## City of Blaine ## City Council Workshop August 10, 2026 | 5:30 PM ## Blaine City Hall ## 10801 Town Square Drive NE ## Blaine, MN 55449 ## AGENDA ## NOTICE OF WORKSHOP MEETING In accordance with the provisions of Section 3.01 of the Blaine City Charter, a Council Workshop meeting is scheduled for the following purpose: 1. Call to Order ## 2. Roll Call ## 3. New Business ## 3.1. 2026-157 Conditional Use Permit (CUP) Discussion II (30 Minutes) ## Sponsors: Sheila Sellman, Community Development Director 3.2. 2026-158 2027 Budget - City & EDA Property Tax Levy (60 Minutes) ## Sponsors: Jason Zimmerman, Finance Director ## 4. Other Business 5. Adjournment Page 1 of 15 ## City of Blaine ## Staff Report ## File Number: 2026-157 ## Agenda Date ## Status August 10, 2026 ## In Control ## File Type ## City Council ## Workshop Item ## New Business - Sheila Sellman, Community Development Director Agenda Item # 3.1 ## Conditional Use Permit (CUP) Discussion II (30 Minutes) ## Background Conditional Use Permits (CUPs) are a common zoning application considered by the Planning Commission and City Council. When either approving or denying a conditional use permit, the City Council must make specific findings based on language in the zoning code. In the past several years, staff have recognized ambiguity in the existing code language and would like to discuss with council whether the language should be more direct. State Statute 462.3595 permits certain land uses as conditional uses under zoning regulations. To approve a CUP, the proposed use must meet the standards and criteria outlined in the local ordinance. Conditions may be attached to the CUP to address and mitigate potential concerns related to the proposed use or location. Section 101-4 of the Blaine Zoning code outlines the criteria, process and revocation of CUPs. Though Minnesota Statutes authorize the ability for cities to address CUPs, cities are allowed the ability to set their own criteria for considering CUP requests. Section 101-4 (a) lists the findings to approve a CUP as follows: (1) The use shall not create an excessive burden on existing parks, schools, streets and other public facilities and utilities which serve or are proposed to serve the area. (2) The use will be located, designed, maintained, and operated to be compatible with adjoining properties and the existing or intended character of the zoning district. (3) The use shall have an appearance that will not have an adverse effect upon adjacent properties. (4) The use, in the opinion of the City Council, shall be reasonably related to the overall needs of the City and to the existing land use. (5) The use shall be consistent with the purposes of the zoning code and purposes of the zoning district in which the applicant intends to locate the proposed use. (6) The use shall not be in conflict with the comprehensive plan of the City. (7) The use will not cause traffic hazard or congestion. (8) The use shall have adequate utilities, access roads, drainage and necessary facilities. Page 2 of 15 As mentioned, state statue does not provide the findings required in order to approve/deny a CUP. Each city adopts these findings through their zoning code. Staff proposes to revise the findings to enhance clarity and reduce subjectivity, making it easier to determine whether the use complies with the criteria. The proposed changes are below. Underlined is new language. (1) Public infrastructure and services. The use shall not create an excessive burden on Existing parks, schools, streets, and other public facilities and utilities which serve or are proposed to serve the area shall be able to absorb any additional demand created by the use. (2) Compatibility. The use will be located, designed, maintained, and operated to be compatible with adjoining properties. and the existing or intended character of the zoning district. (3)The use shall have an appearance that will not have an adverse effect upon adjacent properties. (3)(4) Health and safety. The proposed use shall not negatively impact the health, safety and general public welfare The use, in the opinion of the City Council, shall be reasonably related to the overall needs of the City and to the existing land use. (4)(5) Zoning. The use shall be consistent with the purposes of the zoning code and purposes of the zoning district in which the applicant intends to locate the proposed use. (5)(6) Consistency with the comprehensive plan. The use shall not be in conflict with the comprehensive plan of the City. (6)(7) Traffic. The use will not cause traffic hazard or congestion. The generation and characteristics of the traffic associated with the use and its impact on traffic volumes and safety associated with driveway locations, existing and proposed capacity on adjacent roads, sidewalks and trail connections can be adequately mitigated. (8) The use shall have adequate utilities, access roads, drainage and necessary facilities. ## Staff Recommendation Staff requests council to provide feedback on the proposed changes. ## Questions for