When a coalition of child care and early learning advocates asked the St. Paul City Council to fund child care subsidies through public grants, the council opted to put a question on the 2024 ballot for voters to consider. Should the city raise property taxes each year for 10 years to help private providers serving low-income families?
Alarmed by the prospect of locking in a decade of sizable annual property tax increases, St. Paul Mayor Melvin Carter promptly vetoed the council decision, which had been approved 5-2. On Wednesday afternoon, minutes before the same majority vote of the seven-member council overrode his veto, Carter delivered an impassioned presentation against the ballot language inside his downtown offices at St. Paul City Hall.
“We still have yet to see a detailed plan or budget associated with this proposal,” Carter said, adding in an interview after the council vote: “It’s outstanding in the space of the detailed concerns I’ve given forward to override it without a single word why the numbers do work.”
If approved next year, a special levy would be structured to raise $2 million for child care subsidies in the first year, $4 million in the second year, $6 million in the third and so forth, reaching $20 million by year 10. That would raise property taxes for a median-value home by an estimated $16 in the first year and $160 by year 10.
Standing between two whiteboards, dry erase marker in hand, the mayor laid out how even at maximum funding, the money raised would fail to cover the size of a program that, as described in the ballot language, could easily reach $111 million or more before inflation.
Among his stated concerns, the mayor has said the proposed back-to-back property tax increases would fund a new, unproven program as large as the city’s police budget, without the staffing and infrastructure in place to manage it, and then lock in escalating property tax increases for 10 years. He raised the likelihood that even if approved by voters, the city might not implement it.
Proponents have said that the city has more than a year to figure out the details before the 2024 vote, and then several months after that to roll out the child care subsidy program. The gradual funding expansion would give the city time to work out issues, allowing enrollment to climb with time.
“We’ve asked and answered dozens of questions over how this program would work over the past seven years, and I look forward to asking and answering dozens more,” said Council Member Rebecca Noecker, a leading proponent of the subsidy initiative, during the council meeting.
Noecker noted that Denver, New Orleans and Dayton, Ohio, have all rolled out similar programs. “The mayor has known about this since 2017 when the work began,” she added later. “It’s frustrating to see that he’s chosen to really dig in on this (now) and take it to the white board instead of taking it to dialogue.”
The council then voted 5-2 to override the mayor’s veto, with Council Members Mitra Jalali and Russel Balenger voting against the override. “I don’t think this is the appropriate process,” said Jalali, who has called a 10-year rollout — with funding driven by city property taxes — unprecedented.
Balenger, in an interview, said many residents of his racially diverse, mixed-income ward — which spans Frogtown and Summit University — express concern to him about rising property taxes that do not appear to them to be commensurate with an increase in city services. “There would be a property tax going up for 10 years, and my constituents have been very clear that’s going to be a problem,” he said.
Council Member Jane Prince issued a written statement after the vote calling early learning investments “the most powerful economic development and workforce investment we can make as a city to prepare children to be successful” and affordable child care important “to give parents the peace of mind to succeed in our current workforce.”
Prince added: “Instead of vetoing five years of work by St. Paul community leaders — the Children’s Collaborative, (St. Paul Public Schools), Head Start, the City Council and hundreds of families across the city — it’s time that Mayor Carter engaged and listened and worked with us to help shape a plan he could support. That’s what real leadership looks like.”
Too much to take on?
Carter, in his veto letter, noted that the council resolution cites a need of $39 million per year to reach children 0-2 years old living at 185% of the federal poverty level and below, but it would provide only half of that amount ($20 million in year 10), “while committing the city to deliver at least seven major labor- and cost-intensive functions beyond that identified scope.”
The program, as outlined, would expand the reach to all children 0-5 years in the income range, subsidize families earning more than 185% of the federal poverty level on a sliding scale, establish and administer a community advisory committee, support providers to expand capacity and ensure competitive pay and benefits or access professional development opportunities, streamline the process of accessing care and applying for financial assistance, support providers in obtaining licensure and meeting program standards, and require evaluating performance metrics.
In short, it’s too much, Carter said.
“Clearly, if $39 million is the annual need to reach all children from birth to age 2, it is unreasonable to expect $20 million per year to accomplish that goal and seven other functions a decade from now,” said Carter, in his veto letter.
The mayor noted that he previously served as director of the Minnesota Office of Early Learning and executive director of the Minnesota Children’s Cabinet under former Gov. Mark Dayton, and as the previous Ward 1 city council member was a leading advocate for the St. Paul Promise Neighborhood, a child-centered district spanning the Summit University and Frogtown neighborhoods.
Some critics have said such a sweeping child care initiative would live better within the St. Paul Public Schools, subsidized by state and federal grants, or within Ramsey County Social Services. The city does not run a social services department of its own.
Pointing to the state’s “Feeding Our Future” scandal, in which nonprofit providers allegedly pocketed some $250 million or more for themselves instead of providing meals for poor children, others have questioned how the city will enforce oversight of the program given limited inspections staffing.
On Wednesday, Council Member Nelsie Yang appeared resolute. “Our city isn’t led by one person alone,” she said, referring to Carter. “We’re going to see this program through. We have a lot of work ahead of us.”