Budget Committee September 10, 2026   9/10/2026

Good morning.

My name is Aisha Chugtai and I'm the chair of the Budget Committee.

I'm going to call to order our adjourned meeting for Thursday, September 10, 2026.

Before we begin the meeting, I want to offer a friendly reminder to all members, staff, and the public that these meetings are broadcast live to enable greater public participation.

These broadcasts include real-time captioning as a further method to increase the accessibility of our proceedings to the community.

Therefore, all speakers need to be mindful of the rate of their speech so that our captioners can fully capture and transcribe all comments for the broadcast.

We ask all speakers to moderate the speed and clarity of their comments.

Councilmember Payne is absent.

Wonsley?

Present.

Rainville is absent.

Beto?

Present.

Warren?

Present.

Osman is absent.

Stevenson is absent.

Whiting is absent.

Chaudry is absent.

Palmisano?

Present.

Vice Chair Schaefer?

Present.

Present.

That is seven members present.

Let the record reflect that we have a quorum.

I'll also remind my colleagues that we're using speaker management today, so please make sure to sign in.

Our clerks are available if you are into any technical difficulties.

And if that is the case, we'll also use our flags just to make sure everyone's able to participate in discussion fully.

Today we begin the work of reviewing the mayor's 2027 recommended budget.

For both the public and my colleagues, I'd like to review the anticipated timeline at a high level in which we will complete the work of the 2027 city budget.

Over the next two months, this body will be receiving presentations diving into the details of each department's proposed budget.

We'll begin with a presentation during this meeting where Sean Green, our budget director, will provide us with an overview of the mayor's 2027 recommended budget.

Departmental presentations will continue throughout the months of September and October.

Council members have already received invites for all of these meetings and the meetings have been noticed for the public on the city's legislative information management system or LIMS at LIMS.minneapolismn.gov.

Additionally, this committee will hold several public hearings on the proposed budget.

The public hearing dates will be noticed once finalized.

Finally, I'll note that we'll begin to consider amendments to the mayor's recommended budget at our meetings in early December.

These revisions will be forwarded to the City Council for final consideration at a public hearing to be held at the meeting of the City Council scheduled for Tuesday, December 15th at 6.05 p.m.

We anticipate that following the adjournment of that public hearing, the City Council will adopt the budget and send it to the mayor for his signature.

As I said, our first presentation will be the budget overview presented by Budget Director Sean Green.

I will invite Director Green to join us and begin the presentation.

Thank you, Chair Tugtai.

Good morning, Budget Committee and City Council.

My name is Sean Green.

I'm the city's Budget Director in the Property and Finance Services Department, Finance and Property Services Department.

Today I will provide an overview of the mayor's 2027-28 recommended budget.

In the audience today, I am joined by the city's incredible budget division team who has worked tirelessly over the past nine months to get us to this point.

Justin, Ben, Liam, Enos, Daniel, Margo, and Bethlehem.

Thank you all.

This budget begins a new two-year cycle at a consequential moment for the City of Minneapolis.

The cost of maintaining existing services is growing faster than recurring revenues, while the City is also managing reserve pressure and known operating imbalances.

The recommended budget is designed to preserve core services while beginning to restore the financial stability needed to sustain them.

My goal today is to make that story clear for the Council.

Where we started, the pressures we are managing, the choices in the Mayor's recommended budget, and what those choices mean for the levy and the City's long-term outlook.

This presentation has five parts, a high-level budget overview, the processes and major decisions that shape the recommended budget, city revenues and spending, the property tax levy, and next steps, an additional section beyond our BET presentation last night specifically for the City Council.

The central distinction throughout this presentation will be between the city's structural pressures and the specific choices in the mayor's recommended budget made to address those pressures.

Much of the changes in this budget is not new programming.

It is the cost of continuing existing services and correcting gaps between adopted budgets and actual recurring costs.

I will begin with the basic scale of the recommended budget, followed by a brief orientation to the budget book and the information available to the board, council, and the public.

At the highest level, the 2027 mayor's recommended budget totals approximately $2.29 billion, with independent boards and transfers included, with forecasted revenue and other financing sources at that same level producing a balanced budget.

The budget supports approximately 4,285 city FTEs, a net decrease of about seven from 2026.

The general fund totals approximately $753 million when transfers and independent boards are included.

The recommendation includes $97.3 million for the Minneapolis Parks and Recreation Board, approximately $359 million in 2027 capital program funding across the city and park board projects, and about $12 million for the technology improvement plan.

Finally, the recommended 2027 property tax levy is approximately $606 million, an 11.3% increase.

I will return later in this presentation to how the City moved from the 5.4% increase assumed in the previous five-year plan to the recommendation before you today.

Before turning to the budget itself, I want to briefly highlight how the City published its budget book this year.

The City transitioned this year from its budgeting software to ClearGov, improving personnel budgeting and forecasting, and providing a new interactive budget book format online.

In addition to the standard PDF available through LIMS, the interactive web-based budget book is designed to make the budget easier to navigate.

We also expanded capital and technology project information and launched a transparency site that connects the adopted budget information with actual spending data from the city.

Links to all three of these resources are available in the LIMS file on this slide at the bottom.

One additional note I want to provide to the Council up front is on staffing detail.

Because the recommendation includes significant personnel divestments, the budget book does not present those reductions as final position title decisions.

The next step in the process is for personnel budget reductions to be reviewed and business-related decisions to be made about specifically how to accomplish those divestments.

on which specific position reductions will occur to ensure that departments manage within their new adopted budget.

For that reason, the roughly 100 FT divestment figure used in this briefing should be understood as an estimate and not a final list of positions.

The 2027-2028 budget book is organized so that readers can move from context and strategy to department level detail and then to the underlying financial schedules.

The opening sections explain the budget process, the city's fiscal and economic context, the budget strategy, major highlights, and city-wide spending and revenues.

The department section then provides expenditure, revenue, staffing, division, and budget changes by department.

The capital and technology improvement sections provide project-level information, funding sources, and multi-year plans for those spend types.

and the financial schedules in the back of the book provide the authoritative details on cash balances, revenues and expenses, staffing, transfers and fees.

For today's briefing, I'll rely heavily on the budget summary and highlights section.

That section was designed to explain the economic conditions facing Minneapolis, the choices made to balance the budget, and the mayor's recommended investments that advance city priorities and the results of trade-offs that residents should understand.

With that orientation, I will now turn to the recommended budget that was developed and major financial conditions that shaped the mayor's decisions in that budget.

Budget development began in January of this year, well before the mayor's recommended budget was published.

The first phase of our budget development process is establishing the current service level, or CSL.

The purpose of CSL is to establish the cost of continuing existing services before making decisions about new investments or reductions.

from January through March, the budget division reconciled budgeted position data, updated internal service fund costs, refreshed enterprise-wide forecasts, and launched our capital process.

In April and May, departments reviewed their CSL inputs, submitted proposed budget changes, and the Capital Long Range Improvement Committee continued its review and public engagement.

By June, we had a finalized CSL forecast and briefed both this committee, the Budget Committee, and the BET on the city's baseline financial position.

July focused on technology and capital recommendations and kicked off mayor's office decision making.

In August, those decisions were finalized and incorporated into the final published mayor's recommended budget on August 12th.

Across this entire timeline, the budget division has also been in the process of implementing our new ClearGov budgeting software.

With publication of the mayor's adopted budget, excuse me, the mayor's recommended budget, the budget division shifts its role from supporting executive decision-making and formulation to supporting BET and council review of the budget.

We begin today with the citywide overview of the budget.

Department presentations then run through September and October while BET considers the maximum proposed levy and council begins developing potential amendments to the recommended budget.

November is focused on amendment development and internal review.

And in December, Council conducts markups, holds the truth and taxation hearing, and adopts the final 2027 budget.

So today's briefing is the beginning of the review phase.

The mayor's recommendation establishes the proposed financial plan.

BET and Council now have distinct roles in reviewing and acting upon his proposed plan.

With that in mind, before I begin going through the budget, I want to be clear about the level of detail I intend to cover today versus what will come later during department presentations.

Today's presentation is intended to cover the citywide story.

I will cover the conditions that existed before the mayor's budget development began, the principal financial risks, the decision framework used in the mayor's recommendation, and broad changes in investments and divestments, the levy, and where our process goes from here.

Department presentations are intended to go deeper.

Those presentations will explain specific investments and divestment changes to the extent known at the time, anticipated service and operational impacts, the justification for proposed investments, and special topic or contract details where they are material to the department presentations.

That division of labor between the two presentations is intentional.

Today I want the City Council to leave with a common understanding of the city's overall fiscal position.

Department presentations will then allow you to test how that strategy transforms into operational choices at the service delivery level.

Minneapolis enters this budget cycle with meaningful strengths, a strong and productive economy, disciplined financial policies, long-term planning, and major investments in public safety reform, housing, climate action, infrastructure, and modernization.

Those strengths are all part of why the city continues to hold its AAA bond rating from all three major agencies.

But several fiscal trends are also moving in the opposite direction.

The cost of maintaining services is growing faster than recurring revenues.

Property taxes are carrying more of the funding burden for the city.

Commercial property values remain under pressure, shifting tax capacity toward residential and apartment property.

Labor and benefit costs remain the largest recurring cost drivers, while the stability of federal funding remains uncertain and local government aid has stayed relatively flat.

In August, S&P reaffirmed the city's AAA bond rating, but revised the city's outlook to negative.

The message is that the city's underlying strengths remain substantial, but unresolved structural imbalances, reserve erosion, and other factors now pose a material financial risk.

This chart illustrates one of the most important structural trends in the proposed budget.

Since 2018, property tax revenue has grown or is projected to grow by 7.7% per year on average.

Over that same period, intergovernmental revenues have grown by only about 9 tenths of 1% annually, and other non-levy revenues such as fines, fees, and permanent revenue have grown by roughly 2.4% annually.

That divergence matters.

When the cost of services grows faster than grants, aid, fees, and other flexible revenues, the property tax becomes the only revenue source available that must increase to close that gap and balance the city's budget.

Our out-year assumptions continue to show that pattern continuing.

Revenue growth is forecast to remain modest, with the levy doing substantially more work than most other revenue sources.

That is why expenditure control remains central to the city's financial and fiscal strategy.

A structurally balanced budget cannot rely indefinitely on levy growth that materially outpaces household income, inflation, or the local economy.

This slide shows the second major property tax dynamic, not only how much the levy grows, but how that burden is distributed.

As commercial and industrial values weaken relative to other property classes, their share of the net tax capacity declines while residential and apartment shares rise.

That means the same city levy can produce different impacts across taxpayers depending on how individual property values move relative to the rest of the tax base.

In other words, levy growth and tax capacity shifts can compound each other year over year.

This is why the percentage change in the city levy should not be treated as the same thing as the percentage increase on an individual property tax bill.

The actual impact depends on relative valuation changes and on levies from other entities such as the county, schools, and other jurisdictions.

I want to spend a moment on a somewhat special topic in this briefing, the city's bond rating, because it can sound abstract, but it does have a real practical effect on the cost of the city's government.

The simplest analogy I'll use on this slide is a personal credit score.

Stronger credit generally allows the individual borrower to access financing on better terms and at lower rates.

Minneapolis currently holds a AAA bond rating from all three major rating agencies.

That strong credit rating helps the city borrow at favorable rates for capital projects such as streets, bridges, and parks.

A negative outlook is not a downgrade.

but it does not automatically change our borrowing rate.

But it is a warning that the risk of a downgrade has increased.

The City's credit rating, if it were to ultimately be weakened, even a modest rate change could become meaningful across large, long-term bond issuances.

The bottom line here is that protecting our rating ensures financial flexibility and keeps more resources available for capital priorities rather than debt service.

This slide on that same theme puts an illustrative scale around that point using a hypothetical $100 million, 20 year bond.

using notional market spreads, the cumulative additional interest is about 4 million in a AA scenario and about 10 million more in a single A scenario compared to the city's AAA baseline shown here.

These are not forecasts specific to Minneapolis.

Actual pricing depends on market conditions and the specific bond issuance.

But the takeaway here in this illustrative example is simply that small differences in borrowing rates can compound over time.

That is one reason why

Reserve strength, structural balance, and credible long-term financial planning matters, even when the immediate operating budget is about a single fiscal year.

That brings us to our central challenge this budget cycle and the recommended budget.

The city entered 2027 budget development with a more than $60 million estimated general fund pressure made up of two distinct problems.

First, the current service level, or CSL, forecast showed a $28 to $33 million gap.

General fund expenses were projected to grow at 5.1%, while revenues grew only 1.9%.

Second, several department-based budgets did not reflect known recurring operating costs, the largest examples being police and fire overtime and settlement agreement compliance costs.

Together, those imbalances added another $27 million of risk to the budget this year, excuse me, to the proposed budget for 2027.

If the city simply carried those costs forward without any reductions or other changes, the implied levy requirement for the $60 million gap would have exceeded 17%.

