September 17, 2026
September means budget season at City Hall - and this year’s proposed budget is an especially tough one.
During her budget address in August, the Mayor proposed a 6.8% levy increase, which will amount to a tax increase of $58 for the average home. At a time when every expense from groceries to gas is skyrocketing, that increase will be felt, especially when it’s added to tax hikes from the County and school district.
For low-income residents, seniors on fixed incomes and young families dealing with the costs of housing and childcare, tax increases have become unsustainable and they are threatening our growth as people consider moving out of St. Paul.
At the same time, the Mayor’s budget cuts services - closing the Dayton’s Bluff Library, reducing hours at rec centers and eliminating the popular Commercial Corridors Program we created two years ago to support local businesses, diverting the funds to pay for renovations at the Grand Casino Arena.
To be fair, the Mayor is staring down a $26 million gap and making the best choices she can under conditions she doesn’t control.
But the gap is nothing new. Every year, we have the same challenge because every year, it costs more to do exactly the same thing. Gas, insurance, salaries and benefits all rise, often far outpacing inflation. To fill the gap, we need to raise taxes, cut services, or find efficiencies and new revenue sources - and there are a limited number of the latter.
What is new is the choice to balance the budget by cutting core services that matter to residents more than ever. As we’ve wrangled with significant budget gaps year over year, our Council has always prioritized those services - libraries, rec centers, parks, police and fire - that residents experience every day. Libraries and rec centers are particularly essential right now. As precious “third places” where people of all ages, backgrounds, and incomes can connect, they are the antidote to our society’s epidemic of loneliness and isolation, and they should be our last resort when trying to solve a budget gap.
We still have a long way to go before this budget is finalized. The Council will be digging into the details of each department’s proposal over the next few months and listening to your feedback. I hope you’ll consider tuning into our budget meetings (now streaming on YouTube!) or sharing your ideas at my community budget meeting on Tuesday, October 6 from 5:30-6:30 pm at Palace Recreation Center (781 Palace Avenue Saint Paul, MN 55102). I’m proud that over the last 10 years, our Council has regularly found ways to lower the Mayor’s proposed levy increase and restore cuts to key programs and I’m hopeful we can do the same this year.
But while we may be able to limit the damage this year, this budget should be a wake-up call. Local governments are increasingly being asked to handle our society’s most pressing problems - from climate change to homelessness, gun violence to opioid addiction - and we need creative, proactive approaches to make sure we’ll have the resources to address them.
First, we need a relentless focus on expanding our tax base. That means an all-out effort to attract jobs, development, and housing and get publicly owned land back on the tax rolls - especially downtown, where sagging commercial values are pushing the tax burden onto residential neighborhoods. For example, the RiversEdge and Central Station sites in downtown are two critical, high-value, publicly owned parcels that need to be developed with urgency. Bringing housing, retail and jobs to those sites would add multi-million-dollar properties to the tax rolls and make downtown more attractive to other residents, workers and investors.
Second, we need to explore a Payment In Lieu of Taxes (PILOT) program. With more than 20% of our land owned by tax-exempt organizations, like hospitals, colleges, and faith-based institutions, we need to ask these entities to help cover the cost of the services they use. A voluntary payment program would bring in much-needed revenue and create a fairer tax environment where everyone is helping shoulder the burden.
And finally, we need to demand the aid we are due from the state and federal governments. Cuts from the federal HR1 bill (which might be big but definitely isn’t beautiful) are creating a $6 million gap in Ramsey County’s budget in 2027 alone, and that gap will only grow in subsequent years if HR1 isn’t repealed or amended. Meanwhile, the state’s Local Government Aid (LGA) program, intended to compensate for cities’ systemic budget gaps, hasn’t kept pace with inflation. If it had, Saint Paul would be receiving $70 million more in LGA this year - completely eliminating our budget gap with plenty to spare.
Cities and counties are closest to the problems people are facing, which means we are uniquely positioned to come up with creative, forward-looking, and compassionate ways to address them. But we can’t do it on a shoestring budget and we can’t cut our way to growth. As local elected officials, we’ll make the best choices we can this year. And as people in a democracy, we need to insist that our federal and state partners do their part too.