The StarTribune published some good news for Minneapolis residents. Low interest rates will allow City Hall to refinance some bonds and save $8 million.
"There is a big demand for municipal debt due to its perceived safety," said Michael Abeln, director of capital and debt management for the city of Minneapolis. "Because there is a lot of demand, the rates that we have to pay are dropped."
Bond investors trust City Hall to make good on its promises. That trust is well-founded. Our city has earned a great credit rating. But what about the promises City Hall makes to residents? What happens to that $8M—which was our money in the first place?
…Minneapolis will use its gains to reduce fees or to fund more infrastructure improvements, Abeln said.
"Debt is a cost to the taxpayer, either directly or indirectly. If this cost goes down it helps the taxpayer long-term," Abeln said.
"Does it mean we can lower the 2010 tax levy? No, it doesn't mean that. The ultimate outcome is the city is doing what it can to control the cost of providing services."
Generally, that sounds good. Be wary, though, of “infrastructure improvements”.
Does that mean more new downtown streets? Remember the City is considering abandoning the maintenance of concrete streets—which we have a lot of here in the First Ward. Does that mean nicer rail stops for suburbanites who contribute nothing to our neighborhoods? Does it mean more multi-million-dollar bike bridges for a handful of south side cyclists?
I say basics first. Let’s make sure we’re maintaining the infrastructure we have before we build new stuff. But if we need new cement for politicians to pose in front of, let’s pour it here in Northeast. How about a bike bridge over the tracks at 27th Ave NE? Or finally finishing the first paving of ALL our streets?
Hopefully, “reduce fees” means abandoning the silly streetlight fee. Streetlights are a core service, part of our shared infrastructure. Lights are something responsible government should provide out of our property taxes.
Also, note that reducing taxes with the $8M was immediately dismissed. Sometimes it seems that City Hall’s first priority is spending your money.