The mayor's budget strategy sought to narrow that gap while addressing, rather than deferring, the underlying problem.

Taking a closer look at the first problem, the CSL gap, the June forecast that we briefed the Budget Committee showed approximately $712 million of general fund revenue against a $744 million expense, producing a gap in the range of $28 to $33 million.

CSL is not a proposal for new programs.

It is the updated cost of continuing the services already in the budget using current exceptions for salaries, step increases, COLA costs, health care and fringe increases, IT, fleet, utilities, rent, and other internal services.

The important point here is that these drivers are recurring.

Personnel costs increased by more than $30 million and internal services costs by roughly $9 million.

Without either recurring revenue growth or recurring cost changes, that gap compounds into future years.

Taking now a closer look at the second major challenge, the gap between adopted department budgets and actual recurring operating costs.

I'm going to keep this discussion focused on the financial facts and implications.

Police overtime is the clearest example.

A roughly $2.3 million base budget has been well below recent actual costs and the 2026 forecast.

Fire has faced a similar, though smaller, mismatch of a roughly $1 million overtime budget against several million dollars of annual cost.

Settlement Agreement compliance has created another recurring funding requirement that historically did not have a dedicated direct appropriation in the operating base.

The broader point here is that under-budgeting a recurring cost does not make that cost disappear or decrease.

Operational changes that either reduce cost or fully budget for the anticipated cost or a combination of those two is the only responsible path forward.

When department underspending or vacancy savings are not enough to absorb a budget overage, the difference pressures and degrades the general fund balance.

The mayor's recommendation therefore treats rightsizing these known obligations as a financial stability action, not simply as new spending.

Under these circumstances, the only responsible choices are to fund the difference or change operations or service delivery to reduce costs.

Continuing to allow cost overruns to deplete our general fund balance will further compound the financial challenge the city is currently facing.

This is arguably the most important slide in today's briefing because it shows the consequence of those pressures and others on our general fund balance.

City financial policy requires an unrestricted, unobligated general fund balance equal to 17% of eligible expenses.

That reserve functions as working capital and a financial buffer against revenue volatility, emergencies, legal risk, and other unplanned costs.

In simplest terms, this balance serves as the city's emergency savings account that gives the city government a roughly two-month cushion of operating expenses for emergencies and provides security to bondholders that were able to pay our debt obligations.

The current forecast shows the city ending 2026 materially below the policy target for the first time in over a decade, projected to be at 13% by the end of 2026.

This decline reflects repeated operating deficits and other unplanned pressures rather than a sustainable strategy for funding ongoing services.

That is why the recommended budget does not use fund balance as the solution to close the 2027 gap.

Using one-time reserves for recurring costs would deepen the structural imbalance and further weaken the City's financial position.

The mayor's proposed approach to narrowing the gap can be summarized in three main ideas on this slide.

First, right-sized budgets where the operational need is compelling, the city has a legal obligation, or the existing budget is out of balance.

Second, reduced costs through department-by-department staffing and contract reductions, consolidation, or service redesign rather than implementing across-the-board single percent cuts.

Third, restore structural balance by matching recurring costs with recurring revenues and protecting city reserves.

The mayor's review examined programs, staffing, vacancies, contracts, management structures, benchmarking results, which I believe we'll be briefing today, shared services, and opportunities to redesign delivery.

The objective was to create recurring savings while preserving core services and making room to fund obligations the city is already incurring, such as unbudgeted overtime.

This slide shows the financial result of that review.

The recommended budget includes approximately $23.7 million of divestments and cost savings and about $33.5 million of investments for a net general fund change of roughly $9.8 million.

The largest investments are concentrated in rightsizing police, fire regulatory services, and settlement agreement costs.

The savings come from personnel budget reductions, contract budget reductions, consolidations, and an operational shift within neighborhood safety.

The key point is that the two sides were considered together and holistically.

The budget redirects capacity from lower priority or reducible activity toward known obligations and areas of demonstrated need.

That is why the recommendation can reduce roughly 100 FTEs in some areas while adding targeted staffing and others.

So despite those actions and the proposed recommended budget, Standard & Poor recently affirmed Minneapolis at a AAA rating, but revised our outlook from stable to negative.

S&P's concern centers on the material weakening of reserves in 2026,

and an uncertainty about whether the final 2027 budget will restore structural balance.

Its earlier downside scenario in 2025 specifically identified faster than plan reserve drawdown as a risk because it leaves less room to absorb future pressure.

This is a useful external context for the budget discussion.

S&P continues to recognize strengths, but the concern remains on the operating side.

Repeated deficits, reserve erosion, and whether recurring expenditures are supported by sustainable recurring revenues.

S&P's assessment

is balanced.

The agency continues to cite the city's strong economy, robust tax base, and manageable debt burden as core strengths supporting the continuation of our AAA rating.

At the same time, it points to recent operating deficits, reserve erosion, slow tax-based growth, downtown weakness, and reliance on elevated downtown asset funds transfers as a risk.

It also notes that the recommended budget relies on an 11.3% levy increase and remains subject to Council and BET action.

The takeaway is that the City has an opportunity to correct course, but not unlimited time.

The recommended budget is intended as the first step in a multi-year effort to restore structural balance and rebuild reserves.

Now, with all that context established, I will now move on to the major revenue and expenditure components of the recommended budget.

A lot of this will be a repeat from what's already in the published budget book.

starting with revenues.

Across all city funds, including independent boards and transfers, excuse me, excluding independent boards and transfers, the city forecasts approximately $2.16 billion in 2027 revenue, an increase of about 142 million or 7%.

The largest category changes are taxes, up about 56 million, driven primarily by property taxes,

Changes for sales and services also drove the increase up about $48 million, largely in enterprise and internal service funds.

The general fund also grows by about 7%, or $45 million.

But excluding property tax growth, other general fund revenues are forecast to decline by roughly $7 million.

The 2027 downtown assets to general fund transfer is proposed in the budget at $47.5 million,

And the bottom line here is that the revenue story is not broad-based acceleration.

The levy is doing most of the work to support general fund growth, which is why conservative forecasting and expenditure control remain central to the recommended budget plan.

Local option sales taxes are an important revenue source for the city and a useful indicator of downtown and visitor activity.

Current trends suggest that the post-pandemic recovery phase has largely leveled into a period of relative stability.

Collections in 2025 were essentially flat.

Compared to 2024, the forecast assumes about 3% growth in 2027 and roughly 2% growth annually thereafter.

That is positive and useful revenue, but not growing fast enough to substitute for property tax growth and supporting recurring costs of core city services.

we therefore continue to monitor these revenues closely with development finance and downtown assets and use relatively modest assumptions in the financial plan.

Local government aid, or LGA, is another major flexible revenue source for the city.

The 2027 certification is approximately $82 million in total, and after ordinance required allocations to Park Board and NBC, the city's share is approximately $72.1 million.

LGA can support any lawful expenditure and is intended in part to reduce pressure on local property taxes.

The challenge here is that it's been essentially flat while the city operating costs have continued to rise.

The total certification is only modestly above 2020 levels.

That means wage growth, healthcare growth, internal service growth, and other recurring pressures not matched by LGA or other flexible revenues must ultimately be addressed through the levy or expenditure reductions.

The 2026 revenue picture, the controller outlined in their Q2 update, adds another layer of caution to our revenue forecasts.

As of the second quarter, as the controller briefed roughly two weeks ago, major general fund revenues were projected to underperform the adopted budget by nearly $15 million.

The largest pressure shown here is property tax collections, but several other categories also remain below budget.

A single mid-year projection should not be treated as the final year-end result.

and some collections are timing sensitive.

However, this direction matters because the city is already drawing down reserves due to expenditure overruns.

If revenues also finish below budget, the pressure on fund balance becomes even more severe at the end of this fiscal year.

This is another reason the recommended budget avoids using reserves as an operating solution.

Continued underperformance in 26 and 27 could further degrade the City's financial position and increase the risks identified by S&P.

Turning now to spending, the mayor's recommended budget includes approximately $2.15 billion in 27 expenditures when independent boards and transfers are excluded.

This represents a 107 or 5% overall increase.

The all funds budget includes very different types of activity across general fund services, enterprise operations such as utilities, capital programs, internal services, special revenue programs, and debt-related activity.

Looking across the multi-year trend on this slide, total city spending has increased, but the drivers differ significantly by fund and by year.

This slide shows the all funds budget by expense category.

The most important caution here is that the all funds view mixes recurring operations and capital project activity, so large year-to-year swings in contractual services and operating costs should not be read as equivalent to ongoing general fund growth.

Personnel remains a major recurring driver.

Salaries and wages and fringe increased by roughly $54 million or 8% from the comparable 26 budget.

That reflects compensation, step increases, health and fringe costs, and changes in funded staffing.

As was shared in the CSL presentation in June, one substantial cost driver for the city from 26 to 27 that changed significantly is healthcare costs, growing by a significant amount and being driven primarily by the rising cost of medical care.

One potentially misleading appearance of growth on this slide that's also in the published budget that I want to demystify for Council is the contractual services row, which changes $350 million from 26 to 27.

This is due to a change in how we categorize the capital expense budget between the two years.

In this case, accounting categorization shifted from the capital equipment category on this chart to the contractual services row with a net increase of only $3.9 million between those two rows.

Although contractual services and operating costs increase materially in the all funds view, these categories are heavily influenced by capital, enterprise, and project spending.

I will therefore focus the next two slides on the general fund, where the recurring operating picture is much clearer.

In the general funds specifically, the budget total is approximately $738 million in 2027 when independent boards and transfers are excluded.

The $738 million operating view is 7% or $49 million higher than the comparable 26 adopted budget.

The General Fund supports core governmental services, police, fire, public works activities.

Those are partially funded through the General Fund.

Administrative and regulatory functions, among others, that do not have a dedicated enterprise or restricted revenue source are reliant on the General Fund for operations.

Because general fund revenues are the most flexible and the property tax is the largest flexible revenue source for the city, this is where structural imbalance becomes the most visible in the budget.

The expense growth shown here must ultimately be matched by either levy growth, other recurring revenues, or recurring reductions.

The General Fund expense category review makes the recurring cost drivers much clearer.

Salaries and wages total $369 million and fringe benefits $145 million.

Together, salaries, wages, and fringe benefits increase by $42 million, or 9%, from 2026.

That growth reflects negotiated compensation and COLA changes, step regression, health insurance and fringe cost increases, and funded staffing changes.

Internal service charges are another major driver at 106 million, roughly 9 million, or 10% above 2026 levels.

Contractual services here are significant, but they are not the primary source of general fund growth.

That matters when considering a lower levy alternative.

There is not a single discretionary contract bucket large enough to close the structural gap.

Material recurring reductions eventually require choices about staffing, service levels, or other major ongoing obligations across the city.

The recommended budget decreases the city's funded personnel count, or FTEs, by approximately seven total to 4,285 funded FTEs in the 2027 recommended budget.

This small net change masks substantial movement underneath.

The mayor's review identified an estimated 100 FTE divestment across departments, but those reductions are being offset here by targeted staffing investments.

The largest additional investments here include 40 police community service officers and cadets, 23 community safety ambassadors, 15 firefighters, and several smaller adjustments.

This is a useful example of this year's budget strategy and practice.

The City was not simply adding positions or cutting positions, it is reducing capacity in several areas while redirecting that capacity toward public safety and fully budgeting for police recruiting, legal obligations, and operational areas where staffing can reduce other cost drivers or address clear service needs.

So we'll be going into a little bit more detail than I think we have in prior years for these slides.

So the largest general fund investments are primarily budget rate sizing actions rather than conventional program expansions.

The recommendation adds $13.1 million for police overtime, $3.4 million to fire overtime, moving both budgets closer to actual recent cost patterns.

It also funds 40 police CSO and cadet positions to right-size police recruiting, adds $3.1 million of funding for police contractual services, funds fire operating costs, adds 15 floating firefighters, and right-sizes regulatory services overtime and on-call costs.

Together these investments total $25.4 million.

The rationale here from the administration is that when the city has recurring operational needs that it's already incurring, systematically under budgeting does not create a real savings.

It creates an operating deficit.

Departments will address the operational rationale and service impacts in greater detail during their presentations.

The next set of investments in the proposed budget are what we'll term operational redesign.

The recommended budget funds 23 community safety ambassadors or CSAs with a neighborhood safety at approximately $2.3 million.

The ambassadors provide an unarmed non-law enforcement presence and a range of neighborhood safety services beyond the pilot phase.

This investment is fully offset by a reduction in violence interrupter contracts.

In other words, this is not simply additional spending, it represents a shift in how some community safety capacity is delivered with the CSA approach resulting in a net cost decrease for the city.

This budget also provides $160,000 to continue the 9-1-1 embedded social worker program with Hennepin County beyond the pilot phase.

