Here, here Terry! Thank you for taking the time to review the Minneapolis city budget and provide your realistic insights to your readers. Let’s hope the decision makers take the same approach you are recommending and cut where needed.
I especially like what you wrote here:
But nothing focuses attention quite like opening your property tax statement, reviewing your health insurance premiums, or filling a grocery cart for the holidays. When basic household costs are rising across the board, it becomes all the more important to ask why the city plans to spend $140 million more than it did last year. A closer look isn’t just reasonable—it’s responsible.
The primary reason I didn't rank Mayor Frey is because of fiscal irresponsibility. We simply cannot be asked to absorb 16% property tax increases to pay for 24% salary increases. Contracting for services that could well be done by city employees is massively expensive. Somehow, the city budget has to be tied to inflation; like other public and private sector budgets are. I have no intention of being forced out of the City of Minneapolis because I can't afford property taxes! Happy Thanksgiving!
There's no point, of course, to relitigate the recent election. But I'd put at least as much blame, and probably more, on the city council for the weak financial position of the city. Their 73+ amendments made last year to the current year budget, many of them characterized as for unvetted, unevaluated "pet projects," is a driver. We'll see if we get a repeat of this in adopting 2026 budget. And also the complete lack of a strategy to protect residential property taxpayers from sharp decline in commercial values shifts the burden to homeowners (and renters though some seem not to know this). Add to this the blatant anti-business attitudes of the council since at least 2018; this does not build financial strength.
of course CM Wonsley wants to add to the budget for her Municipal Grocery store idea and a handful of other ideas (some of which might be helpful for city residents). but if each council member adds half a dozen additional expenses.... well I do not need to be an accountant to know you cannot just add expenditures. We see how that played out last year with each person having their own agenda and their own fiefdom on the council. If an additional 70 things get added to this.. Yikes!
IMO clearly some expenditures need to be SUBTRACTED from the budget.
Thanks for the excellent perspective. How can we impact this beast, which will continue to need ever greater taxes? Certainly the DSA majority cares nothing about homeowner property tax issues, and the budget apparently has Frey approval. Is there a meaningful way to oppose excessive spending?
See my previous comment. It's very common in the private sector to have jobs that are less than full time, and other jobs that are allocated across projects or departments. It is a best practice to measure these accurately.
You’re technically right, David, but it hinges on the context. When justifying capital projects, for example, it’s generally considered a major faux pas to claim a labor reduction of 0.27 people. The reality is that it’s difficult to save headcount that way. You either eliminate a full body or you’re not allowed to make the claim in your justification. I’m not inclined to give our politicians benefit of the doubt based on the other shenanigans they have proposed, such as city-owned grocery stores and city-wide sidewalk snow removal. They seem incapable of seeing the big picture or performing even simple math.
Mike, I can very readily agree with your last two sentences.
As to the FTE accounting aspects, I'm sure different organizations and different CFOs have varying views on these matters. My own many years in a fairly capital-intensive medical organization (where I was the CFO a couple of times though mostly my responsibilities were elsewhere) was to be precise in FTE estimates as in all else. If a piece of lab equipment would replace two full-time employees on the evening shift and a half-time employee on the overnight shift, our justification claimed 2.5 FTEs. And we enforced the claimed reductions, the lab director could not say oops, I need some of this back.
This is minor in the scheme of things and hard to say there's one definite right answer. However, I think we would agree that in building and executing budgets in a large, complex organization, what is truly important is accountability.
No member of our current city council majority has ever held a high, responsible position in any large, complex organization. Big picture, simple math, all outside their realm of experience.
Yeah, I recognize different organizations will do it differently. But in competitive environments, effective organizations have no choice but to manage finances tightly. My background comes from capital project management in food processing. Like your experience, our labor-saving claims were enforced after project implementation. But senior management was also highly skeptical of fractional FTEs, because in 24/7 continuous operations, there were very few instances where we could actually eliminate a portion of a position. Even if a worker ended up with spare time to do other things, we couldn’t claim that unless we could eliminate their position altogether. Part time workers were extremely uncommon.
But both of our comments are nuance. To your point, most of our council members have zero experience to even have this discussion. Cannot be trusted to manage anything more than their household budget. If that.
Good summary. It seems crazy to me that the budget is increasing at the same time that the homeowners' tax bill is going up due to declining commercial property value. Even if the 2026 budget were the same as 2025, our property taxes would still go up due to declining commercial property values. In a political moment when affordability is the buzzword, one of the few things the City can control (its budget) is going out of control.
I, too, am concerned about the City's outsourcing. I have no reason to believe that they could do it better/cheaper in-house. The key, as you say, is ensuring the City is highly skilled in contractor management.
This Mpls Time's piece from Dec 2024 was stunning to me. While we suspected that most of our council members knew absolutely nothing about money, or ANYTHING related to budgets and being fiscally responsible, and they didn't seem to be in the business of learning anything either, one thing that they did KNOW, ( which surprised no one) was how to USE the budgeting process/and other people's money, to help themselves. How did that work out for them, well sadly, pretty well, since the majority of that DSA aligned voting block got re elected.
Excerpts from the piece..
"Much of this is being done to curry favor before an election year."
"By far the biggest number of proposals are what I like to think of as “Giving money to your friends.” 33 proposals, about half, were to give money to non-profits. Money for the Latino Business Week and Trans Summit and façade improvements on Bloomington Avenue and Mercado Central and the Indigenous Wealth Building Center. The biggest, $1 million was for building improvements for unnamed non-profits in North Minneapolis. The list goes on. Hundreds of thousands of dollars to non-profit “safety” programs, with only vague explanations of what will actually be done. $25,000 for stipends for people serving on the Safe and Thriving Communities Work Group, essentially paying anti-police activists. $500,000 to a group to tell us how we can stop producing garbage. $50,000 to a group to tell us how to implement free phone charging stations. Much of this is being done to curry favor before an election year.
Another big group of proposals is the “Duplicating what other government is already doing.."
We are incredibly thankful for all of the efforts that made the 2025 Municipal election such a success for Minneapolis. Unfortunately, the City Council majority that voters just showed the door is going out with a vindictive, immature parting shot at our newly re-elected Mayor.
Instead of helping our city move forward, the outgoing City council majority is spending its final weeks pushing a grab-bag of unreasonable budget amendments in a last gasp attempt to either push their own far-left agenda or to punish their political opponents, particularly Mayor Frey. One of the proposed amendments reduces the Mayor’s office budget by such an absurd amount that it would result in a mayoral office with no staff.
According to the Star Tribune, “(Mayor) Frey also proposes reducing his office budget by nearly $23,000, but some council members want to cut much deeper to help fund their initiatives. Taken together, several of their amendments would mean about $1.2 million in cuts to Frey’s budget of $2.7 million. That would require firing most of his 15 staffers.”
This is exactly the kind of petty, destructive behavior that Minneapolis voters just rejected in the last election.
Fortunately, there is some good news. Four new council members — three of whom All of Mpls was proud to endorse — will take office in January. We believe these new members, along with a number of re-elected members, will finally turn the page on the chaos of the last few years and focus on stability, collaboration, and results.
Please stay posted for updates on key budget decisions in the coming days. Meanwhile, thank you again for everything you did to help deliver much needed change to our city government. Minneapolis is on a better path because of you.
The unfortunate part of all of this is, we will still have a sizable group of these same folks on the City Council after Jan. Due to some significant lapses in their personal and professional development, they cannot know that there will be no movement, NO place for them outside of the hate a mayor/ hate a cop, DSA world...so all of their potential political endeavors will be quite limited, IF they exist at all. In the meantime, we will keep paying them, and find any and all ways to step over and around them.
Terry, that I'm looking at this stuff on Thanksgiving morning might place me even higher than you on the Nerd Index. But I do have a couple of questions about your budget analysis. And I fully understand you haven't spent "dozens" of hours, nor have I.
But I do wonder if you are treating the capital equipment item correctly. It sounds like this is part of the capital budget, which, through borrowing, spreads the cost of capital investments over years and decades. The true impact on any year's budget would be the debt service, which is already baked in; the debt service on the new spending of $89 million in 2026 would be a small fraction of that figure.
Also, maybe it's 'cuz I am indeed cursed with an MBA, but I much more readily accept accounting for FTEs in fractions. In large organizations, many people work other than full time, and many others have jobs that are allocated to more than one function or department. We really do want to account for people-costs accurately, and that means fractions.
Given the holiday, we can be thankful for you, Carol Becker, and Steve Brandt, all of whom really do dig into "boring" budget documents.
Here, here Terry! Thank you for taking the time to review the Minneapolis city budget and provide your realistic insights to your readers. Let’s hope the decision makers take the same approach you are recommending and cut where needed.
I especially like what you wrote here:
But nothing focuses attention quite like opening your property tax statement, reviewing your health insurance premiums, or filling a grocery cart for the holidays. When basic household costs are rising across the board, it becomes all the more important to ask why the city plans to spend $140 million more than it did last year. A closer look isn’t just reasonable—it’s responsible.
