Minneapolis budget pre-season underway with property taxes at play

The official kickoff of Minneapolis’ 2027 budget process may be weeks away, but public officials are already floating trial balloons and making ominous proclamations as Mayor Jacob Frey’s annual budget address draws near.

City staff shared with the City Council’s budget committee that the projected gap between revenue and expenses sits somewhere between $28-$32 million dollars. Council member Michael Rainville (Ward 3) is ringing alarm bells, saying a chasm that large could mean a 13% property tax increase.

The Minneapolis Parks and Recreation Board superintendent is looking for more money, too, saying at a July 22 meeting of the Board of Estimates and Taxation that the parks’ budget will need to increase by nearly 6% – even as additional revenue is sought elsewhere – to account for rising healthcare costs and a long-planned addition to the Northside’s North Commons Park. 

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The park board’s hoped-for budget exceeds $100 million. At the meeting, it was pointed out that its share of Minneapolis’ tax levy has trended downward over the past decade, from about 18.5% to nearer 17%.  

On July 28, parks board President Tom Olsen dryly asked his followers on social media: “Would you be a fan of cutting funding for Minneapolis parks to pay for Minneapolis police overtime?” (Sorry, no prizes for guessing the most popular answer.)

The rhetoric and the numbers will be flying fast and furious over the next five months – but if you want to try to pay attention to where the money – your tax dollars! – is going, here’s what to know.

Once Minneapolis’ current $2 billion budget was passed in December 2025, funded by a 7.8% property tax increase, city staff got right back to work to do it all over again, laying the groundwork for the upcoming budget season.

City departments have been formulating their individual budgets and capital improvement plans, including new hires or projects they’re pitching as must-do, or at least nice-to-have.

And more recently, Frey has been meeting with those department’s leaders, as well as other city staff, to try and formulate all those needs and wants into a single document.

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We’ll hear more about that in August, when Frey gives his ninth budget address as mayor – a roughly half-hour speech where he’ll shine a light on some additions to the budget, point out what’s getting cut and, homeowners hope, explain how the property tax levy increase isn’t going up quite as much as everyone might have thought.

It’s certainly what happened last year, when Frey touted city staff’s work in clawing an “unsustainable” 13% levy increase down to just under 8%. 

You might recognize 13% from a few paragraphs ago, as the number Rainville touted with great concern. It’s still not a number anyone’s going to want to see, and it may mean a repeat of some of Frey’s directives from last year, which included limiting new spending proposals and eliminating vacant positions.

But it’s the city’s Board of Estimate and Taxation that actually sets the maximum property tax levy each year, in September, after reviewing Frey’s budget and hearing from the public. The BET comprises the mayor, two Council members, the parks board president and two elected members.

Eric Bernstein, one of the elected members, told MinnPost that he’s hopeful that this year’s budget session will see significant checks on police spending. That follows heightened focus in recent months on the Minneapolis Police Department’s cost overruns due largely to additional overtime, an issue that arose late in the last budget season.

Bernstein said he felt the city and its officials had “enormous amounts of consensus” on the topic, which he hoped would ease concerns he had about what MPD’s overruns could mean for the levy.

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The Council will then hold multiple budget hearings, grilling department heads on their requests and hearing from the public. They’ll form amendments and make their final determinations as the budget nears its December adoption date.

Last year’s amendments took multiple days to discuss and vote on, and Frey called some of them targeting his office’s budget “mean-spirited and political.”

Once the 2027 budget is adopted, the whole process will start over for 2028 as city staff and officials try once again to roll the boulder up the hill.

For the current budget season, if you’re looking to stay informed, keep an eye not just on MinnPost but also Documenters, a community of residents trained to take notes at public meetings – like budget hearings – for publication on MinnPost’s website.

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