, make data-driven and necessary decisions on when and what to cut.

While change can be uncomfortable, we will find a way through. We always have. And during that transition, we will not compromise our core values.

Our planet demands work to reduce carbon output, and in Minneapolis we can take steps to deliver.

People need the stability of a home, and in Minneapolis we can continue leading the nation to provide affordable housing.

Our streets need to be safe—a top priority for any municipality—and in Minneapolis we can do both innovative and honest work to make that happen.

A changing city rises. And our great city is rising. And we will all rise higher because we are committed to finding a way through together.

Thank you for loving Minneapolis.

This is the speech as prepared, not a transcript.