St. Paul Mayor Kaohly Her proposes 6.8% property tax increase to make up for $26M city deficit
St. Paul Mayor Kaohly Her gave her inaugural budget address Thursday amid a firestorm of controversies in her first months on the job.
In order to bridge the gap of the city's $26 million budget shortfall, Her proposed raising property taxes by 6.8%. For the median-level homeowner, it amounts to $58 annually, she said.
In recent years, the city has faced "the strain of rising costs," stemming from inflation, the decline of commercial property values, tariffs and low revenue, according to Her. It has left an undue pressure on property taxes, but Her said she took a different approach on the budget and was able to keep costs below what was originally projected to be a double-digit increase.
The mayor herself will take a $20,000 pay cut, and she said her three highest-compensated staff members will forego their 2027 cost-of-living increase.
She added that she's also bringing the number of police officers on the city's force down from 616 to 605.
"My vision for our city is not built around shiny new objects but responsible, effective and equitable governments for a city well run," Her said.
Earlier this month Her faced pushback for her handling of the Pig's Eye Park homeless encampment, which housed upwards of 140 people. City staff cleared the encampment, though residents told WCCO it was a place they found community as they worked towards finding more stable housing.
Her defended the approach during the budget address, saying the issue "weighs heavily on my heart." But in order to properly address the issue of unsheltered homelessness in St. Paul, she said the city would have to spend hundreds of millions of dollars. To provide an estimated $120 million in services and housing to the Pig's Eye encampment residents alone, the city would need to raise property taxes by 50% on top of the 6.8% already proposed, she said.
"I do not believe this is a reasonable burden to place on St. Paul homeowners, renters or businesses," Her said.
Her encouraged residents to contact their city councilmember to weigh in on the proposed budget.
The mayor is also embroiled in sexual harassment allegations by the city's police chief and other employees. Her has said she is cooperating with the investigation and said in a statement that "some of my attempts at humor fell short of the standard I expect of myself."
During her address, Her emphasized responsible decision-making, while outlining several of her priorities for her next few years. She said she wants to make it easier to bring businesses to St. Paul, make city services accessible and enhance safety all while making sustainable fiscal choices.
"Looking ahead this budget is not the end of our work. It is the foundation for a stronger, more discipled approach to the city's finances and long-term planning," she said.
Minneapolis Mayor Jacob Frey unveiled his budget on Wednesday. The city is running on a $30 million deficit that stems from a massive police overtime payout and dropping revenue from downtown properties. Frey proposed a 11.3% increase on property taxes and 100 cuts to city government positions.
