>> LEADERS IN ST.

PAUL ARE WORKING ON NEXT YEAR'S BUDGET, AND OFFICIALS FACE A HISTORIC CHALLENGE: A $26 MILLION FUNDING GAP, LIKELY THE BIGGEST ON RECORD FOR THE CAPITAL CITY.

WHAT WILL THIS MEAN FOR CORE CITY SERVICES, EFFORTS TO REVITALIZE DOWNTOWN, AND THE EXPERIMENTAL SOCIAL PROGRAMS INTRODUCED BY THE PREVIOUS MAYOR?

IN TIMES LIKE THIS, WE LOOK TO ST.

PAUL "PIONEER PRESS" REPORTER FRED MELO.

WELCOME BACK.

>> THAT'S A REALLY KIND INTRODUCTION.

THANK YOU.

>> Eric: WELL, YOU EARNED IT.

>> APPRECIATE IT.

>> Eric: NOW THE AYOR AND THE COUNCIL RESIDENT ARE SAYING THAT WE'RE GOING TO OPEN THREE KYWAYS.

>> THERE'S AN EFFORT.

THE MAYOR'S OFFICE IS DOING THE BEST THEY CAN.

BUT YEAH, THERE'S BEEN SOME HOLES IN THE SKYWAY SYSTEM WHICH IS A BIG PART OF WHY PEOPLE MOVE TO DOWNTOWN ST.

PAUL.

>> Eric: WHAT'S CAUSED THE SHORTFALL?

>> THE 26 MILLION, SO EVERY YEAR -- BECAUSE OF INFLATION, BECAUSE OF LABOR COSTS GOING UP, JUST THE COST OF FILLING POT HOLES, THERE'S A GULF BETWEEN THE REVENUE YOU EXPECT TO COME IN AND THEN KIND OF WHAT ALL OF THAT COSTS.

THE GULF IS NOTHING NEW.

BUT EVEN ADJUSTING FOR INFLATION, 26 MILLION IS ESPECIALLY HIGH.

I THINK INFLATION IS A IG PART OF THAT.

BUT THERE'S ALSO A LOT OF THE STUFF THE CITY DOES.

WE HAVE MORE PARKS THAN ANY CITY OTHER THAN WASHINGTON, D.C.

SO THE MAYOR SAYS EVERYTHING'S ON THE TABLE.

SHE HASN'T RULED OUT ANY CUT OR REDUCTION.

I SAID, HEY, COULD YOU LET SOME STAFF GO, LET PROGRAMS GO?

SHE JUST KEPT SAYING EVERYTHING'S ON THE TABLE.

>> Cathy: HOW ABOUT REVENUE STREAMS?

>> THERE IS THIS HALF-CENT: WE ADDED A ONE-CENT SALES TAX ON TOP OF THAT FOR THINGS LIKE ROADS AND PARKS.

SO AS SALES GOES P, AND THEY DO BECAUSE OF INFLATION, SO THINGS ARE MORE EXPENSIVE, YOU GET MORE SALES TAX ROM THAT.

SO THAT'LL ADD A COUPLE MILLION, MAYBE AN VEN EXTRA 4 MILLION.

SO THAT'LL BUMP THAT 26 NUMBER DOWN.

BUT THE BIGGEST DRIVER IS REALLY PROPERTY TAXES.

THAT'S REALLY WHAT -- UNLESS THE STATE SAYS, HERE'S A BUNCH OF MONEY -- >> Cathy: AND THEY'RE ALREADY HIGH IN ST.

PAUL.

>> THE TAXES ARE VERY HIGH IN ST.

PAUL.

I DON'T THINK ANYONE'S DISAGREEING WITH THAT.

>> Cathy: HEY, I'M WONDERING, DID FORMER MAYOR CARTER LEAVE A MESS FOR MAYOR HER.

DID SHE KNOW WHAT SHE WAS GETTING INTO WHEN SHE GOT INTO OFFICE?

OFFICE?

>> THAT'S A GOOD OFFICE.