Council 1. Does the City Council agree with the proposed changes to the findings? ## Attachment List ## None Page 3 of 15 ## City of Blaine ## Staff Report ## File Number: 2026-158 ## Agenda Date ## Status August 10, 2026 ## In Control ## File Type ## City Council ## Workshop Item ## New Business - Jason Zimmerman, Finance Director Agenda Item # 3.2 2027 Budget - City & EDA Property Tax Levy (60 Minutes) ## Background In accordance with the city's budget schedule, the August 10 Workshop was set aside for a presentation and discussion on the City Managers' recommended 2027 budget and property tax levy. With the feedback received during prior public meetings, the current proposal was developed with the intent of aligning City Council priorities with available financial resources to provide Blaine property owners, residents, and visitors with quality municipal services at a responsible tax level. Based on established guidance, staff have prioritized investments in capital assets that provide a broad benefit across the community, while minimizing additional ongoing operating requests. Because this document is being prepared in late July, many assumptions continue to be made based on trends in prior years' financial performance. Several factors may impact the final budget, including legislative changes, state mandates, economic shifts, and union negotiations. County-generated estimated market values for taxes payable in 2027 have yet to be provided, so at this time staff are unable to prepare an estimated tax capacity rate or impact scenario on the median valued single-family home. Additionally, metro-wide fiscal disparity information isn’t anticipated until sometime in late August, which staff also need to calculate an accurate estimate of tax rate/impact. ## Budget Preparation The budgetary process began with staff budget team conducting small group discussions with all members of the Council between March 31 and April 2 to provide measured assumptions that incorporated operating, capital, and debt funding strategies as outlined in previous budgetary cycles while maintaining existing staffing and service levels at anticipated 2027 costs. These conversations culminated in a set of Council-driven considerations and themes for the 2027 budget and property tax levy, which were reviewed and informally supported by the majority of the Council at the April 13 Workshop and are outlined below: Page 4 of 15 • Support for equitable staff compensation & professional development • Levy increases to support the reduction of debt; not new spending • Control costs through innovation & process improvement • Reduce reliance on the property tax levy • Leverage unrestricted reserves to fund nonrecurring items • Prioritize core municipal functions & customer service • Sustained investment in previously deferred infrastructure improvements • Consider future budgets and levies beyond 2027 • Continue periodic review of budget to actuals On April 27, City Manager Thorvig issued a memo to all budget contacts outlining the process, expectations, and strategic vision for the upcoming fiscal cycle. Following prior Council guidance, staff were directed to prioritize long-term investments in community-wide capital assets while minimizing requests for new, ongoing operating expenditures. This organizational approach was intended to ensure that early fiscal planning was focused on achieving outcomes that directly support Council direction and provide for an efficient budget process. The 2027 departmental requested budget scenario was then made available, requiring leadership to route all submissions through their respective department heads for approval by the May 15 deadline. Budget requests were evaluated, discussed, and further adjusted to ensure compliance with the direction provided by City Council and to maintain a consistent fiscal approach city-wide. At the June 8 Workshop, staff presented a revised 2027 city budget that would require a $59,500,000 tax levy, which represented a $5,270,000 or 9.7% increase from 2026. In an effort to conform with the specific actions outlined below, staff focused on reviewing historical spending and carefully checking all discretionary, or optional, costs. Feedback from Council was to continue refining the budget while considering historical fiscal performance and ensuring adequate resources to deliver city services at a responsible tax levy. Significant assumptions and factors impacting the baseline department requested 2027 city- based budget / property tax levy include: • Development of a metrically driven budget process and spending targets • Use of the Consumer Price Index (2.7%) for inflationary purposes • Flat travel & training budget; review of out-of-state policy • Two additional positions; elimination of one vacant position • New funding for contracted services to enhance the uses of public amenities • Additional resources for capital consistent with the CIP • Strategic use of unrestricted reserves for 2026 capital equipment • Bonding for 2026 pavement projects at current