Whither NRP?

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January 27, 2003 // UPDATED 4:23 pm - April 27, 2007
By: David Brauer
David Brauer

City politicians, neighborhood activists tussle

Activists want the $11-million-per-year Neighborhood Revitalization Program preserved from budget cuts -- but three councilmembers say Downtown development subsidies would dry up if that happens.

As budget-cutting picks up speed at Minneapolis City Hall, some neighborhood activists are demanding that the Neighborhood Revitalization Program be spared the axe -- and some city officials are saying no.

Since its creation in 1990, NRP has been as close to motherhood and apple pie as you can get in Minneapolis. The program gives many neighborhoods -- and their politically active volunteers -- a chance to control $11 million to $20 million of annual local spending. The program literally buys representative neighborhood groups a place at the table with developers and even city agencies that need to complete projects. In 2001 Star Tribune poll, 77 percent of those contacted favored continuing the program versus 15 percent who said the money should be spent elsewhere.

However, on Jan. 10, the "Finance Work Group" -- Mayor R.T. Rybak and three councilmembers -- unveiled a resolution to close the five-year, $55 million projected city budget shortfall in part by canceling a $4 million annual Community Development levy. The levy was enacted one year ago to help fund NRP-type development after state tax cuts hurt NRP's financing.

Although no one yet knows how much NRP would be left with -- currently, it gets $11 million -- neighborhood groups would probably be left with millions less.

Work Group members say that while NRP is popular, police, fire and public works are higher-priority "core services." In tight times, even core services take a hit. In the Work Group plans, between 2004 and 2008, police spending growth will be trimmed by $12 million, fire by $2 million and public works by $8.4 million. (City managers will recommend specific program cuts later this year.)

Still, days after the council resolution was released, residents from 35 neighborhoods circulated their own resolution. They asked that the $4 million Community Development levy be preserved, and that the Council commit $11 million annually for NRP -- in other words, no NRP cut.

Despite NRP's cherished grassroots ethos, Work Group politicians are hanging tough. At an occasionally tense, impromptu Jan. 16 City Hall meeting with 30 activists, Rybak wouldn't lock in NRP's $11 million, saying, "I can't go all the way with this."

Downtown Councilmember Lisa Goodman (7th Ward), who supports the Work Group resolution, goes further. State property-tax cuts slashed NRP's dedicated revenues; new community development funds come from the property taxes that support police, fire and public works. "The money simply isn't there," she said.

If that's so, says Jeff Langaard, his neighborhood group might not be, either. "If [NRP] dollars are not available to the Whittier Alliance, by 2004, we'd have to shut the door," said Langaard, the group's executive director.

Development math

Rybak's staff insists that no one is talking about getting rid of NRP. "The resolution ... does not propose eliminating the NRP," wrote Deputy to the Mayor David Fey in an e-mail sent to activists Jan. 17. "The resolution doesn\'t address NRP at all, except to clarify that NRP funding is part of total community development funding. ... that can be supported within its property tax policy."

According to FinanceWork Group members -- Rybak, Council President Paul Ostrow (1st Ward), Council Ways and Means Chair Barb Johnson (4th Ward) and Southwest-area Councilmember Barret Lane (13th Ward) -- the city has about $33 million for community development. They say $22 million is tied up in restrictive federal grants that can't be controlled by neighborhoods through NRP.

The rest, $11 million, could fund activists' NRP demands. However, Work Group members say many other worthy community-development initiatives sip from the same pool.

Some of these initiatives are now funded with the $4 million Community Development levy. By killing the levy, the Work Group forces those projects to compete directly with NRP.

According to a written statement by Lane, Goodman and 11th Ward Councilmember Scott Benson (see following page), if NRP received the $11 million, the city would not be able to fund:

- Any downtown development;

- Commercial corridor development on avenues such as Franklin or Lake Street;

- Historic preservation projects;

- Re-opening Nicollet at Lake Street;

- Redeveloping Hi-Lake;

- Light-rail redevelopment.

Some Minneapolis Community Development Agency staff also are paid from the $11 million.

Activists remain skeptical, especially that the feds' $22 million can't stretch to cover community developments costs that might leave NRP fully funded. "Show us the strings," said Seward activist Scott Vreeland at the Jan. 16 meeting.

Rybak promised to get the information, still being researched at press time.

The politics of cutting

While organizers say the neighborhood resolution was hammered out among 100 activists, not all neighborhood leaders are going along. The Downtown Minneapolis Neighborhood Association considered the resolution Jan. 14, but after Goodman said approval would condone deeper cuts to police, fire and public works, DMNA's board rejected it 6-0 with one absention.

Meanwhile, at City Hall, Finance Work Groups were having a tough time passing their resolution. They couldn't muster a Council majority on Jan. 17, its scheduled voting day. With the 3rd Ward seat vacant, the 12-member council split 6-6. Councilmembers will lobby each other for two weeks then try to approve some budget reduction plan Friday, Jan. 31.

Holdouts have a variety of reasons, said Council Vice President Robert Lilligren (8th Ward). He is concerned that the process has moved too fast -- the resolution was scheduled to be approved a week after it was unveiled -- and that cuts to the Health Department wastoo high.

Meanwhile, 10th Ward Councilmember Dan Niziolek complained the "top priority" -- police -- wound up with smaller percentage increases than departments such as the mayor's office or council (see chart, below). Work Group supporters say because police account for $99 million of the $306 million in property-tax-supported services, they must find millions there.

Rybak has acknowledged there is not enough community-development money in the plan, but had no plan to increase it.

Councilmember Gary Schiff (9th Ward) has some ideas. Schiff has suggested lengthening certain city debt repayments -- already stretched from five to seven years in the Work Group resolution -- to as long as 10 years, with the up-front savings diverted to community development and conceivably NRP. His other funding idea: increase the 8 percent annual property-tax levy cap to, say, 8 1/2 percent.

Finance Work Group members Rybak and Lane find those ideas abhorrent. Lane notes that an 8 percent annual tax hike is already "aggressive." For homeowners, property taxes go up faster than that -- 13 percent -- because the state is also shifting the burden from commercial properties. Therefore, homeowners could see city taxes double in less than six years.

Said Rybak, "More than 8 percent is absolutely off the table. I will not leave the city in debt, and I won't tax people out of their houses."

Rybak and other Finance Work Group supporters maintain that less NRP cash does not translate into less neighborhood power. They insist that because the city's development process is being streamlined, neighborhood residents will have a broader say in more city spending decisions.

Many activists at the Jan. 16 meeting seemed skeptical. Some recalled battles with intransigent city staffers won only because of NRP money. Said one, "When we control the money, they have to come to us."

Rybak said NRP director Bob Miller is working on a proposal for NRP's future. Miller said such a plan will have to wait until city leaders decide how much money they want to spend.