Nearly 100 mayors from across Minnesota have formally raised concerns about the state's fiscal direction, warning that policies enacted under Governor Tim Walz are placing growing financial strain on cities and local residents.
In a joint letter sent to Walz and state lawmakers, 98 mayors said they are increasingly alarmed by what they describe as fraud, excessive spending, and unfunded mandates at the state level. The mayors warned that these issues are undermining local budgets, limiting cities' ability to plan for the future, and potentially forcing higher property taxes or reduced services.
The letter points to what local leaders say is a rapid deterioration of Minnesota's financial position. After previously recording an estimated $18 billion budget surplus, the state is now projected to face a deficit of roughly $2.9 billion to $3 billion in the 2028-29 biennium. Mayors cited this reversal as evidence of poor fiscal management and said it has contributed to declining economic indicators, including weaker job growth, labor force participation, household income, and tax competitiveness.
Local officials also highlighted concerns about fraud within state-administered programs, arguing that insufficient oversight has allowed taxpayer funds to be misused. While the letter does not specify dollar amounts tied to fraud, the issue has drawn increased scrutiny in Minnesota amid broader investigations and reporting into misuse of public funds.
Another major concern outlined by the mayors involves unfunded state mandates. According to the letter, requirements imposed by the state -- including those related to public safety, education, and human services -- often shift costs to cities without providing adequate funding. Mayors warned that these expenses ultimately fall on residents and small businesses through higher local taxes or reduced municipal services.
Republican lawmakers at the state Capitol echoed the mayors' criticisms, placing responsibility on Walz and Democratic leadership. They argue that increased spending, tax hikes, and mandates enacted during the period of surplus have contributed to the current budget outlook and left local governments to absorb the financial impact.
As of publication, the Walz administration has not issued a public response to the letter. The governor has previously defended his administration's fiscal policies, citing broader economic conditions and competing budget priorities.
The mayors urged state leaders to adopt a more restrained and transparent fiscal approach, warning that failure to do so could further burden Minnesota residents and weaken local communities.