[Mpls] MPLStown's Debt

[Scott McGerik]

Allen Graetz wrote:

> Is there any talk of Minneapolis changing it's city charter to require 
> the council to keep the city's budget balanced over a year or two year 
> period of time?  I'm curious.  This seems to be the only way of 
> preventing politicians from passing the problem on to the next people 
> coming into office or even the next generation.

I see as more useful is changing the city charter to limit increases in 
spending. It is spending that leads taxes and debt. Debt is merely taxes 
deferred until later. To limit the increase in taxes and debt, we need to 
put a limit on how much the City Council can increase spending.

If this charter change is modeled after TABOR laws passed in other states, 
any any new tax, tax rate increase, extension of a tax due to expire, most 
new debt obligations, or tax policy changes causing a net revenue gain 
would require voter approval. Thus, if the City Council believed that the 
City was facing a financial emergency, it could approach the citizens of 
the City to ask for permission to raise taxes, etc. But it would have to 
have a good argument as to why the tax increase was justified.

By requiring the City Council to approach the citizens for any tax 
increase, we would make the City Council more accountable to us. I don't 
see the City Council as being all that accountable when they only face 
election every four years. Four years is a long time in which to lose 
touch with your constituents.


The Taxpayers League of Minnesota has information regarding a Taxpayers 
Bill of Rights (TABOR), which would limit spending increases at the state 
level, at http://www.taxpayersleague.org/issues/billofrights.php. It is 
from this that I got the idea of limiting city expenditure growth via the 
city charter.

Michael New, in Proposition 13 and State Budget Limitations Past Successes 
and Future Options at http://www.cato.org/pubs/briefs/bp83.pdf discusses 
the effectiveness of TABOR-like laws.

Further information about TABOR laws can be found at 
http://www.americansforprosperity.org/.


Scott McGerik
South St Paul (formerly of Hawthorne)
http://scott.mcgerik.com/