St. Paul property taxes might be hiked by more than originally planned

Sorry, St. Paulites, it looks like you might have to pay a little extra property tax next year after all.

Mayor Chris Coleman had proposed a 4 percent hike in property taxes earlier this month – which because of an increase in taxpayers in the city meant bills would actually have gone down for most homeowners.

But the breakdown in talks over a special session of the Minnesota Legislature to finalize the latest budget has left city funding in limbo, with St. Paul waiting on a $3 million boost in local government aid at state level.

To prepare for the "worst-case scenario" in the event this $3 million never materializes, MPR News reports Mayor Coleman has asked city officials to increase the property tax levy by 7 percent to cover this shortfall.

If the tax levy isn't upped, the city faces making cuts that would cost the city nine police officers, force one city recreation center to close, and reduce proposed racial equity initiatives.

KSTP reports that seven firefighter positions and five other new city job would also be eliminated under the cuts.

A letter sent by Coleman to officials, which you can read here courtesy of MPR, reveals the city is already making $1 million cuts as it faces an $11 million budget shortfall.

The Star Tribune reports St. Paul doesn't finalize its budget until December so the city has time on its side, but if a special session isn't called then it could have to wait until next spring to see if the city gets extra cash.

Coleman's counterpart in Minneapolis, Mayor Betsy Hodges, announced plans to hike the property tax levy by 5.5 percent in 2017 as part of a push to hire more police officers.

However, that increase already takes into account the hold-up in local government funding from the state legislature, so if a special session does get called and the extra cash gets released to cities, the tax levy hike would be reduced to 4.9 percent.

Gov. Mark Dayton said last week he won't be calling a special session this year, after the 2016 Legislature without an agreement on a tax bill and a bonding bill, after Democrat and Republican lawmakers failed to reach agreement on certain issues, including funding for the Southwest Light Rail.

Without an agreement on state funding for the light rail line, it could delay the project. Gov. Dayton is expected to meet with state and local leaders Thursday to discuss funding options for the rail line in what the Southwest Journal is calling a "last-ditch effort" to keep the project on track.