Have a wonderful Thanksgiving!
Thanks, Judy. Having recently done those things made it feel natural.
The primary reason I didn't rank Mayor Frey is because of fiscal irresponsibility. We simply cannot be asked to absorb 16% property tax increases to pay for 24% salary increases. Contracting for services that could well be done by city employees is massively expensive. Somehow, the city budget has to be tied to inflation; like other public and private sector budgets are. I have no intention of being forced out of the City of Minneapolis because I can't afford property taxes! Happy Thanksgiving!
There's no point, of course, to relitigate the recent election. But I'd put at least as much blame, and probably more, on the city council for the weak financial position of the city. Their 73+ amendments made last year to the current year budget, many of them characterized as for unvetted, unevaluated "pet projects," is a driver. We'll see if we get a repeat of this in adopting 2026 budget. And also the complete lack of a strategy to protect residential property taxpayers from sharp decline in commercial values shifts the burden to homeowners (and renters though some seem not to know this). Add to this the blatant anti-business attitudes of the council since at least 2018; this does not build financial strength.
unvetted and unevaluated make for bad governance...do you suupose they're trying to appease too many special interests?
of course CM Wonsley wants to add to the budget for her Municipal Grocery store idea and a handful of other ideas (some of which might be helpful for city residents). but if each council member adds half a dozen additional expenses.... well I do not need to be an accountant to know you cannot just add expenditures. We see how that played out last year with each person having their own agenda and their own fiefdom on the council. If an additional 70 things get added to this.. Yikes!
IMO clearly some expenditures need to be SUBTRACTED from the budget.
Thanks for the excellent perspective. How can we impact this beast, which will continue to need ever greater taxes? Certainly the DSA majority cares nothing about homeowner property tax issues, and the budget apparently has Frey approval. Is there a meaningful way to oppose excessive spending?
I believe your final chance is Dec 9 6pm when public comments are accepted on the budget. Also worth emailing your CM.
“…the city is reducing staffing from 2.3 FTEs to 1.4 FTEs.”
If I tried budgeting for fractional employees in Corporate America, I would be drawn and quartered. Where is @Jim Meyer when we need him?!?
See my previous comment. It's very common in the private sector to have jobs that are less than full time, and other jobs that are allocated across projects or departments. It is a best practice to measure these accurately.
You’re technically right, David, but it hinges on the context. When justifying capital projects, for example, it’s generally considered a major faux pas to claim a labor reduction of 0.27 people. The reality is that it’s difficult to save headcount that way. You either eliminate a full body or you’re not allowed to make the claim in your justification. I’m not inclined to give our politicians benefit of the doubt based on the other shenanigans they have proposed, such as city-owned grocery stores and city-wide sidewalk snow removal. They seem incapable of seeing the big picture or performing even simple math.
Mike, I can very readily agree with your last two sentences.
As to the FTE accounting aspects, I'm sure different organizations and different CFOs have varying views on these matters. My own many years in a fairly capital-intensive medical organization (where I was the CFO a couple of times though mostly my responsibilities were elsewhere) was to be precise in FTE estimates as in all else. If a piece of lab equipment would replace two full-time employees on the evening shift and a half-time employee on the overnight shift, our justification claimed 2.5 FTEs. And we enforced the claimed reductions, the lab director could not say oops, I need some of this back.
This is minor in the scheme of things and hard to say there's one definite right answer. However, I think we would agree that in building and executing budgets in a large, complex organization, what is truly important is accountability.
No member of our current city council majority has ever held a high, responsible position in any large, complex organization. Big picture, simple math, all outside their realm of experience.
Yeah, I recognize different organizations will do it differently. But in competitive environments, effective organizations have no choice but to manage finances tightly. My background comes from capital project management in food processing. Like your experience, our labor-saving claims were enforced after project implementation. But senior management was also highly skeptical of fractional FTEs, because in 24/7 continuous operations, there were very few instances where we could actually eliminate a portion of a position. Even if a worker ended up with spare time to do other things, we couldn’t claim that unless we could eliminate their position altogether. Part time workers were extremely uncommon.
But both of our comments are nuance. To your point, most of our council members have zero experience to even have this discussion. Cannot be trusted to manage anything more than their household budget. If that.
