East Bethel City Council — Transcript
Monday, July 13, 2026
2027 Proposed Budget Overview
Budgeting Philosophy for Revenues
Future Budget Meetings and Strategy
Votes (14)
Adopt Agenda
Moved by Council Member [0:00] · Seconded by Council Member [0:01]
A motion was made and seconded to adopt the evening's agenda without further discussion.
2027 Proposed Budget - Sheriff Department
The Sheriff Department budget proposal for 2027 includes a continued 36-hour contract for deputy coverage, accounting for 7.56 deputies to cover time off and ESST. Specific costs for benefits (health insurance up 9%, dental up 4%), uniforms, vehicle replacement ($45,650 annually for a 24-hour car), maintenance ($54,375), insurance, equipment, and administrative costs were detailed. The total cost to the city, after police state aid, is $1,645,232.
2027 Proposed Budget - General Government
This category covers Council (4% increase due to salary and watershed bills), City Administration (9% increase primarily due to salaries, an intern position, newsletter costs, and computer replacement), Elections ($3,000 for equipment lease in a non-election year), Finance (3% increase for salaries and computer replacement), Assessing (1% increase for Anoka County contract), Legal (flat at $195,000 with a new provider), Government Buildings (flat 0% increase), and Risk Management (flat 0% increase). Overall, the General Government category is looking at a 3% increase.
2027 Proposed Budget - Community Development
The Planning and Zoning budget shows a 35% increase, largely driven by the full budgeting of an unfilled Community Development Director position and a planner position for 2027. Computer replacement is also factored in every five years. The Building Inspection budget has a standard 3% increase for salaries and 1% for computer replacement.
2027 Proposed Budget - Public Safety (Police & Fire)
Police protection is proposing a 4% increase. Fire protection shows a 16% increase, which, after an accounting adjustment for state retirement aid (which doesn't actually touch city books), results in a 5% operational increase. This 5% increase is mainly due to 3% salary increases for full-time and paid-on-call firefighters and CIP items for truck replacement. Challenges in forecasting paid-on-call firefighter costs due to call volume variability were noted. Discussion also covered medical supplies, with most disposables obtained from Alina but specific medications and some supplies requiring city purchase.
2027 Proposed Budget - Public Works (Street & Park Maintenance)
Both park maintenance and streets departments are seeing about a 4% increase, primarily due to salaries and computer replacement. The street maintenance fund covers city streets (130 miles, 14.5 gravel), storm sewer, and fleet vehicle repairs, with minor budget bumps for safety supplies and in-house vehicle repairs. The park maintenance budget supports 250 acres of parkland, building grounds, and some road right-of-way mowing. Employees are coded across these funds but perform jobs for both. A transfer from the general fund covers staff services.
Park Capital Improvement Plan (CIP)
The 5-year park CIP is updated annually. The park acquisition and development fund, derived from developer fees, will fund Viking Meadows playground development into 2027. Future projects include ball field lights for Booster West ($350,000 in 2028). The park capital fund, from general fund transfers, is requesting a $10,000 annual increase to reach $130,000 for 2027. Planned projects include pickleball courts, a trail segment in John Anderson, repairs at Booster West, and a basketball court replacement at Lake Beach. Long-term items include parking lots for Booster East/West, tennis/basketball court replacements at Whispering Aspen, and potential development of Bonnie Park and Oak Brook Acres.
Roads Street Capital Improvement Plans (CIP)
The city has two funds for major street work: the State Aid Construction Fund (MSA), receiving $778,000 annually, and the street capital project fund, with a proposed $50,000 annual increase from the general fund. 2027 projects include redoing Polk and Jackson roads and Klondike Drive (Polk to Highway 65). Future projects include Briarwood Avenue (2028), paving the gravel portion of Klondike Drive ($3 million, 2030), and various neighborhood overlays including Gardner (2027), Riderwood (2028), Morrison Manor (2029), and Durant Street/Raintree/Columbine Drive (2030-2031). The policy for dirt roads requires a neighborhood petition, with the city contributing $100,000 and the remainder assessed to benefiting properties.
