UPDATE, JUNE 9, 2020 - Based on questions asked by CM Angie Henderson and I at the June 8 Council budget work session, the Finance Department today provided additional clarification about what level of Funds Balance and Rainy Day Fund would trigger intervention by the State Comptroller. As a result of this clarification, the final Chair’s Substitute will NOT require any targeted savings for Metro departments or MNPS, and the Rainy Day Fund will be set at approximately $3.4 million. Here is the updated chart showing all the differences between what the Mayor proposed and the final substitute.

ORIGINAL POST, JUNE 8, 2020 - A few weeks ago, I narrowed my options for the “Chair’s Substitute Budget” to two — submit a substitute budget that kept the Mayor’s $1.00 rate increase with some different spending, or submit a substitute budget with a $1.066 total rate increase and does more to help people who need it the most. Here’s my May 27 post which described the options in detail.

I have chosen the $1.066 option. This will create a budget that is less than 0.8% larger than the Mayor’s proposed budget. For a $250,000 home, the proposed substitute is less than $3.50 per month more than what the Mayor proposed.

With input from the community, my Council colleagues, and especially the Council’s Minority Caucus, I believe that the extra 0.8% will accomplish a lot for people who will be most impacted by the needed rate increase.

If you want to go straight to some summary charts, here is a chart showing the differences between what the Mayor proposed and the final substitute. And here is a chart that adds in the original $1.066 proposal so you can see what has changed in the last few weeks.

The original $1.066 option for a substitute budget provided more money to schools, arts, summer youth employment, and non-profits. After hearing from the community last week, and after hearing from my Council colleagues at our work session last Thursday — especially the Minority Caucus, I went back and have tried to do better.

The biggest changes in the proposed substitute are in the category of community building. Using suggestions from the Council’s Minority Caucus, the proposed substitute adds full department-wide body camera implementation, a Chief Diversity Officer position, a Workforce Diversity Manager position, community centers being open on Saturday mornings, and a needed IT position to help the Clerk’s office for Judge Sheila Calloway’s important Juvenile Court work. The final substitute also holds the MNPD budget to FY 20 levels (where the Mayor’s budget calls for a $2.6 million increase over FY 20).

The proposed substitute also invests more in education. The substitute would offer MNPS approximately $12.5 million more, including $4.9 million to raise the minimum wage for over 1,500 employees to $15 per hour. The final substitute also does not require any “targeted savings” from MNPS.

You can see other changes to the final substitute on the charts I linked to earlier. As I have said, the goal from the start has been to help people who need it the most and who will be most impacted by the needed rate increase.

The final substitute will also add new requirements for the administration. The budget will require a transparent committee to be created for dealing with the $121 million in CARES Act relief funding that the city has already received. The substitute will also include a requirement for the Finance Director to present a written update of his FY 21 revenue projection to the Council no later than August 15.

By setting August 15 as the deadline for a revenue projection update, Metro can wait as long as possible before the October tax bills go out to learn about any changes to state or federal law and wait as long as possible for new data about tax revenue. Then, if there is a big change in the projections, the Council could decide to call special meetings in late August and change the tax rate if that’s what makes sense.

Before COVID-19 struck, I conducted community meetings about the budget all over the county. I have conducted online meetings about the budget. The Council had a record length public hearing. I have tried my best to take everything I have heard from constituents and colleagues since the beginning of the year and pull it together in a substitute budget that I hope will be supported by my colleagues.

Need more background? Check out my other budget posts:

Understanding the Mayor’s Proposed Budget

Exploring other options

Working on a substitute budget

Or type “budget” or “property tax” into the Search function of the blog to find posts from prior years.