estimates ## City Manager Recommended Budget and Tax Levy While the responsibility of adopting the budget is that of the City Council, Blaine Charter Sec 7.05 specifies: "The city manager shall prepare the estimates for the annual budget of the general fund. Estimates may be prepared for other funds as deemed necessary by the city manager or the city council. The city manager shall submit with the estimate such explanatory statements as such manager may deem necessary". Providing the City Council, staff, and the public with a budget which provides the financial blueprint to carry out the city's strategic plan while outlining the true cost of delivering Page 5 of 15 municipal services is one of the core duties the city manager is expected to perform annually. Effectively managing the budgetary process is paramount for transparency, accountability, and successful financial governance. In response to the feedback received at the June 8 Workshop, the city manager requested a multi-layer approach to reduce the tax levy and impacts on property owners. The actions taken were done in an effort to secure sustainability in future budgets, ensuring that one-time funds were not used to supplant ongoing operating costs which would result in future budgets starting with unfunded deficits. Additionally, the modifications within this revised proposal were done based on the current economic conditions, with cross-departmental consideration for city initiatives, and not simply relying on the prior year's budget, also known as zero-based budgeting. Zero-Based Budgeting (ZBB) offers a rigorous, bottom-up financial methodology designed to enhance resource allocation and fiscal accountability. Unlike traditional incremental budgeting, which adjusts prior-year figures by a standard baseline, ZBB requires departments to justify all expenditures from the ground up for each fiscal cycle. By treating every line item as starting at zero, this approach eliminates routine complacency, replacing historical precedent with a mandatory evaluation of current operational necessity. The following adjustments have been made to the June 8 proposal in the development of the City Managers' current proposed budget/tax levy. 1. Line Item Budget Review: In a similar effort to the work that was completed for the 2026 budget, the City Manager conducted detailed budget meetings between June 22 and July 6 with each department, along with finance staff to review budget requests while comparing these inputs to historical results and the current 2026 budget as amended. This process identified opportunities to right-size budgets and further enhance the itemization and justification for each budget request, helping ensure service continuity and accountability. This represents a reduction from the 2.7% planned increase considered in previous levy proposals. Levy reduction = $135,162. 2. Alternative Funding: While initially considered to be paid for out of the General Fund budget after the initial 3-year term expired, the revised budget proposal continues to fund the annual license plate reader program through the Public Safety Aid Fund. Levy reduction = $100,000. 3. Staffing Adjustment: In the early planning stages, funding was outlined for the addition of two new full-time employees. Based on detailed discussions with individual departments and overall organizational consideration, the revised proposal has been modified to include only one new staff member within the police department. Levy reduction = $136,128. 4. Contracted Mowing: Staff had proposed an additional $85,000 for contracted mowing to restore service levels to select parks and reduce the volume of current no-mow areas within the city. Given the current condition of the parks capital improvement plan (CIP), $75,000 is recommended to be reallocated from the CIP and to the parks operating budget for these mowing services. Levy reduction = $85,000 The city managers' recommended budget includes a $59,070,000 tax levy, which represents an increase of $4,840,000 or 8.9% as outlined in the table below. This figure is $430,000 less than what was included in the June presentation, resulting in nearly a 1% reduction in the rate of levy increase. Page 6 of 15 ## City Levy History ## Levy Item 2022 Levy 2023 Levy 2024 Levy 2025 Levy 2026 Levy 2027 ## Department ## Requested ## Levy (June) 2027 City ## Manager ## Recommended ## Levy (August) Operating $29,350,000 $31,712,000 $36,385,585 $39,547,598 $43,239,487 $46,221,184 $45,863,458 Capital $450,000 $600,000 $200,000 $1,769,752 $3,165,360 $3,940,360 $3,865,360 Debt $4,800,000 $4,800,000 $6,324,015 $8,018,650 $7,825,153 $9,338,456 $9,341,182 Total $34,600,000 $37,112,000 $42,909,600 $49,336,000 $54,230,000 $59,500,000 $59,070,000 Within the City Managers' recommended budget and property tax levy is the recommendation to utilize unrestricted reserves that are in excess of the city's fund balance policy, which were through the city's long-standing tradition of budgetary performance over several years. Audited financial statements indicate