Equipment Replacement Plan
The equipment replacement plan is a roadmap, not a strict schedule, allowing for flexibility based on equipment condition, resale value, and new equipment costs. Purchases remaining from 2026 include a single axle plow truck and fire department extrication tools. For 2027, the plan includes a front-end loader (likely to be pushed down), a Kubota for parks, a Ford Explorer for the fire department, and the lease on a new fire department apparatus. The city aims to extend the useful life of equipment beyond 10 years, typically 12-15, and benefits from favorable resale on state auction sites.
2027 Proposed Budget - Water Department
No rate increases are anticipated for 2027. The water fund is an enterprise fund, meaning it's solely funded by user fees, not the general levy. The city operates two water treatment areas (Whispering Aspen and Viking) and employs three certified water and sewer operators. A transfer of $81,000 annually is made from the water fund to the general fund to reimburse for staff time. A notable discussion point was the higher per-gallon rate in Whispering Aspen compared to Viking Meadows due to historical contractual rates and different initial costs, with the goal to equalize them over time.
2027 Proposed Budget - Sewer Department
The sewer fund anticipates a 3% increase in rates, from $6.30 to $6.50 per ERU per month and usage from $6.70 to $6.90. This increase is primarily driven by rising flow charges from the Met Council, which handles the actual treatment of sewage after the city's collection. The city's role is now limited to collection.
2027 Proposed Budget - Arena Fund
The arena fund is self-financed through user fees, primarily from the St. Francis Youth Hockey Association and High School, with no general fund dollars. The city moved to in-house management two years prior, employing 5-8 part-time staff and one full-time project manager, Jason Hare. Revenues are exceeding expenditures, and the budget for 2027 is $8,000 cheaper than the previous year due to improved estimates for part-time help. Dry floor events still occur, mainly baseball teams, which are managed with keys and deposits rather than staffed.
TIF Districts Review
The city has four active TIF districts (Apartments one and two, Viking Preserve, Trident Senior Living, Aggressive Hydraulics) operating on autopilot. Funds are collected by the city through property taxes, with 10% retained and 90% paid back to developers via pay-as-you-go notes. Non-compliance by developers (e.g., the clinic project not happening) means the city does not pay out the money. The balance of these notes gradually reduces until the developments become fully taxable.
Overall Levy Impact and Capital Needs
The proposed 5.9% total levy increase is driven by the general fund (6%), 2015A bond issue (3% annual increase), and 2014A bond issue (flat $230,000), plus EDA (12%) and HRA (0%) increases. Discussion highlighted the disparity in the building capital fund, which has a substantial balance ($483,000) but is only receiving a $50,000 annual transfer, despite $2.5 million in projected building repairs over five years. The mayor and council expressed concern over funding future capital needs and the potential impact of a state grant on the budget, noting the grant's uncertainty and possible ancillary costs.
Notable Quotes (32)
Someone want to make a motion to adopt agenda?
for 2027, uh the city we've proposed sticking with uh another 36-hour contract. That's standard for what we've we've done for several years now.
The total levy increase would be 5.8%. So, again, what we're proposing today, all the activity and all the department requests, um, in order to balance that budget, the levy would need to increase 5.8% and that's the general fund levy and the debt service levy combined and give you that 5.8%.
When you give your line item deal like that, is there any way that when you do that uh we can have [clears throat] the comparison to the previous year?
Again, the increase is primarily due to salaries. We've also built in that intern again to the 2027 budget and again that intern really is a seasonal position that helps with the scanning and kind of uh backing up maybe the building tech position as well during the summer.
I mean, why It's under the administration part, but why did is our printing and duplicating jumping so high? It was from 6,000 to 20,000 this year.
this budget still contemplates those roles being present. Certainly not something you have to decide tonight um or or as you move forward in your budget, but it does include those at this time.
And I would just remind council too that if we don't fill that position, we don't spend those dollars, it goes back into the general fund for the next year. We're we're kind of on that precipice right now of trying to determine when we're going to need this full-time position given some of the demand that we're seeing.
again, if you take that out, it's kind of an accounting thing. The fire department budget's supposed to increase by 5%.
So, being a paid-on-call fire department, we are held hostage, if you will, by the number of calls that we respond to every year. Um if it's a if it's a high year or if we have a great increase, that dollar amount that we're paying our paid on-call firefighters is going to be more.
So, Chief, are we still working on uh, prioritizing our calls that we're not responding to? I mean, I would think that number would drop.
