Coleman proposes tax hikes, layoffs, in St. Paul budget

St. Paul Mayor Chris Coleman is proposing a 6 percent property tax increase and employee layoffs across City Hall to make up for a nearly $12 million loss in state aid.

Coleman proposed the measures today in his annual budget address. But despite the cuts, St. Paul will expand its police force.

The DFL mayor was one of Republican Gov. Tim Pawlenty's most vocal critics following the governor's slashing of local government aid earlier this year. At the time, Coleman warned of dire consequences to cities, including possible cuts to police and fire.

But instead of pulling back on public safety, Coleman says St. Paul will hire 34 new police officers.

So, does this mean Coleman proved the governor was correct, by showing that cities could live within their means even after the state cuts?

"No, what it proves is that President Obama has protected us from the cuts that the governor put on cities across the state," said Coleman. "If it wasn't for the $6.1 million that President Obama has provided for the city of St. Paul, we wouldn't have been able to do what I just announced. So it's really the federal partnership that has allowed us to do that, in spite of what the state has done."

St. Paul received a total of $7.5 million in federal money to pay for the extra cops. In contrast, the state's largest city -- Minneapolis -- received less than half of that amount and will hire 13 new officers.

St. Paul also secured a federal grant to add more firefighters to its ranks.

But across the city, Coleman proposed trimming 120 positions, and said there could be as many as 45 layoffs early next year.

Coleman spoke to a mostly friendly audience at the former Galtier Plaza downtown -- now known as Cray Plaza, thanks to the supercomputer maker's plans to move into the high-rise tower in the fall.

The mayor highlighted a number of neighborhood investments, including a pledge to keep all libraries open and a new combined rec center and library on the city's east side.

Coleman also promised to work on finding money for parking solutions along University Ave. The mayor is a big backer of the planned Central Corridor light rail line that will link St. Paul and Minneapolis, despite the objections of small business owners who would lose much of their street parking to the transit project.

Still, next year's general budget, at $211 million, would be smaller than the current year's budget. Coleman's Republican Party-endorsed challenger, Eva Ng, was quick to point out his track record of championing levy hikes.

"We have experienced increases at 9 percent, 15 percent and another 9 percent. That averages out to 11 percent per year," said Ng. "That's a double-digit increases. Now, how many people have had double-digit increases in their salaries over the last three years?"

Ng and Coleman will square off in the mayor's race this fall. And while Coleman is considered a potential candidate for the governor's race next year, the mayor shrugged off all political speculation from reporters, and said he's focusing on what's best for his city.

Across the river, Minneapolis Mayor R.T. Rybak will deliver his budget address on Thursday. His city is facing a $21 million cut in state aid for next year.

On top of that, Rybak and the City Council will have to address an increase in pension obligations for two closed employee funds, which will cost the city an additional $18 million a year.

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