Together these investments total $2.4 million and are intended to move resources toward service models the administration believes can deliver more consistent or sustainable outcomes with greater city control and oversight of activities and spending.

Final slide on investments.

This slide summarizes several smaller but important investments.

Approximately $4.1 million here is dedicated to settlement agreement contracts and the independent evaluator with finance and property services serving as the proposed financial steward of that contract funding to improve alignment between spending and compliance requirements.

Other smaller investments here include additional FTEs to support the city's expanded facilities footprint, election and voter services funding to prepare for the 2028 election, and fee and content accessibility requirements.

These investments reflect the first pillar of the administration's budget strategy, prioritizing legal obligations, known operating requirements, and needs where underfunding creates either compliance risk or a predictable future cost.

The other side of the administration strategy is roughly $23.7 million of divestments and cost savings with an estimated impact of roughly 100 FTEs.

The largest actions here include consolidating communications and NCR, reorganizing PMI and REIB functions, reducing violence interrupter contracts as part of the shift toward community safety ambassadors, reducing health and other contracts, and making personnel budget reductions across police and other departments.

The mayor's review looked across staffing, vacancies, management structure, contracts, shared services, benchmarking, and program consolidation.

Roughly $9 million of the proposed savings here comes from contracts, which reduces the amount that must come from personnel budget reductions.

This implementation point is important.

The 100-FT figure here is an estimate used to balance the recommended budget, not a final position-by-position elimination list.

The next step for departments will be a deliberative process to review service impacts, business needs, and HR processes before it is determined which and how many specific FTEs will be eliminated in order to ensure departments manage staffing and costs within their new personnel budgets.

This table displays the combined investment and divestment impact on the, excuse me, impact on OPS or Office of Public Service departments.

The important pattern here is that their budget review was broad, not every major service and support function, excuse me, every major service and support function was evaluated for opportunities to reduce cost, align staffing with workload, or consolidate activity.

Some departments show net reductions here because the recommendation removes positions, contracts, or lower priority activity.

Others may show increases despite reductions because CSL cost drivers or targeted investments outweigh the identified reductions.

For example, the Finance and Property Services Department, excuse me, FPS despite having a divestment, has a net increase here driven primarily by the settlement agreement investments housed in this department.

I don't intend to walk through every line of this table today.

Department presentations will cover that level of detail.

The city-wide takeaway here, though, is that the mayor's budget did not rely on a single large cut.

It assembled savings from across the enterprise so that reductions could be considered on a department-by-department basis rather than implementing a single percentage across-the-board reduction.

The intent here was to preserve core city services wherever possible.

The same is true across community safety and other departments.

OCS contains both some of the largest investments and some of the largest divestments in the proposed budget.

That is partly because the recommendation is attempting to address two problems at once, reduce lower priority or duplicative costs while putting recurring resources behind the actual cost of public safety operations and legal obligations.

Again, the department presentations will be the appropriate place to examine the service implications of changes at the citywide level

These tables demonstrate the redistribution of general fund capacity that underpins the recommended budget.

The Capital Improvement Plan, or CIP, is the City's six-year framework for major investments in infrastructure, facilities, parks, public spaces, and other long-lived assets.

It is updated annually.

and only the first year is formally appropriated.

The recommended six-year program totals approximately $1.76 billion, including $359 million in 2027.

Uses include bridges and streets, water and sewer infrastructure, parks, pedestrian safety and city facilities.

The principal funding sources here are debt, enterprise revenue, intergovernmental funding, special assessments, transfers, and other dedicated capital resources.

The six-year view matters because it allows the City to sequence projects while managing debt service, affordability, and future levy impacts.

The Technology Improvement Plan, or TIP, applies a similar six-year planning framework to major technology investments.

It includes enterprise software, system modernization, cybersecurity, and major platform replacements, primarily supported by the permanent improvement levy.

The six-year recommendation, six-year recommended program totals approximately $65.4 million, including $11.85 million in 2027.

The 2027-28 plan includes six major projects, among them 311 leg and replacement, enterprise resource platform, data modernization, firewall refresh, learning greenway technology work, and the police records management system.

The objective here is to make large technology needs visible, sequence them across years, and prioritize those technology projects to improve service delivery, resilience, enterprise operations, and compliance.

I will now turn directly to the property tax levy, how we arrived at the 11.3% recommendation, what it supports, and what lower levy alternatives would require.

This slide summarizes the city's levy journey and the recommended budget.

The five-year plan adopted with the 2026 budget assumed a 5.4% increase for 2027.

Updating the cost of existing services through the CSL raised the implied levy requirement to about 11.5%.

Recognizing known department budget imbalances and settlement agreement costs pushed the implied requirement to 17% or above.

The mayor's review then identified recurring divestments, efficiencies, consolidations, and service changes that reduced the final recommendation to the 11.3% that's recommended today.

A lower one-year levy could be produced by leaving known costs unfunded or using one-time resources, but that would not remove the underlying obligation.

It would increase the likelihood of a larger correction or more significant service reduction in 2028.

The recommendation instead attempts to recognize known costs now while offsetting them with recurring savings into the future.

The five-year financial direction shows why the city should view 2027 as the beginning of a multi-year correction rather than an isolated budget year.

The prior plan was built on assumptions that predated the most recent cost growth and reserve deterioration.

The updated plan incorporates the recommended 27 actions and shows the likely implication of current wage assumptions, benefit cost increases, debt schedules, revenue forecasts, and other known obligations.

The five-year financial direction is not a commitment to a specific future levy or appropriation.

It is a decision support tool.

Its purpose is to make future consequences visible when decisions are made today.

Under the updated plan, levy growth moderates after the 2027 adjustment, but continued discipline and reviews of reduction options will still be required.

The budget book is explicit that efforts to identify cost savings, targeted divestments, and reforms must continue ahead of the 2028 budget being finalized in order to achieve the levy figure proposed here.

The likelihood of continued inflationary impact on the city is also expected to increase into 2028 and beyond.

For the benefit of the public, this slide translates the levy into a more intuitive question.

What does a taxpayer's city tax dollar support?

Of every $1,000 in property taxes, the largest share supports general fund government services and police.

Significant shares also support MPRB, capital and debt service, fire, pensions, public works, and the MPHA levy.

The exact allocation here is useful because the city levy is not driven by the general fund alone.

It includes debt service, capital obligations, pensions, independent boards, and other entities.

That is why a discussion of the levy must also include those entities as well as operating services and longer term obligations.

It also illustrates the practical constraint of a large levy reduction.

Material reduction must ultimately come for one or more of these service and obligation categories.

To make the levy trade off a little bit more concrete,

one levy point equals approximately $5.45 million.

Moving from 11.3% to 11% requires a $1.6 million decrease and recurring saving.

10.5% requires 4.4 million and the requirement grows quickly from there.

The FTE figures here are illustrative equivalents using a 134,000 average cost for an FTE.

This is not a staffing proposal.

The purpose of this slide is to show the scale of recurring reductions that would be required after the recommendation has already included substantial contract and personnel reductions.

At the lower scenarios, the gap becomes too large to close through small administrative efficiencies alone.

A sustainable lower levy would require identified recurring offsets and staffing, contracts, service levels, or other ongoing obligations.

For Council, this session was not briefed at BET last night and this is new for this body.

I will close with the framework the budget division will use to support the next phase of review, department presentations, amendment development, and adoption.

As we enter the amendment phase, I want to be clear about how the budget division will support council.

We will operate around four key principles, confidentiality, impartiality, transparency, and responsiveness.

Within applicable legal requirements, amendment concepts and analytic requests from all council members will remain with the requesting office unless we are authorized to share them.

Our analysis will be non-partisan and focused on fiscal, operational, and financial policy implications rather than political outcomes.

We will make assumptions, funding sources, implementation risks, and data limitations clear.

And we will use consistent methods across all offices.

We will also communicate expected turnaround times and flag requests that may require additional analysis or coordination.

The goal here is to give every council office a reliable technical partner in the amendment process while preserving the distinct decision-making roles of elected officials and departments.

We are also committed to supporting public understanding of the budget.

Budget Division staff and myself are available to support committee engagement sessions and special events, and we can provide a concise overview of the recommended budget and budget process to your constituents.

The ClearCov Transparency tools are intended to make current year expenses, revenues, and other financial information easier for residents to access.

Those tools will continue to be updated as additional spending data becomes available on a quarterly basis.

Our goal is to ensure that the formal council review process and public-facing information tells the same financial story.

Residents should be able to understand not only what the city proposes to spend, but also why the budget is changing and where actual spending is occurring.

I'm actually going to skip over this slide because the schedule is inspected to change considerably, and Chair Chugtai covered the updated schedule briefly at the beginning of this presentation.

Moving on to expectations.

For department presentations, the budget division and department heads have complementary roles.

The budget division will provide the citywide financial context

explain revenue and cost changes, identify how the recommended budget changes the CSL baseline, and support council with analysis throughout review and markup.

Department heads are best positioned to explain department-specific costs, operational conditions, service impacts, and the practical implications of investments and divestments.

Not all of those impacts may be known at the time of department presentations.

The budget division respects department heads' authority over operations and implementation.

Our role is to explain the financial plan and provide decision support.

Department leadership remains responsible for service delivery, program planning, and implementation within adopted budget and applicable city policies.

I want to close here where I begin, the city's long-term financial position.

S&P's negative outlook means the agency sees a one in three chance of a downgrade during the one-year outlook period.

If the downside case from S&P is straightforward, failure to adopt and implement a structurally balanced 2027 budget, continued reserve drawdowns, or the absence of a credible path to restore reserves could lead to a downgrade.

The upside case is equally clear.

Sufficient structural measures and realistic assumptions that are sustained beyond 2027 could return the outlook to stable.

The mayor's recommendation is intended to move the city toward that upside case.

It does not solve every multi-year challenge in a single year, but it recognizes known costs, avoids deliberate use of operating reserves, makes targeted reductions, and begins aligning recurring expenditures with sufficient budgeting.

As the budget changes to review and markup, the central financial test will be whether changes are sustainable and whether they strengthen or weaken the City's ability to deliver services today and into the future.

This concludes the initial presentation.

The budget division and I are happy to answer questions.

Or, if the chair permits it, return to a specific slide for closer examination during Q&A.

I'm hopeful that the charts in today's presentation can help as visual aids during Q&A, as we've covered a lot of material.

And for members of the public, the full mayor's recommended budget, financial schedules, department details, and transparency tools are available online through the city's published budget materials.

Thank you for that presentation, Director.

Colleagues, I am looking at my speaker management to see if there are any questions or discussion related to Director Green's presentation.

I see a few members getting in queue.

Thank you, Chair Chuktai and Budget Director Green.

I want to start off by saying that years of police misconduct, legal settlements, and lack of police reform in our city are a real driver of why the budget pressure our residents are facing today and are asked to observe these cuts through levy increases and core city services is a big factor in it.

And I think it's important to acknowledge that police misconduct and the millions of dollars that we have used in

City Resources is why we are in a position we are in today.

It also seems like the department who created that misconduct isn't the one facing that burden.

It's now being paid through cuts to housing inspections, community programs, violence prevention, violence interrupters, public health, climate, and basic city services that had nothing to do with the police misconduct that led to a federal consent decree that we needed to have but don't have.

and a settlement agreement with the MDHR.

So we are cutting city services that residents depend on on a daily basis to cover the liabilities for the Minneapolis Police Department that they themselves generated by years of police misconduct in our city.

And I just wanted to mention that because now we're having discussions about laying hundreds of staff from the city of Minneapolis because of money we don't have.

So I wanted to at least start off this budget conversation today with the real conversation of why we are in this place to begin with.

And if we would have had real police reform, struggle changes in the police department, and accountability, we wouldn't be here today.

So one of the first questions that I have though is if we can get a rationale of why NCR and the Communications Department, there's a slide on here, they're being proposed to be merged.

Through the Chair, Councilmember, so the budget division was involved in providing financial analysis and information to help inform that decision, but I would defer additional information on the decision to merge those two departments specifically to both the administration and the upcoming O.P.S.

Do we know where the nine staff positions are coming from?

There's nine staff positions being cut.

Is it coming from NCR?

Is it coming from communications?

And the other question I have is did the mayor's administration have a conversation with NCR incomes?

Through the chair, council member.

So the next step in the personnel reduction process is for personnel budget reductions to be reviewed and business need related decisions made about specifically how to accomplish those divestments.

So the specific position reductions will occur in a manner that ensures that departments manage within their adopted budget, but also in accordance with city and HR policies.

So at this point, I can't speak to any specific position level reductions.

In the upcoming department presentations,

If decisions have been made by the point of presentation, it is possible they'll be able to speak to broad service level impacts and on the point on whether or not those organizations were consulted.

Unfortunately, budget division doesn't have insight into those conversations.

I would like to understand that a lot more better.

If you go through the budget book, which I think needs to be a lot more transparent than it is today, there are specific cuts to different departments.