HE WOULD NOT CALL IT A MESS.

IT'S A LOT OF MONEY.

I THINK SHE CAME IN EYES WIDE OPEN AS A STATE REPRESENTATIVE.

THE CITY REPRESENTATIVES, THE LOBBYISTS, YOU KNOW, THEY WERE CONSTANTLY ARE UP AT THE STATE CAPITOL SAYING STATE AID HAS NOT INCREASED WITH INFLATION.

IF IT HAD, IF IT HAD JUST KIND OF KEPT PACE, WE'VE BEEN GETTING TENS OF MILLIONS DOLLARS MORE.

SO I THINK SHE WAS AWARE OF SOME OF THAT.

BUT, YEAH, THIS IS A MAYBE A LITTLE SURPRISE.

>> Eric: THE COUNCIL HAS BEEN PROPOSING 40% INCREASE IN PAY FOR CITY COUNCIL MEMBERS.

THEY MUST HAVE KNOWN THE SALARY WHEN THEY -- >> YEAH, I MEAN, THEY MAKE $79,000.

IT'S A PART-TIME JOB OFFICIALLY.

A LOT OF PEOPLE DON'T KNOW THAT.

THEY HAVE OUTSIDE EMPLOYMENT.

AND THIS COUNCIL MORE SO THAN IN PREVIOUS COUNCILS, YOU HAVE A COUPLE PEOPLE WHO RUN NON-PROFITS.

ONE'S A CIVIL ENGINEER.

THIS COUNCIL'S REALLY BUSY OUTSIDE OF COUNCIL HOURS.

DURING OPERATION METRO SURGE, THE PANDEMIC, ALL THESE BIG ISSUES, IT'S NOT REALLY WORKING THAT WELL.

I THINK EVERYONE CKNOWLEDGES THAT.

IS BUMPING THEIR SALARY TO $112,000 FIX THAT THERE'S A LOT OF QUESTIONS THERE.

>> Cathy: OW LIKELY WOULD IT BE THAT THE T. PAUL CITY COUNCIL WOULD MOVE TO A FULL-TIME STATUS?

>> YEAH, I DON'T EVEN THINK THE NELSON YANG AS THE COUNCIL MEMBER PROPOSING IT, SHE DOESN'T WANT THE WORD "FULL-TIME IN THERE.

SO WE CAN KIND OF MAKE AND CHOOSE FOR OURSELVES OR OWN HOURS.

A LOT OF THIS IS GOING TO AVE TO GET SORTED OUT TO GET APPROVED BY VOTERS.

>> Eric: AND WHAT'S THE MECHANISM?

A BALLOT QUESTION?

>> A CITY CHARTER AMENDMENT HAS A COUPLE DIFFERENT STEPS.

THERE'S A CHARTER COMMISSION.

IF THE ENTIRE CITY COUNCIL IS UNANIMOUS, MAYBE THEY CAN AVOID BALLOT.

THERE'S SOME LEGALESE THERE.

>> Eric: WILL THERE BE A STATUE OF CRAIG LEOPOLD SOMEWHERE.

>> HE OWNS THE WILD, THEY JUST BOUGHT THE ST.

PAUL HOTEL.

THEY'RE RENOVATING THE ST.

PAUL HOTEL.

THERE'S SOME BIG THINGS HAPPENING IN ST.

PAUL.

SECURIAN JUST PUT $50 MILLION DOWNTOWN INTO A NEW GYM AND REFURBISHING SPACES.

JAZZ DPESES FESTIVAL WAS GREAT.

>> Cathy: YOU GOT SOME OTHER STUFF THAT'S KIND OF -- >> I'M TRYING TO PUT ALL THAT ASIDE.

I WROTE ABOUT THAT THIS WEEK.

TWIN CITIES.COM.

THERE'S ESCALATORS THAT JUST HAVE A BIG X IN FRONT OF THEM.

>> Eric: I WALKED BY PEDRO PARK.

IT'S GREAT!

>> LET'S BE POSITIV