approximately $5.2 million of unrestricted funds are available, which represents the fund balance in excess of the following policy requirements: • 25% or more of the succeeding year’s budgeted expenditures to fund cash flow needs • 5% of the current year’s gross property tax levy as a safeguard for property tax delinquencies • An amount equal to State funding commitments that are not constitutionally guaranteed by the ## State The adopted 2026 budget called for approximately $3.3 million of general capital equipment, with $2.3 million to be funded through equipment certificates, which is a form of debt. Consistent with the June 8 budget proposal, the City Manager is recommending utilizing unrestricted General Fund reserves to pay for these purchases in lieu of bonding. This recommendation is being made based on prior Council direction to reduce borrowing when possible and the use of these funds doesn't create additional spending, as these commitments were previously authorized. The appropriation of reserves for capital equipment would leave approximately $2.9 million of unrestricted funds available for other Council- approved uses. Maintaining an amount in excess of policy also demonstrates fiscal strength to financial statement users and serves as a crucial tool for managing risk. Depleting these funds could expose the city in the short term, as the Strategic Priorities Fund, which was established in part to navigate economic volatility, has no further fiscal capacity beyond the City's purchase agreement assignment and cost share for the proposed development at Lexington Crossings. ## Economic Development Authority Levy Acting as a separate taxing authority, the Economic Development Authority (EDA) is focused on achieving three key outcomes: economic growth, the creation of high-quality job opportunities, and the expansion of the commercial tax base. These efforts are essential for cultivating a vibrant business climate and enhancing the overall quality of life for all residents. Operating under Minnesota Statutes 469.033, the EDA is authorized to levy taxes to fund its operations and strategic initiatives. This special taxing district status empowers the city to make long-term investments in redevelopment and infrastructure. Page 7 of 15 Blaine created its Housing and Redevelopment Authority (HRA) in May 1985 to address the city’s housing and redevelopment needs. As a separate legal entity, the HRA led projects aimed at removing blight, such as deteriorated, vacant, or neglected properties, remediating environmental contamination and supporting new housing development to strengthen the community and increase the city’s tax base. In December 1988, the city established the Economic Development Authority (EDA) to succeed the HRA as the primary tool for ongoing economic development. While HRAs and EDAs differ mainly in their statutory purposes, an EDA provides broader operational flexibility and can support a wider range of redevelopment activities, including commercial, industrial, and mixed-use projects. Pursuant to Minnesota Statutes, an Economic Development Authority (EDA) exercising the powers of a Housing and Redevelopment Authority (HRA) is authorized to impose a special benefit tax levy. The maximum capacity for this levy is restricted to 0.0185% of the total taxable estimated market value of the city. Revenue generated through the exercise of these specific HRA powers is formally excluded from the municipality's general levy limit calculations. For taxes payable in 2026, the final estimated market value for Blaine provided by Anoka County was $11,854,347,700, which would allow for the EDA to levy up to $2,193,054 for the 2027 tax year. The EDA tax levy was increased from $750,000 to $1,000,000 in 2023 to provide funding for capital- related projects including land acquisition, development assistance, and supporting redevelopment activities. While the baseline 2025 EDA operating budget aligned closely with prior years, the Board authorized a property tax levy of $1,150,000 with the full $150,000 increase dedicated to future targeted development/redevelopment initiatives, and authorized staff to place these funds in a separate fund for transparency purposes. The 2026 levy was increased by $75,000 to provide for the ongoing operations of the EDA while maintaining a $150,000 levy for targeted economic initiatives. On April 6, 2026, the City Council held a Public Hearing and adopted a resolution approving property tax abatements for the west parking facility in the 105th Redevelopment District. This action formally established the tax abatement district and provided the authority for the city to issue general obligation bonds to finance the parking structure. The project cost is estimated at $15 million. Existing revenue sources within the district, including tax abatement and tax increment financing from new development, have already been committed to other public infrastructure obligations. Because these revenues are fully allocated, they are not sufficient to support the new debt