NCR incomes being combined is resulting in a ton of layoffs.

I'm assuming there's an estimate or if they're saying there's specific positions being cut, I don't know how we don't have access to that or what departments are thinking they want to cut.

or what they're proposing to cut.

Through the chair, council member, the way that we do budgeting at the city to create a balanced budget is we essentially roll in and forecast the amount that will be required to achieve the administration's intended reduction.

So in the example case of NCR Communications,

We are presenting an FTE forecasted number on what number of individuals or number of FTEs that are funded may be required for them to manage within budget.

Through the chair, council member,

It is certainly a possibility.

So in the case of a department, for example, if they have, I'll just use an example here, if they have a $100,000 reduction, and we estimated that in the budget book at 1 FTE, if they choose two employees that each cost $50,000 in terms of personnel costs, that number could go up.

Yeah, I think we need to figure this out a lot more because there is obviously a lot of staff morale across the city enterprise that is being decimated from the conversation of 100 employees, whether or not their vacant positions or not are being laid off.

A conversation we're hearing today that it might be more than 100 employees, maybe less.

We don't know.

There's proposals in front of us that tells us how many positions are being cut.

That may be the case.

That might not be the case.

There needs to be a lot more conversations about how this project is going to work out and what impact we're going to have.

If a department is going to present to the Budget Committee and they don't know which staff members are going to be cut or what positions are potentially being cut or what impact that's going to have, it's going to be very hard for us to make decisions up here.

If we're talking about, which I don't support, but if we're talking about combining communications, which is a whole different department, and neighborhood community relations department together,

and then not knowing which staff they're coming from and what impact that's going to have to our community, especially after a whole occupation that just happened in our city and the impact it's going to have into our immigrant community members, our people of color in our city.

That is just something that I want to get more details on and what impact it's going to have.

So I guess the other conversations I want to have here is that for every division or department showing a reduced FTE account,

It would be helpful to know what specific positions or titles are being eliminated, which ones are vacant or filled, and what are the actual impacts.

And I know that you can't communicate that with us today, but when staff are going to present those department budgets in the future, it would be helpful for us to know because our departments, not departments, our staff here in the City of Minneapolis and our constituents deserve to know what is happening and what impact they're going to have in their daily lives.

It would also be helpful to know what specific outcomes and metrics were determined to make particular changes in this budget, especially if we're seeing cuts to a lot of our city staff, cuts to city programs, but MPD getting what they need.

and then it will be helpful to get more robust conversations about this entire budget.

Thank you.

We have a few more members in queue so next I will recognize Councilmember Wonsley followed by Councilmember Palmisano.

I also have a couple of questions.

Councilmember Chavez actually raised some of it, but related to slide five, but your overview of the new budget system.

You mentioned, you know, this is fostering greater transparency.

It's more user-friendly.

Now, I have a few gripes with it that does not actually align with what you've mentioned.

One of which, there is not the line-by-line expenditure that we did have in the previous system.

And I think there's been a continuous discussion amongst his body in the public, especially as we're trying to leverage our oversight arm.

That has been such a critical piece for us to do our jobs effectively.

We saw that even play out last year or last budget cycle when we caught a glitch in finance accounting in terms of the chief's detail that was originally reported to be in the millions.

And all of us didn't even know that there was a paid expenditure for a chief's detail, so basically a chauffeur to drive the chief around.

That was being part of their general budget.

And then when we inquired and did staff memos and LDs about it, then we were informed that, oh, that was a glitch.

It's actually around $400,000.

But had we not had that line by line accounting, we would not have known that.

And that is not present in this current budget book system.

So that really doesn't allow us to do our jobs effectively.

I would love to find a way in which we can have a system that goes back and incorporates that piece so that we can be more due diligent in how things are being expended, again, bit by bit.

Another thing that Councilmember Chavez raised too that I think

brings a lot of confusion with this budget book is you all are also incorporating government structure ordinance changes into this process as well.

So you mentioned Communications NCR as basically combining that.

That would require a government structure ordinance change.

And I think there's an asterisk that it says this on the budget book.

But you all proposing that and then including a budget makes it seem like it's definitive when we have not even gone through the legislative process for that.

and I think that does create a sense of confusion because as of now, those are two separate departments until we make any legislative changes and their budget should be communicated essentially respectfully and accordingly under our current structure.

So I don't know who made that decision as well.

Maybe that could have been a separate tab in itself, but it should have definitely not been presented as a combined department or merged department and having a merged budget when that is not

I think this is more so for the body's awareness.

I know Hennepin County recently dropped a statement that said that

Our county, which Minneapolis, we're the largest metropolitan city in the county, we generate about $2 billion for the state of Minnesota in revenue.

And the state itself gets about $500 million.

In your slide, you reported we get about $72 million of that.

So just noting, I know in prior legislative sessions, and I think this is something to raise when we have IGR come before us, and you highlight that, that LGA has been relatively stagnant.

This needs to be a legislative amendment or legislative proposal we need to absolutely go after.

I think it's important to have a conversation not just with the Minneapolis delegation, but there is so much discussion about like the metro versus the rural and it's like actually the metro is subsidizing bridges and schools and other public assets in rural places that maybe they might think Minneapolis is the scariest place to walk through unless it's a Taylor Swift concert or in a country of

at the Armory or something, but we are actually financing like the basic goods that help your cities and your towns function and we're not receiving even an equitable exchange for what we're generating out.

So I think that is something that I will be raising for IGR of how we can be more aggressive in pursuing LGA changes.

And I know that 72 million even was a slight increase from the last legislative session, but it's clear we need to go after a little bit more.

Also another piece too of like what you highlighted with the slide is we need to aggressively be pursuing alternative revenue sources.

And I know our legislative staff has done a really great job of outlining a few pathways for us to do that.

Again, that requires us to work hand in hand with our state legislators, but we have one in the process of pilot called, you know, payment in lieu of taxes.

that could bring some additional revenue into the city.

And we're trying to work with the administration to develop that.

We also could be looking at how to work with state partners for a real estate tax or a vacancy tax.

Again, aggressively pursuing revenue streams so we're not constantly having to see property taxes constantly go in that upward line that you proposed today.

And we can have new ways to offset that.

So I think that absolutely has to be one.

This came up in conversations at Biz, but it also makes no sense for the Mayor's administration to be leaving money on the table when it comes to our fees and the constant refusal to enact fees or adjust them in the way in which we could be maximizing within legal terms and conditions.

Getting a full recoup of the costs that we're paying for certain services.

or the provision of certain services.

And one case example is the refusal to enact off-duty fees, which we have the potential of recouping up to $2 million for side gigs that our police officers do in their spare time, but taxpayers are subsidizing through the provision of their cars, through the provision of their uniforms to go out and essentially do private side gigs and then they get private pay.

the fact that we're not charging on the use of city resources for that that the city's own estimate again we could get millions of dollars for it is just ridiculous to me of how relieving money on the table as also another way of doing revenue.

Another piece on slide 18 actually in regards to the the right sizing of the budget I know this also has been an ongoing conversation when it came to the MP or MDHR

settlement agreement, a number of us have constantly raised for the past like three years since this was enacted.

Was there a need for a dedicated funding source for this?

And we were told, I think by, you know, finance director at that time, the sensor and then finance overall that this was tied, I believe, to a percentage of our general fund.

So there was not a need to have a dedicated source for this.

But now this is actually a recommendation.

So I would love to know what

cause a shift in that.

I think we all foresaw that this required an actual targeted source.

I don't know if it's because we're broke now that this is why we're actually now saying we need to put this in a more structured way.

Yes, through the chair, council member, it's a very good question.

And my understanding of the settlement agreement history from a financial perspective is that the significant cost of those associated contracts and personnel didn't become incredibly clear to the city until roughly one year ago.

So as we went through time, we felt relatively comfortable assuming some level of risk and using fund balance to cover those contractual obligations over the past one to two years.

Now that we're looking at upwards of $4 million in contractual costs to maintain the independent evaluator as well as other peripheral contracts, we see that as a similar threat to over budget and overtime in terms of additional degradation of the city's fund balance and financial situation.

So as we look at that continuing,

and now have both the federal and the state consent decree that we're attempting to manage, we see it as critical to get that expense fully budgeted and appropriated rather than continue to degrade fund balance to cover those costs.

And the other thing I'll add to that is that the manner in which we're proposing appropriating additional funds or that the administration

is proposing additional funds to that is putting that funding in FPS or Finance and Property Services, which will be detailed that process when OCS and other parties brief the settlement agreement special topic in a few weeks.

But the intent there is for Finance and Property Services to serve as somewhat of the steward of those funds in conjunction with council to ensure that the contractual costs are truly aligned and very closely aligned to settlement agreement

Thank you for that clarity.

And actually, I would then, I'll, of course, save this question then for OCS.

But in terms of, I would love to know, again, this goes back actually to my first question.

Is it possible to get line by line?

Because I think this has also been the biggest piece because settlement agreement costs, at least what we were told too by finance was the reason why there wasn't any dedication, was because the cost is spread out

across the enterprise.

And I think this is a scenario where, again, it would be helpful to have line by line.

Because what we saw also in our independent evaluators' regular summaries is that they were making recommendations for FTEs, and then we were not doing it.

But we're still being asked to approve contracts in the millions of dollars, and then the RCA says it's for the settlement agreement.

So this is again where it's like line by line, it would be helpful to know what is actually being put under our settlement agreement that's actually being asked for by our independent evaluators that's actually represented in that agreement.

Through the Chair, Councilmember, the good news there, and this would be a bit of a peek behind the curtain at what is coming up in the department presentations.

We've been working very closely with the Budget Committee to make sure that the templates that the departments are provided to fill out for the upcoming department presentations provide visibility into that what you're calling line-by-line view.

Thank you for that Budget Chair, I'm assuming then those will be uploaded to LIMS also so that that can be a view by the public.

Okay, awesome.

Those are my last and I just want to name to just a fine point on Councilmember Chavez.

observation about what this budget is.

Of course, you know, we're constantly heard that on the fiscal aspect, this is what is needed, this proposal by Mayor Frey to balance the budget.

And I look to slide 45 where, you know, you name what this thousand dollars of taxes

what that pays for and I can't help but see through this visual component how imbalanced this budget is at its very basis.

The idea that we're dedicating $8 to preserving our public housing and public works, that's our bridges, that's streetlights, we're doing $70.

But most of that thousand dollars is split between government services and then the police.

And we know overwhelmingly this budget is tied to essentially filling a deficit created by significantly like one department.

So I just can't stress too of what Councilmember Chavez said, like taxpayers are literally continuing to pay for the continued mismanagement of our police department that's literally bankrupting and defunding the city of Minneapolis.

And I hope there is some level at some point in this budget that there is a political will amongst this body to really tackle this.

so that there isn't this inequity and imbalance that's going to be passed on for the next five years in the projections that you named because this has been the trend for the most recent five years.

It's no surprise that we're here right now.

So this is so alarming and so unsettling and yeah, I hope we're able to actually present a more equitable budget in this next couple of weeks as we do this work.

Thank you, Councilmember.

Thank you, Madam Chair.

First, I'm eager for us all to roll up our sleeves and get to work.

And I'm all for pursuing LGA changes, as we've been trying to pursue those for many years.

I don't think this is a question for Director Green, but in general, I've been asking around with department heads about impacts to specific positions, and in general, this goes to Councilmember Chavez's comments about what specific positions are being cut.

The simple answer that I am getting back is that at this time, we don't know what positions would be included in a consolidated department.

It sounds like

In my conversations, directors of departments are working to be very consultative, if that's the right word, and working at the best new form of what a consolidation would look like.

And that's just based on casual conversations with the NCR director herself.

So there will certainly be ordinance changes required to meet this year's budget.

if the levy remains the same or lower.

In fact, I'm opening up a couple of them with notice of intent so that we, our council, can work to make any changes necessary as we all go through this process together.

So I'll be giving a notice of intent, and it's not to make them just as the mayor's budget proposal, but rather

to end up getting finalized after we as a body are done with that process to then codify any of those changes, any of those consolidated departments.

So I just wanted to be really upfront with that and how I think we can try and make this difficult budget year work into the future.

So to that end, there are so many things in this report

But one that really sticks out to me is the precarious situation of our bond rating and I suspect Director Green you agree with me because you circled back and reiterated it at the end of your presentation Councilmember Palmesano, if I may ask you to move your mic closer Sure all the liquids here Is that better?

Okay

I think people are tired of hearing us talk about our bond rating, but our revised S&P outlook to negative is concerning to me.

And slide 15 about the impact of higher interest rates for bonding is frightening.

Bonding supports our infrastructure work, and it's not flashy, but we can't maintain our city without it.

We can't maintain our infrastructure without it.

And we can't afford to do it if we have to pay higher interest rates to do it.

What goes into determining our rating?

I know that our target cash reserve of 17%.

What else impacts our rating?

