Last week, we published a story in which Minneapolis city officials talked about how well the city finances stacked up during the current recession, because Minneapolis did not have major stock market holdings. This week, Mayor R.T. Rybak and City Council President Barbara Johnson proposed a hiring freeze because of — you guessed it — stock market losses.
From last week’s article:
“I would say that [Minneapolis is] doing relatively better than our big city counterparts around the country,” said Patrick Born, Minneapolis city finance officer.
This is because the city has not made investments in the stock market. The only exceptions to this are some pension plans that belong to fire or police officers who began working for the city before 1980, Born said.
Today’s official statement on from the city of Minneapolis painted a different picture:
The City’s finance staff estimate that the City already faces about $38 million in additional costs related to employee pensions over the next five years due to stock market losses.
The City Council is expected to vote on the recommendation on December 12.