State Auditor Blaha Releases 2022 City Finances Report - June 6, 2024

Saint Paul, MN – “City revenues and expenditures bounced back in 2022 after decreases in 2021,” said Auditor Blaha.

The 2022 City Finances Report was compiled from city reporting forms, financial statements, and audits. The Report summarizes the current and long-term trends for city revenues, expenditures, and debt.

“In 2022, cities are seeing the beginning of pandemic recovery,” added Blaha. “Although federal aid continued to be historically high, significant revenue rebounds were led by hotel/motel taxes, local sales taxes, and charges for services.”

Highlights of the report include:

• Total revenues of the governmental funds for all Minnesota cities totaled $6.9 billion in 2022, an increase of 6.5 percent over 2021 revenues. Total revenues of cities over 2,500 in population increased 6.5 percent, while revenues of cities under 2,500 in population increased 6.4 percent over the two-year period.
• In 2022, total expenditures of the governmental funds for all cities totaled $7.7 billion. This represents an increase of 7.8 percent from 2021. Total expenditures for cities over 2,500 in population increased 8.4 percent, while those under 2,500 in population increased 1.9 percent in 2022.
• Over the ten-year period of 2013 to 2022, actual revenues derived from property taxes grew 52.8 percent, compared to an increase of 67.0 percent for revenues derived from intergovernmental sources. Federal grants increased 163.7 percent, state grants increased 46.0 percent, and local grants increased 36.0 percent. 
• When adjusted for inflation, total revenues increased 9.6 percent. Also, four of the revenue categories showed a decrease: Interest earnings (-498.1 percent), fines and forfeits (-47.8 percent), special assessments (38.0 percent), and all other revenues (-20.6 percent).
• Between 2013 and 2022, an examination of city finances shows that, when adjusted for inflation, expenditures increased 10.1 percent over the ten-year period.
• The three components of city spending are total current expenditures, total capital outlays, and total debt service. Over the ten-year period, when adjusted for inflation, total current expenditures increased 9.2 percent, capital outlays increased 27.7 percent, and debt service decreased 11.5 percent.

You may view the complete report on the OSA website.