Minneapolis finds positives in different kind of session

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June 7, 2010
By: Cristof Traudes
Cristof Traudes
// LGA again induced pain, but several not-so-sexy items made up for it //

Taking a step back after a wild five months, Gene Ranieri, Minneapolis’ director of intergovernmental relations, took stock of another completed legislative session.

“I always tell my wife, every session has a different personality,” he said.

This year’s suffered from schizophrenia.

From a big-picture perspective, it was a session split in two. Part one was fast, focused largely on bonding, budget aids and credits. That was done by April. Then there was a long pause and then a stern decision from the state Supreme Court that threatened to recreate a $2.7 billion budget deficit Gov. Tim Pawlenty last year illegally tried to patch on his own. Ultimately, legislators only needed a few extra hours of session to get all of the state’s ducks in a row, but even then, they’re looking at as much as a $6 billion structural budget deficit for the next biennium.

“Unusual,” government relations representative Pierre Willette called the session.

Still, Minneapolis leaders are feeling upbeat. That’s because beneath the despair of financial issues, they’re finding accomplishments among new state policies and bonding appropriations. In particular, a major pension shift will keep one of the city’s closed pension funds from falling into insolvency, while several changes in areas such as transportation and domestic violence prevention should boost initiatives that began inside Minneapolis borders.

Little of it is “sexy,” said City Council Member Elizabeth Glidden (8th Ward), who is in her first year as chairwoman of Intergovernmental Relations. But with only measured expectations heading into the session, the city should celebrate what was accomplished, she said.

“Not too shabby,” Glidden called it.

Here are some highlights:

A little less pension pain

Goodbye, Minneapolis Employees Retirement Fund (MERF). Hello, Public Employees Retirement Association of Minnesota (PERA).

Pawlenty signed into law a bill that will allow one of the city’s three closed pension funds to merge with a state fund, preventing the former from hitting insolvency and its members from ending up with no more income.

MERF, which applies to a swath of city employees hired before 1978, pays out about $150 million per year. But because of the economy, it reportedly had only about $800 million in assets as of last year, and fund leadership said it saw money running out within five to eight years.

“You could see the numbers,” Glidden said.

The legislative changes prevent the worst, but they do mean sacrifices from all angles. Starting in 2012, the state’s annual contribution will increase to $24 million — up $15 million — while the city’s contribution will jump to as much as $23 million, up from $4 million. Although acknowledging the steepness of the increase, the City Council has been budgeting for the change. Plus, not merging MERF with PERA could have had an equally costly outcome if beneficiaries had decided to sue.

“It was not just about numbers crunching,” Glidden said. “It was about lives.”

LGA gets cut, but in a best-case way

At one point, Minneapolis was certified to receive $90.3 million in local-government aid this year. Now it’s expecting no more than $58 million.

Still, Glidden said it didn’t feel as bad as it could have, especially because Pawlenty had proposed cutting it even further. That makes the final number, in an odd way, a best-case scenario, she said.

She also said the city likely will begin to rethink how LGA is used in its own budget. Rather than the fixed, steady resource it once was considered to be, it now acts more like a yoyo. As a result, pivotal city functions probably shouldn’t rely on it so much anymore, she said.

Orchestra Hall, Peavey get help

Although it will only cover about a quarter of the renovation of Orchestra Hall and neighboring Peavey Plaza, this year’s bonding bill is helping the project get off the ground. And it’s not like $16 million ever is an amount to scoff at.

The $44 million project promises to make big changes at the 11th Street and Nicollet Mall structure, but the city is most interested in what will happen to Peavey. Of the $16 million state appropriation, about $2 million will go toward plaza upgrades. The city is hoping to rejuvenate the space and make it more of a stand-alone destination.

Good for health

Another bonding success story is a $5 million grant to Hennepin County Medical Center and its hyperbaric chamber. The unique facility is the only one of its kind in the region and is used largely for treatment of carbon monoxide poisoning. But it also is found to have positive effects on healing some injuries, and a recent study showed the chamber also could benefit people who with traumatic brain injuries. The 50-year-old facility is eyeing a $10 million renovation.

Less success for Sculpture Garden

Despite support from majorities in both the House of Representatives and Senate, a $2 million grant for the Minneapolis Sculpture Garden didn’t make it past Pawlenty. The money would have been used for a number of upgrades that Walker Art Center and Minneapolis Park and Recreation Board representatives said are essential to keeping the garden around another two decades.

Growth for the parks system

Legislators voted to allow the Park Board to use money commonly designated for parks and trails for the purchase of a 14-acre site along the Mississippi River. Commissioners subsequently voted 9–0 to give the deal a green light.

Long owned and operated by lumber company Scherer Bros., the industrial site could someday be a destination park for Northeast, commissioners have said. It borders Boom Island and B.F. Nelson Park.

Business angels set for credits

People who invest in new Minnesota small businesses could be eligible for 25 percent refundable credits. The so-called angel investment program applies to supporters of businesses that are certified by the state Department of Employment and Economic Development, are headquartered in Minnesota and are involved in fields such as manufacturing, technology and research and development. More than $2.5 million is set aside for credits in 2010, with $5 million for 2011–2015.

Think twice before entering intersections

Heads up to drivers: We all might always be in a hurry during rush hour, but it now is 100 percent illegal to get stuck in an intersection as a traffic light turns red. Known as “blocking the box,” the action has been labeled a petty misdemeanor.

Protection for pets

When courts issue orders for protection for victims of domestic abuse, they now also are able to include directions for caring for their pets. According to studies, almost half of battered and abused women don’t leave their significant others or spouses out of fear for the safety of their animals.

Touchdown? No.

It wasn’t until the end of the session, but the Minnesota Vikings made a play for a new stadium with proposed legislation that all but guaranteed a Minneapolis site. The rub: Minneapolis leaders didn’t want it, largely because the proposal would have put a big tax burden on locals and taken away money currently used to pay for the Minneapolis Convention Center. Glidden referred to the bill as a proposal to steal from one of the city’s — and region’s — main economic drivers.

The bill was killed in the House of Representatives and never found a second hearing on the Senate side. However, the issue is expected to return in 2011.