On top of tax hikes, St. Paul Mayor Chris Coleman's 2012 budget proposal Monday mentioned "non-property tax revenue" - in other words, fee increases - to help make up for cuts to state aid and other fiscal pressures.

The proposed fee increases would add up to as much as $79 in new costs for the typical homeowner next year. That's nearly double the impact of Coleman's proposed 6.5 percent increase in the city's property tax levy.

It's not likely to be a popular idea at a time when many homeowners say they're hurting because of unemployment and the lingering effects of the recession. Nevertheless, snowplows need replacing, and employee health care costs are going up. Without funding, core services such as roadwork and public

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safety begin to falter. And city officials say they've kept spending relatively flat.

"Given all the challenges at the state Legislature and other things that are happening in the economy, this is a budget that is not without pain," city budget manager Steve Cordes told the St. Paul City Council on Wednesday, "but (it) is a fiscally prudent and forward-looking budget."

Residents owning homes valued at $155,000 today - the citywide median - would see their housing values drop 4 percent to $149,000 next year. Under the mayor's budget, those homeowners can expect to pay $1,235 in taxes and fees to St. Paul next year, compared with $1,110 this year.

The city's share of property taxes for those homeowners would go up $44, from $524 to

$568.

Water rates likely would rise from $204 to between $217 and $231.

A storm sewer charge would increase from $74 to $80. A sanitary sewer charge would go up $10.

And the city's recycling fee would increase from $32 to $54, with $18 of the $22 increase dedicated to curbside pickup of composting and clean organic materials. That program has been proposed by Eureka Recycling, the city's recycling contractor, but not finalized with St. Paul Public Works.

Some fees are specific to homes bordering particular types of street work. The typical street maintenance assessment - which applies to homes with street, sidewalk, streetlight maintenance and ash tree removal - would go up from $210 to $224.

City officials say homeowners and businesses won't be the only ones to foot the bill. The increased assessments apply to non-taxpaying properties such as colleges, nonprofits and tax-exempt businesses, as well.

Other increases are likely. For instance, all downtown parking meters could soon accept credit cards, an upgrade that could potentially be paid for by parking rate increases of 25 cents per hour.

The city council met Wednesday morning with Cordes to go over the mayor's proposal.

"The highlight of the budget is no

Mayor Chris Coleman spoke at the St. Paul Farmers Market where he launched a new initiative that utilizes bonding, state and federal funding and private partnerships to move forward with 15 economic development projects around Saint Paul. The development plan will leverage $100 million in private investment and create 3,000 new jobs, he said Wednesday August 18, 2010. (Chris Polydoroff) (Pioneer Press: Chris Polydoroff)
net growth in city government," said Cordes, noting spending would increase overall by about 0.3 percent. "It's basically a flat budget."

Spending won't increase significantly, but employee health care costs are going up, while state aid - so-called Local Government Aid and reimbursements for a state-funded housing tax credit - are going down. Local Government Aid in 2002 comprised 40 percent of the city budget; it will now be 23 percent of the budget.

Most city employees will receive no cost-of-living-adjustment increases in 2012, but $800,000 in annual step increases in union salaries will occur as scheduled. Overall salary expenditures would go down from $124.3 million to $122.4 million because of a reduction in personnel.

Employee benefit costs would still go up from $51.6 million to $52.5 million, largely because of $2 million in health care increases.

The city's total 2012 budget would be $493.1 million, up from $491.7 million in 2011. The 2012 general fund budget of about $229 million drops $1.5 million, down 0.65 percent from this year's general fund budget of about $230.6 million.

In all, 56 positions would be reduced under the proposal, largely through vacancies and attrition.

"Right now, it's estimated that the layoff number would be under 20. That's going to shift a lot in the next few months," Cordes said. "People find new jobs. People leave city employment. It shifts the whole mix, and people end up bumping around each time that happens."

The proposed changes include a reduction of four civilian employees between the police and fire departments and a reduction of $500,000 in overtime for the fire department. Animal Control would lose two workers. Council members expressed concern that the Department of Safety and Inspections has been understaffed and would remain so for the foreseeable future.

The city maintains a AAA bond rating with Standard & Poor's and Aa1+ with Moody's, two of the largest credit-rating agencies.

That's "better credit than the federal government," Cordes said.

The city council and mayor have until the end of the year to approve a 2012 budget.

The council's budget committee meets at 10 a.m. Wednesdays in Room 330 of City Hall.

Frederick Melo can be reached at 651-228-2172.