service associated with the parking structure. Conversations during the workshops and public hearing indicated most of the Council supported financing this activity with EDA funds. Annual debt service for the facility is estimated at approximately $1,293,000 with a 20-year amortization schedule. The first debt service payment is scheduled for 2028 and is proposed to be paid using EDA levy dollars collected in 2027. Annually, the city council will determine how to fund the ramp debt service and can utilize any funding source available, which could include the EDA levy in the future or other sources. The 2027 City Manager's recommended levy is at $2,193,054 or the maximum allowed by statute. At this level, $1,293,000 will be allocated to finance the estimated debt service for the west parking facility and $900,054 will be used to fund the general operations of the EDA. This operating levy is suitable for the continuation of routine ongoing operations, including staff salaries, business appreciation events, and deliverables at the 3M Open as a result of reducing the annual transfer of funds to the General Fund general administrative support. It's important to note that while this levy is sufficient to cover existing obligations, no additional funds will be made available for development opportunities. Page 8 of 15 ## EDA Levy History ## Levy Item 2022 Levy 2023 Levy 2024 Levy 2025 Levy 2026 Levy 2027 City ## Manager ## Recommend ## Levy Operating $750,000 $1,000,000 $1,000,000 $1,000,000 $1,075,000 $900,054 Non-Operating - - - $150,000 $150,000 $1,293,000 Total $750,000 $1,000,000 $1,000,000 $1,150,000 $1,225,000 $2,193,054 ## Levy Setting Process State statute requires local governments to adopt a preliminary levy by September 30. After that approval, the preliminary budget can still be changed and the levy can be reduced, but not increased, prior to adopting the final budget and levy in December. Best practice is to adopt a preliminary levy that provides adequate flexibility for the council to react to changing economic conditions and needs of the community. ## Remaining Budget Schedule: ## January 26 Council Retreat ## February 18 Budget Calendar Review & City Manager Guidance March 23 - April 2 Small Group Meetings with Mayor and Councilmembers April 13 Budget Review Post-Small Group Meetings – General Council Direction ## June 8 General Fund and City Tax Levy ## July 13 Capital Funds ## August 10 Review General Fund and EDA Levy Septmeber 9 Reserved for Budget Review if needed (Preliminary Levy) ## September 14 Internal Service Funds September 21 Adopt Proposed General Fund, EDA, Capital Budgets, and City Tax Levy ## October 5 Charitable Gambling and Communications Funds ## October 12 Utilities and Refuse Funds October 19 Reserved for Budget Review if Needed (Levy & Utility Rates) ## November 2 Review Charitable Gambling Fund Scoring ## November 9 Truth-in-Taxation Preparation and Budget Review ## December 7 Truth-in-Taxation Public Meeting December 21 Adopt Final General Fund, EDA, Capital Budgets, and Tax Levies ## Staff Recommendation ## Questions for Council Page 9 of 15 Does the Council support the City Managers' recommended 2026 City and EDA property tax levies? The current calendar calls for the adoption of the proposed property tax levies at the September 21 Council meeting. Further adjustments will occur throughout the fall prior to final adoption in December. ## Attachment List ## 1. City Levy Exhibits ## 2. General Fund & EDA Budgets Page 10 of 15 ## Levy ## Item ## Fund2026 Final Levy 2027 City ## Manager ## Recommended (August) ## Total Change From '26 to '27 Levy ## Percent ## Change From '26 to '27 ## Levy ## General Fund43,239,487$ 43,239,487$ 1Personnel (Union & Nonunion Step Progression)- 1,825,907 2Cafeteria Plan Increase- 167,520 3Self-Insurance- 125,000 4Workers Compensation- - 5Compensated Absences- 50,000 ## 6Facilities Fund Internal Service Charges- 125,000 7Commodities/Services- 2 71,838 ## 8Contractual Commitments Above CPI- - ## 9Anoka County Flock/LPR Consortium- - 10 SBM Fire Funding (Operating) - 184,008 112026 Election Year- (92,525) ## 12Reduce Engineering Charges for City Projects- 200,000 13Misc. Revenue Increase- (356,188) 14Additional Safe Margin- 50,000 15Additional Position(s)- 1 63,872 16Additional Mowing Services- 75,000 ## 17Modify Asst. Comm Dev Director Position- (165,461) Total General Fund43,239,487 45,863,458 2,623,971 6.1% ## Capital 18Pavement Management Plan650,000 800,000 19Capital Equipment1,000,000 1 ,600,000 20Parks & Trails500,000 450,000 21SBM Capital Equipment1,015,360 1,015,360 Total Capital3,165,360 3,865,360 700,000 22.1% 22Debt Service ## GO Improvement Bonds 2013A (67)- ## GO Equipment Capital Note 2016A (70) (NMTV)- ## GO Improvement Bonds 2016A (71a)17,068 ## GO Improvement Bonds 2016A (71b)163,251 GO Improvement Bonds 2016A (71d)723,870 717,570 GO Taxable Improvement Bonds 2017A (72a)253,888 250,248 GO Improvement Bonds 2019A (75)556,306 555,865 GO Capital Improvement Plan Bonds 2019B (76)487,725 487,463 ## GO Capital Improvement Plan Bonds 2020A (77) 513,115 510,498 GO Improvement Bonds 2021A (78A)466,096 465,473 GO Improvement Bonds 2021A (78B)112,248 113,928 GO Improvement Bonds 2022 (79A)675,884 675,918 GO Improvement Bonds 2023A (80A)713,129 714,749 GO Equipment Certificates 2023A (80C)692,475 688,800 105th Ave Tax Abatement Turf Fields (81) 2024A603,435 878,535 GO Improvement Bonds (82A) 2024B806,813 807,294 GO Equipment Certificates (82B) 2024B689,850 693,000 City Improvement Bonds 2025A350,000 256,841 ## City Improvement Bonds 2026- 675,000 ## City Equipment Bonds 2026- ## 105th Avenue Tax Abatement Infrastructure 2026- 850,000 Debt Service Total7,825,153 9,341,182 1,516,029 19.4% Total Levy54,230,000$ 59,070,000$ 4,840,000 8.9% ## City of Blaine, Minnesota Exhibit A - 1 2027 Property Tax Levy - Detail - August 10, 2026 Workshop Page 1 Page 11 of 15 ## Levy ItemFund/CategoryDetail ## Total Change From '26 to '27 City ## Manager ## Recommended ## Levy Base/existing employment base Includes position reclassifications or adjustments through 7/15/2026 Assuming union group compensation per final contract settlements Cafeteria plan assumes $600/year increase (same as previous years) $1,640 / month for full time employees electing coverage $855 / month for full time employees if coverage is waived 2026 funding $1.25MM, 2026/2027 Standard Premium $623k; Excess Liability $193k $100k deductible per occurrence/$200k standard aggregate/$4M MEL aggregate; Plan Year July-June Ending 2025; $1.5MM of expenses and $1.2MM of revenue Ending 2025: Net Position $90k, incurred but not reported $380k No current/proposed funding for new vehicle/equipment replacement (residual vs new) Land-use litigation costs are based on a sliding scale, includes a 15% copay on the first $250k and 40% on amounts above that Increase spread amongst funds, 75% General Fund 2026 funding $2.1MM, 2026/2027 Premium $919k 2026/2027 Standard policy, $10k Deductible per occurrence; plan year July-June 2025 Retro-Premium refund of $493k; 2026 Retro-Premium charge of $66k (spring/annually) 2025 Audit Adjustment refund of $40k (fall/annually) ## Ending 2025: Net Position $1.1M No Increase (Typically spread amongst funds, 92% General Fund) 2021-2025: Funding $789k; Payouts $2.6MM; Total shortfall $1.8M 2025: Funding $161k; Payouts $408k; Shortfall $247k Ending 2025: Cash $1.04M Increase spread amongst funds, 93% General Fund Assumes 8.5% increase year over year per 5-year fund summary and CIP Increase spread amongst funds, 76% General Fund Assumes usage of overall Consumer Price Index change for 2025 = 2.7% ## Total 2026 Expenditure Budget for General Fund = $53,352,887 Excludes: T&T = $312,725; SBM = $2,911,335; Facilities = $1,466,770; Personnel = $37,597,203 Remaining Budget to apply CPI: $10,983,303 Historical increases: 25% for 2022 Actuals; 11% for 2023; 2% for 2024; 7% for 2025 Various costs the city incurs are subject to discretion and contractual commitments Assumes some level of cost increase beyond consumer price index Departments were able to remain within the CPI increase; planned for extra 1% or $110k On December 18, 2023 Council approved a three year agreement with Flock Safety Current contract for cameras/LRP is paid for from Public Safety Aid Funds $100k annually County contract anticipated to start in 2027; city share to remain in Public Safety Aid one more year Ongoing operating funding: 2024 up 3.5%; 2025 up 10.0%; 2026 up 5.1% 2027 SBM proposed budget; city share $3.1M up 5.83% ## Blaine 76%; Mounds View 15.5%; Mounds View 8.5% ## City of Blaine, Minnesota Exhibit A - 2 2027 Property Tax Levy - Detail - August 10, 2026 Workshop 271,838 - - 184,008 167,520 125,000 - 50,000 125,000 ## Anoka County Flock/LPR Consortium ## Contractual Commitments Above CPI ## Compensated Absences ## SBM Fire Funding (Operating) 5 ## Personnel (Union & Nonunion Step Progression) 11,825,907$ 4 2 3 ## Cafeteria Plan Increase 7 ## Workers Compensation ## Self Insurance ## Commodities/Services 10 ## 6Facilities Fund Internal Service Charges 8 9 Page 2 Page 12 of 15 ## Levy ItemFund/CategoryDetail ## Total Change From '26 to '27 City ## Manager ## Recommended ## Levy ## City of Blaine, Minnesota Exhibit A - 2 2027 Property Tax Levy - Detail - August 10, 2026 Workshop 11Elections 2027 is a non-election year, costs fluctuate accordingly (92,525) Engineering staff track their time spent on city projects then charge this time back to the associated project account (capital project or utility fund) Most of the this time/cost is allocated to activities funded through debt The current revenue budget for this activity in the General Fund is $250k, 2027 is the final year of a 3-year timeline to eliminate this chargeback; $50k to remain in budget for costs incurred by developers Administration fees charged to the EDA Fund for services provided by city employees, $419k per year Administration fees charged to the Enterprise Funds for services provided by city employees, $2.6MM per year Vehicle & equipment maintenance fees charged to the Water and Sewer Funds, $433k per year Police State Aid increase = $1.0M ## Municipal State Aid Maintenance increase = $1.0M ## 14Additional Safe Margin City safe margin to be established in an amount between 1% and 1.5%, the adjustment brings the 2027 safe margin to $490k 50,000 15Additional Positions Reflects the estimated cost to add one Police Detective; early planning anticipated an two additional hires 163,872 In 2025 the work crew which performed basic landscaping services discontinued Impacts to the overall aesthetics of city parks and open space In lieu of additional staff, funding established to pursue additional contracted mowing services Funded through a reduction in the parks capital improvent plan levy ## 17Modify Asst. Comm Dev Director Position Remove full-time position; reclassify into internship role (165,461) Crack-sealing program funding to remain at $250k; city-wide 7 year program Additional funding to buy-down future bonding requirements Pavement Condition Index (PCI) Study budgeted for in 2026; use of unrestricted GF reserves 2026-2030 CIP increased funding from $1.0M to $1.6M Goal is to be pre-funded by 2029 Lack of prefunding capital needs may impact credit rating 20Parks & TrailsReduced capital levy to accommodate contracted mowing services in parks (50,000) Increased funding from $569,752 in 2025 to $1,015,360 for 2026 and 2027 Capital funding was born out of reallocating retired debt service related to the fire department No additional capital funding planned for until future fire station financing is determined ## Blaine Share 76%; Mounds View 15.5%; Mounds View 8.5% Main funding source for capital projects Assumes 25% of all improvements will be assessed for the 2026 transportation projects Use of unrestricted General Fund reserves to purchase capital equipment 2026 pavement project related bond levy at $675k annually for 15 years Permanent Financing of 2024D 105th Tax Abatement Bond at $850k annually for 20 years Assumes current interest rate environment and no contingency buffer ## Total 2027 CMR Property Tax Levy Increase4,840,000$ - 1,516,029 (356,188) 75,000 150,000 600,000 200,000 Engineering Fees 19Capital Equipment ## Mowing Services 12 ## SBM Capital Equipment21 ## Debt Service22 ## 18Pavement Management Plan 16 ## Revenue Increases13 Page 3 Page 13 of 15 2023 Actual 2024 Actual 2025 Actual 2026 Adopted ## Budget 2026 Amended ## Budget ## 2027 City Manager ## Budget 2028 Projection 2029 Projection 2030 Projection 2031 Projection ## Revenues Taxes31,233,575$ 36,252,629$ 38,813,505$ 43,239,487$ 43,239,487$ 45,863,458$ 48,750,000$ 51,600,000$ 54,450,000$ 57,400,000$ Special Assessments799 - - - - - - - - - Licenses & Permits2,952,707 3,045,226 2,481,978 2,348,700 2,373,700 2,304,450 2,254,450 2,204,450 2,154,450 2,104,450 ## Intergovernmental2,079,673 2,500,893 3,022,169 2,308,000 2,587,934 2,538,173 2,613,173 2,688,173 2,763,173 2,838,173 Charges for Services5,348,447 5,321,971 4,945,902 5,269,300 5,250,300 5,446,850 5,471,850 5,496,850 5,521,850 5,546,850 Fines & Forfeits263,017 299,602 307,547 220,000 220,000 220,000 245,000 270,000 295,000 320,000 Investment Earnings566,600 951,279 1,479,630 230,000 230,000 230,000 230,000 230,000 230,000 230,000 Miscellaneous75,920 127,329 196,506 120,000 120,000 120,000 125,000 130,000 135,000 140,000 Total Revenues42,520,738 48,498,929 51,247,237 53,735,487 54,021,421 56,722,931 59,689,473 62,619,473 65,549,473 68,579,473 ## Expenditures ## Legislative460,109 463,329 556,250 541,921 541,921 639,977 671,000 704,000 738,000 774,000 Administrative Services2,642,225 2,924,481 2,730,939 3,294,364 3,292,364 3,299,878 3,462,000 3,631,000 3,809,000 3,995,000 ## Finance3,207,501 3,199,059 3,514,717 4,614,247 4,614,247 4,805,826 5,041,000 5,288,000 5,547,000 5,818,000 Safety Services17,369,766 18,872,206 19,977,746 23,085,914 23,092,784 24,497,283 25,551,000 26,581,000 27,638,000 28,724,000 Fire Services2,361,784 2,490,793 2,724,708 2,911,335 2,911,335 3,095,343 3,247,000 3,406,000 3,573,000 3,748,000 Public Works7,863,921 8,092,330 8,465,408 10,326,719 10,501,765 10,828,599 11,265,000 11,816,000 12,256,000 12,855,000 Engineering1,884,954 1,999,846 2,147,896 2,379,975 2,404,975 2,506,509 2,629,000 2,758,000 2,893,000 3,034,000 Recreation1,560,596 1,683,678 1,799,601 1,904,822 1,904,822 2,072,122 2,174,000 2,280,000 2,391,000 2,508,000 Community Development2,657,734 2,750,179 2,661,361 3,210,532 3,297,531 3,274,906 3,435,000 3,603,000 3,779,000 3,964,000 ## Unallocated436,319 627,889 939,451 1,148,058 1,148,058 1,334,888 1,618,000 1,920,000 2,243,000 2,590,000 Total Expenditures40,444,909 43,103,790 45,518,077 53,417,887 53,709,802 56,355,331 59,093,000 61,987,000 64,867,000 68,010,000 Revenues Over (Under) Expenditures2,075,829 5,395,139 5,729,160 317,600 311,619 367,600 596,473 632,473 682,473 569,473 ## Other Financing Sources (Uses) Transfers In112,807 37,500 - 122,400 122,400 122,400 129,000 136,000 143,000 151,000 Transfers Out(1,500,000) (362,895) (2,915,696) - (2,000) - - - - - Total Other Financing Sources (Uses)(1,387,193) (325,395) (2,915,696) 