And then there is

I see you're on 15, then if to ask you about slide 19, what else do you recommend to combat slide 19 and the determination for the first time in over a decade Minneapolis is forecasted to end the year below our required fund balance.

We have to address that in this year's budget, I think, by cutting expenses or increasing revenue.

Yes, through the chair, council member.

So I'll just emphasize this is a hypothetical, you know, scenario where we're using a hypothetical current AAA rating and then showing what the impact could be, again in a hypothetical depending on market conditions and

You know, specific bond issuing cycles on what a rating and cost to the city could look like in a double A and a single A scenario, which, as you pointed out, would be significantly increased in some respect, especially when we spread it out across multiple bonds and a longer time horizon.

So the key elements that S&P looks at when it does its rating, just to paraphrase, would be reserve strength, which I think is the key one that we're hitting on here, and that is featured on multiple slides, structural balance and the budget, so covering anticipated costs with actual appropriated funds or sustainable revenue, and credible long-term financial planning, faith that the city has sufficient reserve strength

I think that what would be most helpful is, and maybe I think this probably needs a follow-up, I don't expect people to know this off the top of their head, how much does the proposed budget rely on transfers from the downtown asset fund?

Because that ultimately plays into this as well.

How much have we used over the past few years, and what is our current balance?

We've made some transfers from it this year for important things.

I understand we can't keep relying on that fund for our general operating expenses, but that seems to be, I mean it obviously is what we've relied on in the past to help cushion this type of blow.

Absolutely.

Through the chair, council member, we did come prepared to discuss downtown assets.

So the current figure in the proposed budget is a $47.5 million transfer compared to last year's recommended budget before council markup.

That was very similar at $47.4 million.

After additional adjustments, that rose to $56.8 million.

and when we compare that number to, you know, roughly what those numbers were during the COVID area when the city was very deliberate in dialing down that transfer to preserve fund balance and ensure that, um, you know, we weren't over transferring with the economic hardships we were facing.

It was in the roughly $11 million range during that era.

Yeah, I think that's helpful as we move forward and we try to look at how we all move forward in this whole budget.

I think it's an important aspect.

If I could ask just another comment about slide 37 and then I'll back out of queue to make space for others.

Take your time.

On slide 37, you outlined major divestments, and I had a constituent just yesterday express concern about the divestment and neighborhood safety of two FTEs.

I know that the final decision as to what two to cut would land with the director, but this is proposed to be an FTE loss in alignment with the reduction of violence interrupter contracts, I think.

Would something like that mean, and this might not be a question for you, it might be for the Neighborhood Safety Department, that we don't need as much staff to implement those contracts?

This shift of FTEs to community safety ambassadors is a pretty fundamental change.

Through the Chair, Councilmember, I would defer to the administration on the exact decision making that led to the two FTs that are in this chart, as you pointed out, included in that proposed reduction to the contracts.

And I believe that when Neighborhood Safety briefs this body and their department presentation,

Hopefully they'll be at the point in decision making where they'll be able to provide clarity on exactly either if not the two FTs that they're proposing, what are some of the key services that would be impacted in terms of the way that they're currently thinking about it from a business need perspective.

But what budget doesn't want to do is get ahead of department decision making.

I'll just emphasize as you did a minute ago.

that, you know, the departments in conjunction with HR and other parties are working through that decision making process very deliberately focused on business need and position alignment to, you know, business, excuse me, business need before even considering position alignment.

Yeah, I think this is an example of what I suggested before, so I just wanted to point it out.

Thank you.

Absolutely, thank you.

Yeah, thank you.

I had some follow-up questions too.

I did have questions around the Downtown Assets Fund as well.

Where is the best, I mean, so in the recommended, when I'm looking at the budget book under the 2027 recommended budget, that shows the planned transfer of $47.5 million included in that.

Or is that, where can I find that?

Because it shows it being increased and obviously there can be revenue increases in that and maybe I'm looking at a different one.

Okay great and it sounds like we're gonna get more general information around that and that's so there's no need for that well we'll get that information at that point.

I just don't think that those kinds of transfers are sustainable, and I understand when we're in this kind of fiscal environment, we have to look where we can.

But this is, again, I agree with everyone here that we cannot continue that continued transfers.

Can you speak a little bit more to why there is often this differential, and I think it's on your slide where it shows the long term.

Let me see where I had it, what slide it was.

where you show the year-by-year estimated increases versus actual.

Why is there such a differential when we know what anticipated employee increases are going to be, etc.

?

Can you speak to that?

Because there's quite a difference.

We forecast 5.4% I think as a levy increase for 27 and we're sitting at 14 something.

I think you know, yep, that's the slide.

Yes, through the chair, Vice Chair Schaffer.

So the five-year financial direction is a planning assumption.

So the way that we would have formulated the 2027 position around

You know, this time a year ago would have been before we had a full grasp on some of the inflationary factors, especially on the personnel budgeting side.

Okay.

So when we go through that CSL budgeting process, especially just putting a fine point on the past 12 months, those personnel factors, especially healthcare and some other things have grown considerably more.

than we were anticipating when the initial five-year plan was put together last year.

I will also point out that the 28 forecast was also revised up in the comparison, which reflects a more accurate forecasting of just inflation continuing, not quite at the hot pace it's at now, but still continuing into the future.

Thank you, that's really helpful.

And I just want to say in conclusion that I really appreciate this presentation.

I've already gotten comments from residents that have tuned in last night and watched this and said it was very clear.

Family friendly, as far as just someone that's not a finance background, to be able to tune in and really be able to articulate to friends and community members what it is that we are going through in this moment as a city.

And the first step is education.

and I see you as leading us in that area and I just wanna personally say thank you for the effort and the time that everyone has put in to get to this point and there's gonna be more dialogue, there's gonna need for more education but I really think you guys have set a high bar here for transparency and you have already committed to us again in the slides around confidentiality and I really think that is gonna set the foundation for a good budget process for us.

and I look forward to, I think we all agree that this levy increase is painful and we would love to see it come down, but it's also scary to see what that means.

I think on the bottom of your chart it was another 94 FTEs, but yet we have an opportunity here as a council

to really practice compromise.

We have an opportunity to really take this data that we have a strong foundation of and to work together to try to lower this levy in a way that shows the community, that shows the city of Minneapolis that we are a board that can work together in emergency times, that we are a board that can work together in fiscal responsibility with the residents' needs first.

And so I'm looking forward to really

I do have an answer to your earlier question.

Thank you.

Thank you, Chair, and thank you, Director, for the presentation.

Like other Council members, I've had folks reach out to me about the presentation.

It's really done well, and people can understand.

Some people that have been very angry watched the meeting last night, and some questions were answered, and I'm sure more questions will be answered today.

I don't have questions right now.

but I do have some comments that I want to make because residents are feeling really stressed about this levy and you know we keep throwing out this 11 percent number but that is certainly not

the number for everyone in our city.

And the north side is greatly impacted by any levy rises.

And so just the rising cost of living in Minneapolis has certainly been a burden for several years in North Minneapolis with the rising cost of everything.

and double digits are just really hard.

I will say that I was hoping that the mayor's budget would have dug a little deeper into cuts.

When I met with the mayor, it's no secret.

Everything on my list of things were cuts.

There was no asking for anything.

I asked for cuts.

I know that's hard.

I know what that does for morale in an organization, but

In this position, you have to have hard conversations.

And one of the big things is we don't have ARPA dollars like we had five years ago when we were around here making it rain in the city, right?

Like we had money.

We were putting it out there.

We had dollars to hire people.

We were creating departments.

We were creating all these things, but we had the money to do it.

And we were spending the money because we didn't want to give it back.

And so like we built up a huge city of things.

A lot of it I believe is duplicate services.

That was one of the things on the list that I gave to the mayor.

How do we evaluate duplicate services?

Because some of the things we built up certainly are happening at the county level or at the state level or nonprofits.

I mean we are certainly the land of nonprofits and these people are getting money.

to do a lot of things that we're doing in the city.

And it's not that the need isn't there, but has capacity being used in some of these other organizations?

No.

People are looking for people to use the services they have, but if we have them everywhere, why would they come here?

Right?

So, like, it's things like that.

Duplicates.

We don't have the money we had when I got down to City Hall, for sure.

I mean, we were trying to figure out ways on how to spend our offer dollars.

And we got really creative with it.

And we did some cool stuff that I don't know.

Is that cool stuff still working?

Is that cool stuff happening across the street?

Those are the things that I feel like is really missing in this.

When do we spend the time?

looking at that and making sure that with duplicate services, there's duplicate dollars.

Nobody wants to pay for the same thing at the county and the city.

So how do we fix that?

Those are some of the things that

Like this budget, it just, they just pop out at me.

Like how do we begin to do the work of that and fix that?

And then, you know, I know that public safety is certainly the category that's going over.

All facets of public safety are going over in our budgets.

Fire, OCS, police.

We have to look at that.

There's no way we can keep saying to residents that we're going $20 million over budget for police or nowhere.

Nobody wants to hear that.

It's not about whether the service is there or not.

People just don't want that.

People want good everything, but they also don't want to hear these large dollar amounts about going over.

So what is realistic here?

We have to be honest with people up front about what these services cost.

It really feels like some things have been hidden, and now the truth is coming out because

We don't have money anymore to, you know, do the things we have previously been doing.

So like now we're faced with the truth.

It's hard to tell, but we have to tell it.

The story is we can no longer make it rain.

It's a little dry over here, right?

Like, we're in a drought.

So we need to operate out of that.

That's hard.

That's hard for every single person in the city.

I, for one, would never want to cut positions.

But if the reality is that's what we have to do, that's what we have to do.

Nobody wants to, but sometimes that's the reality.

I also, you know,

explain to the mayor and his team that I do think, you know, the budget is, some people are saying transparent.

I think it's somewhat transparent.

There's got to be more opportunity to see line items and things that makes it easier for me to explain to constituents what they are paying for.

and that does not exist.

I know you all are working to do better and I have meetings with the budget team where things are explained to me, but I think there's got to be public transparency around that.

You can't say the levy is going to be 11%

and then say, well, I don't know how that was spent, right?

Like, I really don't know.

I know it was in this department, but I just don't know exactly where it went.

People are getting into this.

People, like, they know the budget like you all know the budget, and they want the real answers, and when you can't give them that,

It certainly feels like the city is hiding something.

And I don't want to add to what people already feel about government.

And so I think we have, you know, that you are certainly doing better in this department with opening up about some things.

But I think police for one, you know, Councilmember Chuktai and I have been for over a year now trying to get information.

And this is not about you.

This is certainly not about the budget department.

But like a prime example of this is we've been trying for over a year.

We tried behind the scenes.

We tried all the ways you can before we had to publicly ask

for information about the police department.

I would say the top department that I get questions about.

And so like everything has to be transparent.

We can't have like one department where I can explain it.

It's got to be every single department has to be available for me to be able to explain whatever, however, to the residents of Minneapolis.

And so I hope that you all will continue

the work on full transparency because we certainly need it.

And again, I was a little disappointed.

I thought I wanted a bolder budget.

I wanted, like I came, I literally came in saying 5% park board, 5% city.

How do we get there?

That's what I thought.

and so 11 is like fall off the couch, right?

Like it's like shocking to say.

I mean I'm not saying like my thoughts was real like that we could get there but like you got to aspire to something and so like I thought like let's let's just be even here let's show people like we can do it and so like when you do come back with 11 it's just it's nowhere near you know my aspiration and my dreams of what we could have

given to the city as a levy.

Those are my comments, but I certainly do appreciate this really thorough, easy to learn from presentation that you put together here.

Thank you.

I see several members in queue right now, and so I'll note it's 1142.

This committee meeting is scheduled until 1230.

We have a really important presentation from the auditor right after this, and so I just want to be mindful of time.

I really appreciate the very robust discussion we're having, and I certainly don't intend to cut that off here.

I see Councilmember Palmisano in queue, and I just would ask, is it okay if we go to Councilmember Warren first since she hasn't had an opportunity yet?

Wonderful.

Thank you.

Thank you, Chair Chuktai.

I don't really necessarily have a whole ton of questions.

I have thumbed through a bit of the budget and looking at a lot of the differences that have transpired since 2021 to our current time.

and in just echoing a lot of the things that we have done with our budget with respect to police reform, a lot of the services that are being offered now to community that, in my opinion, really should fall under the lens of the county because they are health and human services components.

So they really serve as another component not necessarily the fiduciary responsibility of the city and I know that we as the city at times can be quite generous in wanting to be the solution for a lot of the

needs of our constituents, but I believe that it is time that we share responsibility with county duty that the county then take responsibility of a lot of the health and human services centered items and line items that exist on our current budget, which wouldn't allow for people to be without employment, but it would mean that they would shift underneath the responsibility of another jurisdictional authority that

It still exists as a quintessential service that is provided to the community.

