Allen E. Hoppe, CFA, CTP,
Director - Banking, Investments and Debt
Today, Mayor Jacob Frey announced the creation of his Climate Legacy Initiative (CLI), a plan to fund the City of Minneapolis’ aggressive climate goals over the next 10 years, hoping to become one of the most sustainable cities in the nation. The CLI officially takes off after year-long conversations with community members, grassroots advocates, nonprofits, unions, utility companies, and business representatives.
The CLI is an innovative way to achieve the City’s accelerated, equitable climate action goals. Through the CLI, Mayor Frey is proposing adding an additional $8 to 10 million into climate action work each year, starting with the 2024 budget. This funding would triple the City’s investment in climate work and would be in addition to ongoing climate funding and any other new climate funding proposed in next year’s budget.
“One-third of Americans currently live under extreme heat advisories which means there is no time to waste when it comes to advancing our climate goals,” said Mayor Jacob Frey. “This must be an all-in effort to reach our renewable energy goals because lives depend on it. We must think of ourselves not only as the mayors, council members, and advocates of our residents today, but as the mayors, council members, and advocates of those that are not here yet. This is about our collective future, and about acting today to protect it.”
“The climate crisis is here, and it’s going to take all of us to address the harmful impacts,” said Majority Leader Jamie Long. “I’m thrilled to see Mayor Frey announce bold climate action and set ambitious goals just like the Minnesota Legislature did this year. The new state budget includes resources to make this plan a reality. When federal, state, and local leaders work together, big things are possible.”
This is a historic investment in the ongoing climate work at the City, and the critical CLI funding will be raised via gas and electric utility franchise fees. The last time the City increased these utility franchise fees was in 2017 with a $3 million increase. Today, the mayor announced his plan to increase the fees by $8 to 10 million each year, resulting in an average cost of just $8-12 per household, per year. This funding will go directly back to the ratepayers to lower energy bills, make energy efficiency improvements, and more.
The CLI will help provide the necessary funding to implement the City’s Climate Equity Plan, which provides a roadmap for climate work over the next decade. The community-wide plan sets a goal for Minneapolis to significantly reduce climate pollution by 2030 and become carbon neutral by 2050. It also includes plans to weatherize all homes, reduce utility bills, promote green job training, and plant more trees.
Complete funding for the CLI and Climate Equity Plan will come from a variety of sources, including federal IIJA and IRA funds, state dispersion of federal funds and 2023 legislation, utility conservation and renewable energy incentives, and city revenue tools.
The CLI will be authored by Council Member Lisa Goodman and Council Member Aisha Chughtai and co-authored by Council President Andrea Jenkins and Council Vice President Linea Palmisano.
“Addressing climate change is one of the most pressing issues of our time,” said Council President Andrea Jenkins. “It’s critical that we center the voices and needs of our Black communities and communities of color who experience the worst impacts of climate change and climate disaster. I look forward to working with all of our partners and impacted communities in meeting our shared sustainability goals.”
“We heard loud and clear that innovative actions are needed to combat our climate crisis and that a dedicated funding source would be needed to make those ideas a reality. That’s what the Climate Legacy Initiative is all about -- setting us up for equitable climate action work here in Minneapolis and to be a leader in the country on this work,” said Council Vice President Linea Palmisano. “What has been announced today is only a start. There will be a continuous process of creating new programming to meet our changing needs. I am particularly excited for the opportunities of workforce development and good jobs that this brings to our City. Our City staff has done a great job giving us the framework, now it’s up to us to make it happen.”
“The climate equity plan is a bold and forward-thinking response to climate change in our city,” said Council Member Lisa Goodman. “Now we need to fund programs to start the work of reducing the use of fossil gas, better insulating all housing, and incentivizing alternatives such as distributive solar. This action allows for a funding path to move forward, and I am proud to author an action that will start implementing the climate equity plan.”
The groups MN350, Unidos MN, ISAIAH, and SEIU – Local 26 said, "As a coalition we have stood up to demand action on climate change because we see the consequences of inaction every single day. Our members, especially communities of color, are already facing the impacts of the damage caused by big polluters who put their profits ahead of our health and the future of our planet. We still have a lot of work to do, but this funding is a good first step for the city of Minneapolis to be a leader in addressing climate change and making sure our city, state and country are leaders, co-governing with community, in protecting our planet for future generations."
“LIUNA members work hard every day to build and maintain our infrastructure and the electric and natural gas systems that power and heat homes and businesses across Minnesota, alongside brothers and sisters in other skilled trades,” said Kevin Pranis, Marketing Manager of LUINA Minnesota and North Dakota. “As the City of Minneapolis rolls out an ambitious action plan focused on climate equity, we appreciate the commitment of Mayor Frey and Council members to securing a just energy transition, and to maximizing opportunities to create family-supporting union jobs and career pathways. We look forward to collaborating with the City to deploy the innovative efficiency and energy technologies and environmental controls needed to clean our air and water and reduce our climate footprint.”
**Climate action at the City **
Over the past decade, the City has made extensive progress in addressing climate change and reducing greenhouse gas emissions. During Mayor Frey’s State of the City Address in April, he announced the City had already reached 100% of its renewable energy goals for city-owned buildings. Since 2018, the City has saved $120 million in energy costs through climate work, while supporting more than 3,7000 low-income residents and businesses.
The City also has several other initiatives in the works for the next two years to meet its renewable energy goals. These include:
