Facing “unprecedented budget challenges,” St. Paul Mayor Melvin Carter said the city plans to launch a guaranteed income pilot program.
A global pandemic combined with the “most destructive night in city history” has resulted in a $19.5 million budget deficit for 2021.
“Facing all of these crises at the same time has taken its toll on all of us, on every household, on every business, and every student, and on our city government too,” Carter said during his Thursday budget address.
St. Paul has seen 5,000 confirmed COVID-19 cases and 130 deaths, 70,000 unemployment claims since March, and the destruction of more than 300 businesses during one “horrible night” of rioting. The city’s response to the late May rioting has cost a total of $4 million thus far, Carter revealed.
He said he doesn’t want to simply pass the “pain forward to our residents and businesses in the form of a hefty property tax increase.” As such, his budget proposes no increase to the city’s property tax levy, intentionally avoids laying off city staff, and won’t tap into emergency reserves.
“The most important number in the budget that I’m proposing today is zero. To avoid adding financial pressure to the residents and businesses who are already struggling, my budget proposes zero increase to the city’s property tax levy,” said Carter.
He then announced that the city plans to launch a guaranteed income pilot program, which would draw from the $25 million in CARES Act funds St. Paul received.
“I imagine that many of you have also seen that I have signed on this summer as a founding member of a national organization called Mayors for a Guaranteed Income,” said Carter, who recently penned an op-ed in CNN defending the proposal.
“So with our COVID dollars and with funds that we have been able to raise through our Office of Financial Empowerment, we will be launching a guaranteed income demonstration pilot with the goal of helping even more low-income families in our community who need it right now more than ever,” he added.
The Star Tribune said the program would provide monthly payments of $500 over a period of 18 months to as many as 150 families, meaning the total cost would be about $1.3 million.
Carter said another $11 million of St. Paul’s CARES Act money will be used to help the city’s homeless population.