We wouldn't lose it, but it would be operable underneath the county and not underneath the city because I think those lines get blurred a lot where we see organizations like BCR that is underneath the city that really should be underneath the county because it just sticks across, you know, multiple

I think my council colleague Robin Wansley pointed it out very clearly as she was talking about the number of services that we provide across our metro and subsidy jurisdictions that

shouldn't all be our responsibility as the City of Minneapolis to provide those services to external, you know, more robust and it really should be a county-jurisdicted thing.

So I think as we look at, you know,

reforming our police department, reforming our communities, right, and how we're responding and what those services look like even for a lot of things underneath our health department.

The health department, in my opinion, should be underneath the county.

It shouldn't even be a part of the city that there are a majority of the services are really

centered around health and human services and that those things should be absorbed by the county to take responsibility for those things.

I think that these are just my thoughts of how we could really shift a lot of the things in our budget and forecasting that we absorbed as the city because we wanted to

stand up and be strong and like you know other colleagues talked about the ARPA dollars those were you know fun money to have but you know that monopoly money ran out right and it doesn't exist anymore and that doesn't mean that the necessity for the services

aren't quintessential to the individuals who need them, but they have become so duplicate and oversaturated within community that we have to allow for the individuals who are front-lined on that end of work who see the first line of response, which is the county that individuals are coming, whether it's social and emotional, chemical dependency, mental health, child care, this care, that care, let the county

to provide that frontline care of service and have the financial responsibility in order to do so because they got the bag.

They do.

And they can absorb that.

And that would mean that it wouldn't be a shift and a loss

so much of the jobs of what individuals are doing, but it would be a shift of who it is that you are reporting to and how those departments are supported.

So I think we have to draw a fine line in the sand as the city and say, hey, here's our responsibility as the city.

Here's what we do, that educational component, even for constituents when they reach out

to even council members and I'm saying this is being a new council member.

They reach out and they call me and I'm like okay I definitely understand your frustration with this but that is something that the county would support you with.

That's not the city support and that's not the city's lane so let me connect you with how

We build that education so that individuals know when they have a clear understanding of the difference between county services and city services.

The city should operate in its lane and let the county live in its lane.

Thank you.

Chair Chugtai, I will abbreviate my comments quite a bit.

I do want to just mention, mostly to my colleagues, that I'm a little concerned on what was slides 38 and 39 about the disproportionate impact to the city clerk's office.

Yes, they support the legislative department, but they also run elections and data practices, and I, for one, don't think now is the time to be scrimping on election-related support.

So I do fear that those are the kinds of things that we could start to lose and I want us to take an early look and start engaging in conversation on that.

The very last slide online had shown a lot of information and dates that as budget chair I just

Sorry, with you as budget chair, you had just communicated recently.

I saw it for the first time this morning.

Thank you, both of you, for this schedule, and I understand it will change, but I appreciate the starting point.

I will say, and I've been saying for several years now, getting a budget amendment packet two to three days before markup begins is too tight.

I hope that there's a way we could draft amendments and share them with all council members earlier in the process.

It is increasingly difficult to begin markup discussions when only some of us know what they are ahead of time.

I greatly appreciate that sometime in the past, for example, Councilmember Wansley offered all of her amendments to anybody that wanted to meet with her very clearly, and so I understood them.

So budget amendments say that they're due here November 18th and I'm curious if we could back that up as a suggestion a couple weeks to give us some breathing room.

Councilmember, thank you for bringing this up.

I think what you raise about making sure that the decision makers sitting here have the information they need in order to inform the votes that they need to take

and that that is of paramount importance in this process, I could not agree more.

And this isn't a this year thing.

That's not a this year, that's like a structural thing.

Agreed.

So in terms of moving the amendment deadline back further, a part of the consideration here, as you actually brought up, is the amount of or the responsibility our department has in administering the election and then certifying the election.

So wanting to leave some time there for the unpredictable nature

of this year's election and the implications it could have on our department and wanting to leave some breathing room there.

What I intend to encourage all colleagues to do, though, is

be as proactive as as is possible in sharing those amendments individually with with other colleagues or you know making other colleagues aware of things they're considering and then my office and the my office will be working with each individual council member and helping connect the dots between

similar ideas that are emerging, themes that are emerging.

I'm really, really happy to chat with you more about this offline as well and see if there are additional things we can do to help alleviate the immense amount of stress that appropriately comes with this process.

Let's do that.

And I just don't want a steady 13 silos talking only through the one hundred percent.

Awesome.

Thank you.

I just had one clarification point.

I know there was a request for additional information around line item.

I was able to find some of that in the spreadsheets that you had forwarded to us in an email.

Yes, through the Chair, Vice Chair Schaffer, and that's kind of part of our overarching commitment to the City Council as we go through the markup phase and department presentations.

I know we've already reached out to, I think, everyone's staff as well as them individually to share, you know, links to some of the materials that are available to be able to provide that next level of visibility down.

That may not be easy to access across 30 plus department pages in the PDF, but, you know,

as council members and their staff have the opportunity to really go through those and begin to understand some of that you know more finer detail behind department presentations and come to those department presentations really prepared to ask very specific questions about budget costs, personnel counts, things of that nature.

We're also happy to you know have conversations on those and I believe we actually have a training

Thank you.

I am not...

I'm gonna take myself out of queue.

I'm not seeing any further discussion, so I'll ask the clerk to file this presentation.

Thank you again, both for the presentation and for answering our questions and addressing discussion.

We are now ready to move to our second item, which is...

The Workforce Optimization and Comparative Benchmarking Report for this item we will be joined by City Auditor Robert Timmerman.

Welcome Mr.

All right.

Good morning, Chair Chugtai.

Good morning, Council members.

Good afternoon.

I'm Robert Timmerman.

I have the privilege of serving as the City of Minneapolis' City Auditor.

The Office of City Auditor is independent from the administration and City Council.

Independence is a cornerstone to our work.

As required by the professional auditing standards to which we adhere, which are the U.S. Government Accountability Office's generally accepted government auditing standards.

If you remember, our office was created during the voter-approved government restructuring of 2021, which elevated the function of internal audit within the enterprise.

Our mission is to strengthen public trust in city government by delivering independent, objective, and risk-informed oversight, assurance, and advisory services.

We safeguard public resources by identifying risks, promoting accountability, ensuring compliance, and supporting effective and transparent city operations.

The Office of City Auditor identified and has been monitoring significant budgetary risks to the city.

And last fall, we determined that a comprehensive review of operations comparing functions and resourcing to benchmark cities may help the city's governing body assess potential areas for cost savings.

To support this work, we engaged 65th North Group in November of last year to conduct a workforce optimization and comparative benchmarking study.

We presented the results of this study to the Audit Committee in April of this year.

And the Budget Committee Chair asked that we present again today to provide you with this overview.

Grounding your deliberations in objectivity is prudent.

I think it's very important that as you move forward over the next several months that you maintain that objectivity in your thought process and deliberations.

This report was intended to serve as a strategic management tool rather than a scorecard.

I understand that the administration considered and incorporated some of the study's recommendations in the development of the 2027 budget proposal.

And as you continue your work, I encourage you to seek clarity from the administration on those items that were implemented, were not considered, and the reasoning behind leaving some of those out.

Given the length of the report at nearly 200 pages, which is not something my office typically does, I acknowledge that there truly is a lot of information in here.

There is no apples to apples comparison between Minneapolis and the five benchmark cities that we selected.

But today's presentation focuses on the study's methodology, its resulting observations and recommendations,

rather than on the detailed data comparisons that you can find in the body of the report itself.

Comprehensive data analysis organized by department can be found throughout the report, but the observations and recommendations that we'll focus on today begin on page 181.

All right, the purpose of this study was to provide city leadership with a structured high-level assessment of staffing, expenditures, organizational alignment, and selected operational considerations across a broad range of municipal functions.

The study was designed to support informed decision-making by identifying where Minneapolis appears broadly aligned with peer jurisdictions, where meaningful differences exist, and where those differences may warrant additional review.

This study was an advisory review facilitated by our office and led by a consultant to provide a starting place for future studies, operational considerations, and budgetary planning.

It was not an assurance audit with traditional audit recommendations needing immediate corrective action.

The analysis in this report is based on a combination of benchmark city data and Minneapolis specific operational information.

Benchmark data generally includes authorized FTEs, salary and benefits, all other personnel expenditures, total expenditures beyond personnel, the composition of departmental expenditures, population-based comparisons, and related organizational context.

Minneapolis specific information was supplemented with interviews and departmental input to provide a clearer understanding of functional scope, current staffing conditions, vacancies, recent reorganizations, and operational pressures that may not be visible in budget figures alone.

Comparison cities were identified through a structured review process conducted jointly by members of the Office of City Auditor and 65th North Group.

We began with a pool of 10 potential benchmark cities and evaluated each using multiple factors relevant to workforce optimization and organizational benchmarking.

These included population scale, regional and geographic context, political and governance environment, cost of living, labor market conditions, and the degree to which each city offered useful comparisons for staffing, span of control, and organizational structure.

The goal was not to find cities that match Minneapolis perfectly, but to assemble a group that collectively provides meaningful comparisons across both similar and contrasting operating environments.

The final five benchmark cities were selected by consensus based on their overall usefulness as comparators.

This distinction is important because in several cases, current Minneapolis operating conditions differ greatly from the benchmark year figures.

Departments may have undergone staffing changes, vacancies, transfers, or reorganizations that influence today's operating environment.

So it's important to point out that the figures within the report were using fiscal year 2024 data.

We also, for the benchmark cities, used that data for their cities as well, 2024.

We did, through the interviews, receive updates and include some of those assumptions within the body of the report itself, because we wanted to make sure we acknowledged some of the changes that had occurred.

But at the time of this work, 2025 wasn't done yet, so that's why we used 2024 data.

The report recognizes that departmental budgets are not always fully self-contained.

Some functions rely on centralized support services, internal service funds, contractual arrangements, and interdepartmental cost allocations.

Others make budget totals appear larger or smaller than they would under a more standardized reporting model.

Where these issues were identified, they are addressed directly in the report.

Several themes emerged consistently across the departments that we reviewed.

As the study illuminates, differences between the city of Minneapolis and benchmark cities often reflect local policy choices and governance structures.

The report clearly notes where comparisons are limited by structural differences.

In some cases, benchmark cities do not maintain a standalone department for a given function.

in others, the functions embedded within a broader department provided through county or regional government or reported in a way that does not separately identify personnel and non-personnel costs.

These limitations require careful interpretation.

For that reason, the most useful application of this report is to identify where further policy or management discussion is warranted and where Minneapolis may wish to revisit how certain functions are structured, aligned, or delivered.

As a part of the Workforce Optimization and Comparative Benchmarking Study, the project team conducted interviews with leadership across all City of Minneapolis departments to better understand organizational structures, staffing levels, and expenditures, as well as service delivery models.

These insights were analyzed alongside data from our benchmark cities, which I indicated earlier on the slide as Baltimore, Colorado Springs, Tulsa, St. Paul, and Portland, as well as a broader best practices that's observed in moderate to large size municipalities nationwide.

Through these interviews and our audit process, several themes and opportunities emerged related to organizational alignment and service delivery.

The observations and recommendations on the following slides reflect our consultant's experience working with municipal governments across the country, as well as our own.

These recommendations highlight potential areas for consideration.

While they draw on industry expertise and comparative analysis, they do not represent in-depth operational reviews of each individual function.

For that reason, they are not intended to suggest immediate actions, instead identify opportunities

that may warrant further evaluation by the city.

Now with that said, keeping in mind that we presented this report to the Audit Committee and broadly to the public in April, I am aware that the administration considered a number of these recommendations in developing their budget proposal, as I mentioned earlier, and you will notice some of that as we step through each of the recommendations.

All right, so I am going to go through each of I believe are 11 recommendations that came from this report.

And I will just briefly provide a little bit of detail about those, those observations, those recommendations, and then we'll hopefully have a few minutes for any questions that you may have.

So the first observation recommendation was that the REIB department currently operates as a standalone unit, even though most equity-focused work naturally aligns with HR systems such as hiring, onboarding, training, and employee engagement.

Peer cities that we evaluated typically embed equity functions within HR divisions rather than maintaining separate departments.

Integrating REIB into HR could streamline policy implementation, reduce duplication, and strengthen consistency across the organization.

The recommendation here is to evaluate transitioning REIB into an HR division, which I believe the administration considered with their preliminary budget proposal.

The second observation recommendation was that Minneapolis is unusual

excuse me, Minneapolis is unusual in maintaining its own municipal assessing department.

Pure cities and most jurisdictions nationally assign property assessment responsibilities to counties.

County-level administration typically improves consistency, reduces duplication, and aligns with how tax rolls are managed across overlapping governments.

While city-level control can support neighborhood-specific priorities, maintaining a separate assessor adds cost and structural complexity.

The recommendation from our report is to consider transitioning the assessment function to the county.