Good summary. It seems crazy to me that the budget is increasing at the same time that the homeowners' tax bill is going up due to declining commercial property value. Even if the 2026 budget were the same as 2025, our property taxes would still go up due to declining commercial property values. In a political moment when affordability is the buzzword, one of the few things the City can control (its budget) is going out of control.
I, too, am concerned about the City's outsourcing. I have no reason to believe that they could do it better/cheaper in-house. The key, as you say, is ensuring the City is highly skilled in contractor management.
https://minneapolistimes.com/2025-budget-city-councils-values-display/
This Mpls Time's piece from Dec 2024 was stunning to me. While we suspected that most of our council members knew absolutely nothing about money, or ANYTHING related to budgets and being fiscally responsible, and they didn't seem to be in the business of learning anything either, one thing that they did KNOW, ( which surprised no one) was how to USE the budgeting process/and other people's money, to help themselves. How did that work out for them, well sadly, pretty well, since the majority of that DSA aligned voting block got re elected.
Excerpts from the piece..
"Much of this is being done to curry favor before an election year."
"By far the biggest number of proposals are what I like to think of as “Giving money to your friends.” 33 proposals, about half, were to give money to non-profits. Money for the Latino Business Week and Trans Summit and façade improvements on Bloomington Avenue and Mercado Central and the Indigenous Wealth Building Center. The biggest, $1 million was for building improvements for unnamed non-profits in North Minneapolis. The list goes on. Hundreds of thousands of dollars to non-profit “safety” programs, with only vague explanations of what will actually be done. $25,000 for stipends for people serving on the Safe and Thriving Communities Work Group, essentially paying anti-police activists. $500,000 to a group to tell us how we can stop producing garbage. $50,000 to a group to tell us how to implement free phone charging stations. Much of this is being done to curry favor before an election year.
Another big group of proposals is the “Duplicating what other government is already doing.."
From All of Mpls...
Happy Thanksgiving weekend.
We are incredibly thankful for all of the efforts that made the 2025 Municipal election such a success for Minneapolis. Unfortunately, the City Council majority that voters just showed the door is going out with a vindictive, immature parting shot at our newly re-elected Mayor.
Instead of helping our city move forward, the outgoing City council majority is spending its final weeks pushing a grab-bag of unreasonable budget amendments in a last gasp attempt to either push their own far-left agenda or to punish their political opponents, particularly Mayor Frey. One of the proposed amendments reduces the Mayor’s office budget by such an absurd amount that it would result in a mayoral office with no staff.
According to the Star Tribune, “(Mayor) Frey also proposes reducing his office budget by nearly $23,000, but some council members want to cut much deeper to help fund their initiatives. Taken together, several of their amendments would mean about $1.2 million in cuts to Frey’s budget of $2.7 million. That would require firing most of his 15 staffers.”
This is exactly the kind of petty, destructive behavior that Minneapolis voters just rejected in the last election.
Fortunately, there is some good news. Four new council members — three of whom All of Mpls was proud to endorse — will take office in January. We believe these new members, along with a number of re-elected members, will finally turn the page on the chaos of the last few years and focus on stability, collaboration, and results.
Please stay posted for updates on key budget decisions in the coming days. Meanwhile, thank you again for everything you did to help deliver much needed change to our city government. Minneapolis is on a better path because of you.
All the best,
Karin Birkeland
Chair, All of Mpls
The unfortunate part of all of this is, we will still have a sizable group of these same folks on the City Council after Jan. Due to some significant lapses in their personal and professional development, they cannot know that there will be no movement, NO place for them outside of the hate a mayor/ hate a cop, DSA world...so all of their potential political endeavors will be quite limited, IF they exist at all. In the meantime, we will keep paying them, and find any and all ways to step over and around them.
Terry, that I'm looking at this stuff on Thanksgiving morning might place me even higher than you on the Nerd Index. But I do have a couple of questions about your budget analysis. And I fully understand you haven't spent "dozens" of hours, nor have I.
But I do wonder if you are treating the capital equipment item correctly. It sounds like this is part of the capital budget, which, through borrowing, spreads the cost of capital investments over years and decades. The true impact on any year's budget would be the debt service, which is already baked in; the debt service on the new spending of $89 million in 2026 would be a small fraction of that figure.
Also, maybe it's 'cuz I am indeed cursed with an MBA, but I much more readily accept accounting for FTEs in fractions. In large organizations, many people work other than full time, and many others have jobs that are allocated to more than one function or department. We really do want to account for people-costs accurately, and that means fractions.
Given the holiday, we can be thankful for you, Carol Becker, and Steve Brandt, all of whom really do dig into "boring" budget documents.