122,400 120,400 122,400 129,000 136,000 143,000 151,000 Net Change in Fund Balance688,636 5,069,744 2,813,464 440,000 432,019 490,000 725,473 768,473 825,473 720,473 ## Beginning Fund Balance16,352,276 17,040,912 22,110,656 22,110,656 22,110,656 22,550,656 23,040,656 23,766,129 24,534,602 25,360,075 Ending Fund Balance17,040,912 22,110,656 24,924,120 22,550,656 22,542,675 23,040,656 23,766,129 24,534,602 25,360,075 26,080,548 ## Adjust for Inventory280,492 360,270 339,640 - - - - - Adjust for Prepaid Items57,236 74,893 345,660 - - - - - Adj Fund Balance, Dec 31 (Net of Restricted)16,703,184 21,675,493 24,238,820 23,040,656 23,766,129 24,534,602 25,360,075 26,080,548 30% Subsequent Years Budget13,972,460 14,904,629 16,025,366 17,727,900 18,596,100 19,460,100 20,403,000 21,457,870 5% Subsequent Years Property Tax Levy1,819,279 1,977,380 2,161,974 2,437,500 2,580,000 2,722,500 2,870,000 3,050,481 State Funding Un-Allotment670,000 820,000 820,000 1,190,000 1,190,000 1,190,000 1,190,000 1,190,000 Budget Roll Forward Assignment- - 25,134 - - - - - Minimum Unassigned Fund Balance16,461,739 17,702,009 19,032,474 21,355,400 22,366,100 23,372,600 24,463,000 25,698,351 ## Unrestricted Fund Balance241,445$ 3,973,484$ 5,206,346$ 1,685,256$ 1,400,029$ 1,162,002$ 897,075$ 382,197$ ## 2027 City Manager Recommended Budget - August 10, 2026 ## Summary of Revenues, Expenditures, and Change in Fund Balance (Unaudited) General Fund - 101 ## City of Blaine, Minnesota Page 14 of 15 2023 Actual 2024 Actual 2025 Actual 2026 Adopted ## Budget 2026 Amended ## Budget ## 2027 City Manager ## Budget 2028 Projection 2029 Projection 2030 Projection 2031 Projection ## EDA Operating Revenues ## Taxes 996,729$ 1,008,661$ 994,435$ 1,080,000$ 1,080,000$ 905,054$ 945,000$ 995,000$ 1,040,000$ 1,090,000$ ## Special Assessments5,739 5,518 5,297 3,000 3,000 3,000 3,000 3,000 3,000 3,000 Charges for Services64,440 97,934 108,698 69,400 69,400 62,200 64,700 67,200 69,700 72,200 Investment Earnings165,943 116,710 125,929 15,000 15,000 10,000 10,000 10,000 10,000 10,000 ## Miscellaneous2,229 1,952 - - - - - - - - Total EDA Operating Revenues1,235,080 1,230,775 - 1,234,359 1,167,400 1,167,400 980,254 1,022,700 1,075,200 1,122,700 1,175,200 ## EDA Operating Expenditures ## Personnel Services182,652 195,559 203,228 214,428 214,428 226,668 236,668 246,668 256,668 266,668 Supplies361 105 304 500 500 500 500 500 500 500 Contractual Services334,658 294,443 289,699 452,000 452,000 286,055 298,555 311,055 323,555 336,055 ## Other Services & Charges493,343 513,678 476,623 502,161 502,161 467,031 486,325 506,325 526,325 546,325 Capital Outlay1,091,180 (4,042) - - - - - - - - Total EDA Operating Expenditures2,102,194 999,743 969,854 1,169,089 1,169,089 980,254 1,022,048 1,064,548 1,107,048 1,149,548 ## Q EDA Operating Subtotal(867,114) 231,032 264,505 (1,689) (1,689) - 652 10,652 15,652 25,652 ## EDA Targeted Initiatives Revenues Taxes- - 150,000 150,000 150,000 1,293,000 1,300,000 1,300,000 1,300,000 1,300,000 Investment Earnings(145,697) 5,888 90,542 - - 10,000 10,000 10,000 10,000 10,000 Miscellaneous- - 66,876 - - - - - - - Total EDA Targeted Initiatives Revenues(145,697) 5,888 307,418 150,000 150,000 1,303,000 1,310,000 1,310,000 1,310,000 1,310,000 ## EDA Targeted Initiatives Expenditures Contractual Services- 1,499,000 180,000 - - - - - - - ## Capital Outlay436,559 2,554,406 3,632,555 - - - - - - - Total Targeted Initiatives Expenditures436,559 4,053,406 3,812,555 - - - - - - - EDA Targeted Initiatives Subtotal(582,256) (4,047,518) (3,505,137) 150,000 150,000 1,303,000 1,310,000 1,310,000 1,310,000 1,310,000 ## Other Financing Sources (Uses) Transfers In2,594,435 3,961,046 - - - - - - - - ## Transfers Out3,700 - - - - - - - - - Transfer Out - 105th West Parking Debt Service- - - - - (1,300,000) (1,300,000) (1,300,000) (1,300,000) (1,300,000) ## Land Sale Proceeds- - 3,011,799 - - - - - - - Total Other Financing Sources (Uses)2,590,735 3,961,046 3,011,799 - - (1,300,000) (1,300,000) (1,300,000) (1,300,000) (1,300,000) Net Change in Fund Balance1,141,365 144,560 (228,833) 148,311 148,311 3,000 10,652 20,652 25,652 35,652 ## Beginning Fund Balance 3,118,180 4,259,545 4,404,105 4,331,972 4,331,972 4,323,583 4,326,583 4,337,235 4,357,887 4,383,539 Ending Fund Balance4,259,545 4,404,105 4,175,272 4,480,283 4,480,283 4,326,583 4,337,235 4,357,887 4,383,539 4,419,191 ## Cash Reconcilliation Beginning Cash783,726 2,113,610 2,498,814 2,571,241 2,571,241 2,283,681 2,286,681 2,297,333 2,317,985 3,343,637 Change in Cash1,329,884 385,204 (363,444) 148,311 148,311 3,000 10,652 20,652 1,025,652 1,490,082 Ending Cash2,113,610$ 2,498,814$ 2,135,370$ 2,719,552$ 2,719,552$ 2,286,681$ 2,297,333$ 2,317,985$ 3,343,637$ 4,833,719$ Loans/Accounts Receivable1,563,541$ 2,803,798$ 2,921,177$ 2,921,177$ 2,921,177$ 2,921,177$ 1,921,177$ 466,747$ ## City of Blaine, Minnesota Economic Development Authority - 213 & 415 ## Summary of Revenues, Expenditures, and Change in Fund Balance (Unaudited) ## 2027 City Manager Recommended Budget - August 10, 2026 Page 15 of 15