Similarly, with recommendation three, Minneapolis operates a large full-scale health department, which is an uncommon model compared with most cities our size.

Those other cities we found rely on county or state public health agencies.

The current structure may duplicate county efforts and require significant funding and grant management.

Aligning certain services with county or state partners could reduce redundancy while maintaining targeted local programs.

And this recommendation is to evaluate which health functions might be more efficiently delivered or shared at the county level.

I'll mention in my preliminary review of the administration's proposed budget I did not see obvious moves to the county with either health or in this case the assessor's function.

That said, in conversations that I've had and the reality is any move from one governmental entity to another would create significant coordination because of course the other government entity would need to find ways to fund the services that we would be giving up.

That said, I think there's some appetite across the city from folks I've talked to in exploring this further.

Observation four, as far as the governance structure of MBC, the Building Commission operates independently under state statute limiting our ability, our being the city's ability to direct facility planning, budgeting, or operational priorities.

The interviews we conducted indicate that current structure may not offer the responsiveness or alignment expected for citywide capital and facility needs.

Many cities consolidate building functions internally for clear oversight and coordination.

We recommend here that the city evaluate the Commission's governance model and consider seeking legislative changes if warranted.

Again, we don't have time to go into each of these in depth, but these are not new conversations.

Number five, fraud risk vulnerability study.

The Office of City Auditor has spoken a lot in the last year and a half about enterprise risk management.

This was a recommendation that, quite frankly, to maintain my own independence and objectivity, I did not push for, but our consultant identified, noticed, and of course, we support.

In this recommendation, we've noticed that the annual financial audits do not identify fraud risks at the operational level, which leave potential vulnerabilities undetected.

Our consultant said that many local governments experience fraud incidents that persist for years before discovery, highlighting the need for proactive assessment.

Although the Office of City Auditor performs fraud risk assessments on each audit and as a part of our annual risk assessment, the idea here is that a fraud risk study could examine systems and processes across all departments to identify gaps and strengthen controls.

Number six is to discuss improving cross-departmental alignment.

It was very clear, and again I don't think it's a surprise, that there are overlapping responsibilities across departments.

We've heard over the last several weeks about overlapping responsibilities between the Parks Board as well as the city.

Our interviews definitely confirmed this.

There's duplication of effort, there's unclear accountability, fragmentation hampers coordination, it slows decision making, and it reduces opportunities to leverage shared expertise.

More deliberate alignment of departmental missions and functions could improve service delivery and efficiency.

The recommendation from the report is to conduct a mission level review to clarify ownership and reduce redundancies.

All right, number seven, Minneapolis operates an in-house crime lab, which supports investigative responsiveness, but requires ongoing investment in specialized staff, technology, and accreditation.

Many jurisdictions use county or state labs or hybrid models to scale.

Outsourcing some forensic services may reduce costs, but could affect turnaround times.

The recommendation from our report is to evaluate alternative service delivery options for crime lab functions, again, to consider those cost savings and to determine if the city can tolerate longer wait times.

Number eight, and I'm going to stray a little from what we have on the slide here, but the

The draft that we finalized and put forward discusses evaluating and taking a look at Parks Police being a duplicative function of the City of Minneapolis Police Department.

While this is an observation, we've also heard recently, and I would add to this, that HR functions, finance functions, and other service provided by Parks may be considered duplicative.

The recommendation in the report is simply to assess potential consolidation of some of these departments.

Number nine is related to elected officials and the staffing support.

Again, I'm going to caveat this like I did with the Audit Committee that these were observations made and compared across five different benchmark cities and some language that came from our consultant as well.

The consultant in our report had identified that two full-time aides per member is more staff intensive than the other cities we compared against.

While this does enhance constituent service and policy capacity, it also increases governance costs that may blur the line between policymaking and administration.

Alternative models such as a shared aid pool could reduce costs while maintaining service levels.

The recommendation here is to review staffing structures and the full-time council model, which was another report that was issued by the legislative research and oversight group around the same time that this report came out.

All right, two more, number 10.

Public Works operates a separate solid waste call center despite the city's robust centralized 311 system.

Maintaining separate intake channels can confuse residents and duplicate staffing technology and training.

Consolidating solid waste customer service into 311 could streamline access, improve data tracking, and reduce parallel structures.

Here we recommended an evaluation to integrate that into 311.

And then finally, BCR and the commentary that came up in the last presentation touched on this related to BCR, but of course they operate under a contracted model within the fire department.

Interviews indicate limited visibility into their staffing protocols and operational decision-making.

Concerns include inconsistent call acceptance, unclear qualifications, and evolving practices not fully aligning with city expectations.

A critical emergency response program requires strong oversight, clear KPIs, and accountability mechanisms.

Our recommendation is to evaluate transitioning to an in-house model or strengthening contract oversight with measurable performance standards.

For your awareness, this was of great concern to our office and so we're actually performing a full review of BCR at the moment with the report anticipated in October.

At the conclusion of our study, we requested a formal response from the administration.

The City Operations Officer and Commissioner of Community Safety provided a letter emphasizing their commitment to ensuring that the City of Minneapolis continually evolves and improves, noting that progress is both an expectation and a core value.

They highlighted that comparative benchmarking offers a valuable external perspective, surfacing opportunities that may not be visible from within the enterprise and helping frame a broader context for strengthening operations.

They also reaffirmed that the city work, I'm sorry, they also reaffirmed that the work city employees perform on behalf of Minneapolis communities is essential and deeply valued, and that the city's workforce must remain central to any discussions about potential organizational adjustments

informed by this study, and I would reiterate, informed by budget decision making.

I do appreciate that that has been communicated by both the administration and the City Council as a key priority.

As I noted earlier, it's worth recognizing several of these recommendations have been considered.

There's room for considering more.

I think that's what the Budget Committee can do through its conversations with the administration and potential amendments.

At this time, I will stand for any questions.

I know I went through that very quickly.

I'm trying to be considerate of your time, but I could talk about this all day.

Thank you for this presentation, Auditor Timmerman.

I asked you to come in today and for this to be the start of a part of the start of our work in digging into the 2027 budget.

Because I know that a theme that's emerging on across this body is a desire to bring

the levy down while preserving core city services and to do that we need to be able to consider from a place of as much objectivity as can exist in this type of process.

where opportunities exist for further reductions in different parts of our of our enterprise.

So the goal here was to make sure all members of the Council also have this information presented to them.

I know there was pretty significant discussion about it in the Audit Committee, so I wanted to bring it here as well.

I'll see if there's any discussion or questions from my colleagues.

Thank you, Chair.

I just had a question about, because you've done like an overview of some of the departments merging with other departments.

I've always wondered about fire inspections and why they are not in the fire department.

I don't know that we went into the details of that in our written response within the report.

We learned a lot about it in our interviews.

I would say that I would defer specific response to the fire department or to regulatory services.

We heard from both of them who shared that it was a historical institutional decision that was made within the administration many, many years ago.

Quite frankly, I didn't hear a single person say it made sense.

I agree.

I mean, I've just always wondered why, and I got the same kind of background that you got that someone just made an executive decision to move it out, but it doesn't make a lot of sense to me, and it sounds like to a lot of other people also.

It certainly doesn't make sense to residents.

Like, when you say who's coming out and what department people need to contact, they are

interested in why it's not fire, right?

And so the one thing I do want to be cautious about though is I'm not interested in changing the makeup of fire, like the requirements to be a fire inspector or those sort of things.

I just like how BCR is in the fire department.

That department just belongs there to me because I do know like that group of people

have different backgrounds.

They're not firefighters.

You know what I mean?

They just have a different background.

than the firefighters do, but I do just wonder why we haven't moved that.

So do you think that there's an opportunity to do a little bit more digging and investigating?

I would say just on the surface, I think, and without a lot of detail or having done a specific review, I think it is a warranted move.

Our office could certainly take a look at that.

I think during the budget conversations that you have with reg services and with the fire department, it's quite possible that they may even agree to this.

And it could be just shifting some resources.

I think that wherever we can find areas to break down silos, the better.

Yeah.

Thank you.

Thank you for saying that because I certainly believe that

while we're talking about transition in departments.

Like REIB, that makes sense to me too.

I've always asked that.

Like racial equity work should be done throughout an organization, throughout the enterprise.

It should not live alone.

So I've always questioned that.

I certainly understood the answers that have been given to me that people wanted it to be this kind of standalone neutral department.

but I do think after time if you've done the work and you know the department transitions to other things too like maybe it does start off as standalone but you figure out that it needs to be somewhere else or that it's better suited to understand

when it's somewhere else for people, not just us internally, but for the general public also.

So I love that you've started doing this work and looking at the overlap, the way we can merge things, the duplicates.

There's a lot of here about what you and I have had conversations.

So like the duplicate stuff means a lot to me too.

So I do appreciate you meeting with me and looking forward to the continued meetings that you

and I and our teams are going to be having around some of this.

But the merging of the fire department and fire inspections is certainly a priority for me and I'm happy to do the work as a Councilmember and bring something forward throughout this process.

But I just wanted to see if it was something that is even on your radar and if we can

begin doing the background work because I certainly don't want to present something to my colleagues or the general public that there's no background.

Chair Chogtai, Councilmember Vita, I will take that away.

I'll follow up with your office because I think we can ask a few questions and if you take the lead or if there's others interested in that we can at least provide some additional background.

Thank you.

You're welcome.

Thank you very much.

We have a couple more council members in queue.

Can you speak to in the consolidation category we talked about MPRB in the city.

Oh gosh, I will be completely honest, I did not read back through every single department narrative within the report in preparation for this morning, but I do know that there's additional detail within each department that speak to some of those things.

You know, for example, I don't believe that that the NCR communications piece that we heard about in the earlier presentation, I don't believe that was something that had been pointed out in our report.

But that is the type of thing that we were looking for is, you know, are there the 311 and the public works call handling?

That was an example.

I would say that there are some financial folks embedded in various departments.

There are some human resources folks embedded in various departments.

And in some departments, that makes complete sense.

In some departments, they have 500 or 1,000 employees.

And so there is a need for some of that.

But it doesn't necessarily mean that it needs to be an HR professional.

It could be a liaison to HR.

I would say that the biggest concern that I have after going through the interviews and the conversations was the lack of overall hierarchical strategic planning.

And I know the Council, along with the administration, has been working towards that this year.

I do think that when

Your business plans for your departments roll up to a larger mission, vision, value system.

It sets tone at the top.

It definitely builds in those organizational controls.

And so I would

I would highly encourage further exploration of an enterprise risk management function office.

I am a broken record on this.

Every time I speak with you, I bring up enterprise risk management.

There should be a function at an executive level within the organization that is considering how can we build strategy within our silos to flatten them and to ensure that they are all following citywide policy, whether those are financial, whether those are operational.

Okay, thank you.

And in the fraud category, I mean that's related, you know what you just detailed there, but was that how they detailed a dealing with this or was it more of a one-time look?

So the recommendation here, I will be completely honest with you.

It is a service that this particular consultant offers.

I was pleased with the work that we had from this consultant.

I would not be surprised if it was also a bit of a sales tag.

Sure.

And so I think in full transparency, it's important to identify that.

That said,

Management typically, not audit, is responsible for a full-scale risk assessment of an organization.

In the City of Minneapolis, the Office of City Auditor has always done it because in the ordinance, before the Office of City Auditor was created in 2021, the ordinance required the internal audit department, which rolled up to the COO or whatever was parallel to the COO at that time, to do that work for the administration.

What should happen is management should have individuals and a responsibility to perform not only an enterprise-wide risk assessment, but also to inventory internal controls beyond just financial controls, controls that look at safety risk, that look at reputation risk, all of the types of risk that are presented to our city.

When you look at professional auditing standards or you look at professional internal control standards, enterprise risk management standards, that's a function of management, not audit.

What I think the consultant identified is that that's not happening.

that definitely increases fraud risk.

We didn't identify fraud as a part of this.

And in fact, you know, fraud, the reality is, is a small fraction of any goings on in any enterprise.

But when we identify that there's increased opportunity for fraud to occur, that's what we want to make sure that we're communicating.

And so I think that's what they identified here.

Thank you.

Yeah, thank you, Chair Chuktai.

Also, thank you, City Auditor Timmerman, around just highlighting the need for this risk assessment.

I know that's been an ongoing conversation.

Also, we have the ordinance notice for that in our

Working with the mayor's administration on getting resources or identifying potential resources to staff up that division, but I think you highlight that throughout the optimization report in terms of, you know, how we're constantly

are putting ourselves at risk by not having a systemic system in place that many other cities across the country do have these type of things at the executive level, how that does put us in this predicament where we could be at risk.

And I am very much looking forward to getting that across the finish line by the end of the year.

And overall, I just want to say thank you for this assessment.

I made the comments earlier in the budget process while we're looking at the government structure ordinance that would require us to either do some of the recommendations and I see in the mayor's proposal that some of these recommendations are

somewhat reflected.

But I think there's been a long discussion amongst my time on this body is it felt like government structure and the reorganizing was really just done by throwing stuff at the wall.

It was not really intentionally thought out.

We did not bring in, I think, intentional

to help us map out how

and I'm hoping we're not walking into this budget season basically doing this again another piecemeal matter with government structure that then we have the potential to be locked in should this go forward to the charter commission then put on the ballot for voters to then you know put into permanent placement.

We should not be organizing a government entity in that way.

We've done that thus far with the phasing of government structure, so I think this gives us some neutral and credible things to weigh in as we're looking at the third year of government structure, how we can be looking at the places for duplication.

Councilmember Warren mentioned this.

These are some of the things that I've weighed.

surprised to hear the support for even transitioning some services to the county.

Because when I was proposing moving some of our violence interruption services to the county, I was met with tons of pushback and resistance from the mayor.

And actually, there were incredible allegations of fraud being directed at the county, which is crazy in our current national climate, that was used as a means to say, we should not be moving that work there.

And I was like, this was a great opportunity to have that partnership with the county

that is respected in doing community safety services.

So I'm glad to see that there is this recognition that there is a way in which we could be working closely with the county to provide some of these services that we've just, you know, may stand alone and recognizing that they might have the capacity to deal with better efficacy.

Something else that I was really excited, especially in our leadership conversations for the recommendation was the Minneapolis Building Commission.

This has been a long contentious discussion point in terms of the troubles that a number of us have had.

have had, especially with us moving back into City Hall.

And City Hall, one, belongs to working class residents.

They pay for this space.

This is a public space.

But with the transition, it has not felt like that.

They have been met with such resistance.

There's been almost feelings like enactments of censorship where residents can't fully express themselves in our chambers.

It just has not been a really

smooth process or welcoming process.

And I know the Building Commission, along with some of those concerns, there's a whole host of other concerns.

It's been a challenge to work with them.

And I know there was efforts with our IGR team some years ago to try to figure out how to make some changes possible at the state level, because I think that's what we would also have to do.

But I was really glad to see that that was referenced as one of the recommendations, because this has been a sticking point for many of us of why does it exist?

in so many ways.

Who else has this across the country?

It just makes no sense to me.

And then also just some of the things that Councilmember Bittar raised in terms of REIB, which I also really respected

and that was highlighted in this report.

That's another one where it was like REIB during government structure really didn't have a set goal.

And I think there was some of that too of like you use the framing of it's not consistently structured across the enterprise.

And I think that was always the case.

Many of us coming out of 2020 assume that REIB will have an external interfacing

Roll to really make up for the racism that we enacted as a city, as codified by our resolution that says racism is a public health emergency.

And somehow that shifted to an internal role, which in that case, then, yeah, it does make sense.

This should not be a standalone division.

I think when there was a goal to have it be more publicly interfacing for the city to be more proactive in the truth and reconciliation process that we've walked backwards from, it made sense for it at that time.

But I think the recommendations from the study really shed light on the fact that the unclear intent and role of that now has put us in a place where, okay, we're going to have to reevaluate that office.

Again, I just want to name this optimization study has been something that I think a number of us were really excited to see.

Wish we had this when prior leadership was guiding the legislative body through the government structure ordinance.

And again, it just felt like it was pulled together with tape.

And I think we're constantly having to evaluate now, three years later, many of the ways that it's not working, most importantly for our residents.

And hopefully, in the next iteration of structuring, we're referencing this so that it could be a more

Thank you.

I just wanted to speak to a couple things.

I was on the NBC.

a four term and I, you know, what we were looking at was who provides the leadership over the MBC.

So the county and the city has appointed folks on the MBC.

But the county is the chair, and it's our building.

Like, we're in here.

They're not even in here, right?

So, like, those are the things we were looking at.

Not necessarily the existence of the MBC, but who is the lead government?

Like, for me, I would want the mayor.

The mayor is appointed.

I would want the mayor to be the chair of the MBC if the MBC exists.

We did some work to try to look at how we could separate things or what could change.

It failed at the state level.

I mean, like, it literally fell apart.

There was no movement or anything on it.

And so there's always been questions about it, but I think there's been different questions.

And the one thing that we kind of got to a compromise on is leadership.

Who plays the, like, premier leadership role on the NBC?

Internally, there was conversations about quorum.

which fell apart because like there's only four people there right and like per the law three people is a quorum and you shouldn't change that to two.

There was some things you know like about the bylaws but I think overall it really has been you know

who gets to be the chair of the NBCs and the budget stuff because we're all giving the NBC money to so there's always been conversations about the budget and then with the you know you talked about like merging some of the services

Just for clarity, I think what we are having conversations about is not the city giving the county money for services, but the county like being responsible for the service.

So like the violence interrupters, not the city giving the county money for the violence interrupters.

The county has its own violence interrupter program and then funding that

and us using our dollars for other things in the city of Minneapolis and other departments as well, like social service initiatives that are at the city, not us asking the county to house them and us pay us for them.

We're talking about how we, you know, don't duplicate services or using dollars for the same thing.

And I would say that would be the same for the BCR.

I don't want to speak for Councilmember Warren, but her and I have had

lots of conversations about the BCR, whether it's internal or whether it's, we use COPE as a program for the entire city of Minneapolis versus having a BCR, right?

And we're not talking about, at least Council Member Warren and I are not talking about paying the county to house the service.

Thank you.

Thank you for that, Chair Chuktai.

Actually, Councilmember Vitale raises a couple of points in terms of just clarification for the study.

So, I know, I don't know if our contractors who did this carried out conversations with the county, but the reason why there was a proposal to shift resources and thus

with them managing the contract means they're managing the services themselves because they have contract based services that do something similar.

There is also this idea that they're just going to do it for free.

And the idea of there is expected

some levels of shared costs.

Now I think with government structure and legitimizing it, again, that's going to have to come at some more thoughtful conversations of what that split looks like.

But the idea that the county is just going to, you know, bottom sell, just absorb all of these without some level of financial agreement around shared costs and expenses is just not

reality.

So I think those were some of the groundings around what are we looking at shifting over to the county.

I don't know if the study also looked at that but it sounds like that would be part of subsequent conversations because they're looking at their own respective levy increase as they're being faced with similar financial, well let me not say similar, but they are being confronted with their own financial challenges too that's leading them into budget deficits.

And also with the BCR piece, one thing that I did see come up in the study was also the evaluation of PMI.

And this is one too where I think we're going to have to do continued discussion on of the study highlights that these

The role of PMI, like you're looking at performance, that is, that should be happening all across the enterprise.

Now, has PMI again, post government structure done that?

I would say no.

But prior to when we're talking about BCR, they were leading.

in terms of doing some of the similar things, working with credible, respected experts across the country to do analyses around what services are the city not providing, what are some newer areas that we could be, and that is where, not specifically, well, where BCR came from.

They looked at programs like Cope for Existence and said there's gaps there that is needed for our residents that cannot be basically meet,

met by the

the problem in our financial arrangement or organizational structure like why they provided that as a new program recommendation.

But I do see the recommendation more so looks at what could be the on ramp of bringing it in house, as opposed to say, let's just defer to the county to provide that service altogether.

And I think that is worthy of conversations actually Councilmember Chavez and I brought Metro Transit

to the Public Health and Safety Committee last year to basically talk about what their process was for bringing essentially their safety ambassador program from a contract process but through in-house, how they were, you know, modeling that.

And they shared some really good insights that I think is worthy of further conversation and it's clear that they've scaled that up since that presentation, but I think that's a different type of conversation than saying just let cope

Excellent, thank you.

I see that we are at quorum right now.

We have one more council member in queue that I will recognize and I believe hopefully that should address the questions.

Thank you so much, Chair.

I don't necessarily have a question, but I just wanted to provide some additional context around a conversation that I have had with my council colleague around the essential services that are being provided by county.

I think it's great that we, as council members,

are able to see the deficits that are existing within our community and instrument programming, right?

Or come up with ideas and move things and ordain things in order to ensure that there aren't gaps or try to close those gaps in order to better meet the needs of our constituents.

But I think that once that happens,

We have to find a place for that work to actually live so that the city itself is not burdened with the responsibility of having the financial constructs to maintain whatever is happening because that's why we have things like CPED, that's why we have things like

you know reg services that's why we have you know or or even the county services you know like that that are there so that it has a home we're able to home those programs underneath certain things and then seek additional assistance from the state through our IGR in order to see that they are able to keep those funding those programs funded underneath wherever they're now housed which doesn't have to live with us right

And Coke was just an example.

I don't think Coke should be, you know,

Countywide or Citywide, I've got, you know, but it was just an example, right?

Of knowing that, you know, someone could pick up the phone and call, cope or call, you know, first call for help or call these people or whatever else the case is and then you're pivoted to these services.

If the city is housing those same duplicative services, then we end up with more stagnant buildings

in our communities like what exists in North Minneapolis of nonprofit organizations that are not, you know, turning the doors open and closed for individuals to come in there and receive the services that need to be received.

The programs are not

We saw it during the rental crisis around Operation Metro Surge.

We as the city gave money

to the county, the county received a great deal of money to help with rental assistance.

And I think as the report that I've seen not too long ago, Ward 5 utilized over $207,000 of rental assistance from the county.

And we gave a lot of money to the county, but the county really didn't come to us and ask for the financial support.

And I think that as, you know,

a council member, I would be very cognitive of when the county came and asked for support before I offered my financial supports to something.

If they're not coming and asking for it, then I'm going to assume that they got it in a bag or you know what I mean in a suitcase or whatever.

Somebody's carrying the bag or the barrel or whatever the case is, but it doesn't necessarily have to come from me.

And I think that

That is part of the inner workings of government that we would like to see.

We want to see a tight relationship between our police chief and our county attorney.

We want to see tight relationships between regulatory services and CPED.

We want to see a tight relationship between the city and the county so that we can ensure that the deficits that we see as council members that are coming through our neighborhood organizations and saying, hey,

We're missing some things here.

We can work cohesively with the county to ensure that those things are getting brought across to them, right?

Because that's how teamwork make a dream work, you know?

We have to be able to work together cohesively to fill the gaps and that doesn't

mean that I'm paying you to do something that means that you're using the resources that you have and the greater amount of funding that comes from be it Met Council or whomever to provide additional services and from the state they get far more funding to be able to fill in those gaps and yes that may mean that we as the city don't have oversight over that program but that's okay.

We don't have to do everything.

We can operate within our lane and be as equally as successful as an entity.

And then where we see those deficits, there's oversight that is missing, we can work with the county and those organizations to figure out how to strengthen those things.

But it doesn't mean we have to take it on and do it ourselves because that's

Totally not necessary.

I think that's how we got ourselves into this budget crunch of where we are now, even dating all the way back to 2011 when we aborted the neighborhood revitalization programming and we took away so much power from community that needed the power

there which is the first tier of government is the neighborhood organizations and now we absorbed all of that and said we as the city will do everything we'll figure it out no we don't need the county no we don't need these people and now we are in a whirlwind of a bad spin down where we're the same thing you put on a burger which is ketchup and now my ward specifically the fifth you know

is looking at anywhere between 11 to 18 percent tax increase like we can't afford that I can't have elders making a decision about heat or eat you know what I mean do I eat or do I have heat you know what I'm saying through our long Minnesota winters and a lot of things then are you know it's tight our foreclosure

Crisis is exceeding and we are not being mindful of how we are spending and the things that we are investing in or holding on to programs long after they are no longer needed or don't have to live under the auspice of the city.

These are just some of my thoughts.

It wasn't necessarily a question.

Great job.

I appreciate all of your hard work.

Keep up the great work and yeah, eventually we'll get there.

Thank you.

Thank you, Chair.

I did want to note that the occupation of Minneapolis by the federal government did cost over $700 million in impacts to

our city.

Part of that includes an estimate of 62.8 million in rental assistance needed from December through March.

So there was a big cost that many of our neighbors are still struggling to pay rent.

It was a big impact and I do think it's the responsibility of the City of Minneapolis to help those neighbors out because these are our residents that deserve that help.

It shouldn't just be on the county to assist people with rent assistance These are our residents as well as I said an impact of 62.8 million in rental assistance needed from December through March that doesn't even include after March where in September There's even more of an impact from them.

Excellent.

I believe that we have reached the end of discussion.

I'm not seeing anyone else in queue.

So I will direct the clerk to file this presentation.

Thank you again, auditor.

With that we have concluded all business to come before the committee today and if there is no objection we stand adjourned until our next meeting which is coming up on Monday September 14th at 10 a.m.

I will note that on September 14th we have two Budget Committee meetings one in the morning and one in the afternoon

In the morning session we are receiving presentations on the 2026 council dedicated funds and the 2026 change items report as well as the biannual personnel report.

These will serve as baseline information just like we received today that helps us have contextual information for individual departmental presentations.