Our street maintenance fund covers our city streets, um storm sewer system. Our repairs on fleet vehicles that comes out of this fund. So, it covers quite a few things. We've got 130 mi of center line roads in our city.
Now, you got All right, how many employees do you have? There's nine total full-time employees. Okay. And they do jobs from both departments. We code four to parks and five to streets, but it really could be any person could be interchanged.
This is funded through the money we get from developers when they put in a new development or a split a lot. Um it's not it's not coming from the general fund.
So, now were we responsible for that price? The city? That money for that park came from the developer.
The state aid construction fund, the MSA fund is covered by costs that we get received from the state of Minnesota. These are monies that come from gasoline tax, other highway tax that cities get distributed back based on our population, traffic counts, number of miles.
What are our plans for the other dirt roads in the city? I mean, we have what? 14 miles
right now, our policy is if the neighborhood wants to have them paved, they can petition the city. The city will front, I think it's $100,000 of the project that we would normally be using to for regular maintenance on that. And then the rest is distributed through assessments to the benefiting properties.
I just want to say something regarding equipment replacement because as you know, I've been kind of not exactly for replacing something because it was a 10-year timeline. And so I did talk to a couple other cities, and some say they drive their vehicles 20, 30 years until it doesn't drive anymore.
Again, this is just a road map of all of our equipment and the potential dates of when it's going to be replaced, but this is just the first phase and the first approval, basically, of when we think it needs to be replaced, but you again, you'll have other opportunities when these actually are up for replacement to again look at their useful lives and the condition of the the the equipment.
Yep, so your enterprise funds again are not funded through your general levy. They're strictly funded through the user fees that we essentially bill to each one of the customers.
Can I ask why um the per gallon per thousand gallon it's so much higher in Whispering Aspen than it is over in um Viking Meadows El Baj area?
Contractually, there's some rates that we are stuck with on the on the startup side of things. So, the By who? By Met Council. No, it's the a contract between the city and the developer. So, again.
Nope. We've got a change to the uh general fund transfer, just a small amount increase in there, and yeah, the rest of it's the professional service fees cost from the Met Council. Oh, we handle our collections, so everything we treat gets sent down to Met Council for the actual treatment. In the past, we had a sewer treatment plant that we ran, but we're only in the collection business now, so.
There is no general fund dollars that go into this. Um I think it was what? Two two years ago that we changed management from a standalone management team to the city handling it in-house.
So, since we made that change, how are we doing with that, Mike? I mean, are are we breaking even or Yes. I operation this year.
And that includes [snorts] $69,000 going back into the general fund that's offsetting what the taxpayers pay for our So, it's actually making money for the city in that sense, too.
essentially the city takes the money in, it uh keeps 10% of that and then pays 90% of that out back to the the developers and those are on the books until the pay-as-you-go notes are satisfied and then as that happens then the full value of those developments get put back on the the tax rolls and become fully taxable to the city.
How's that work when uh a TIF doesn't fulfill their obligation of Yep. So, it's a good question. So, we the apartments cuz they were supposed to put that clinic and everything in as part of that TIF. Yep. So, essentially that never happened. So, there was never never anything um I guess uh approved upon there. So, the four active ones we have, if they don't meet the requirements of their agreement, then the city doesn't pay out the money.
Um building capital, I mean, I see we're transferring 50 into it, but we've got 2.5 million worth of uh uh coming up due on just repairing stuff on our buildings. I mean, 50,000 a year ain't going to suffice. That 2.5 in 5 years. I mean, we got to def- definitely start looking at this going up somehow.
The reason why it's two figures is because it was 4 and 1/2, but with the federal haircut up to a million, we're going to go The plan is to go in and ask for 6 and 1/2. Um if they only award us 4 and 1/2, then the money that we're missing in that is what's called contingency money. So, you find unsuitable soils or something like that, all of a sudden your costs go up to try and remediate those soils. We don't have those dollars in the project now because of that $2 million reduction.
overall um I think the majority of the cost can be attributed to public safety. Which most folks, I think, can Nobody loves Nobody loves increased cost, but public safety is a good reason for it.
Ordinances & Resolutions (10)
The primary document under review during the work meeting, detailing departmental expenditures and revenues.
A 5-year plan for equipment replacement and infrastructure projects for parks and streets.
Agreement dictating salary increases for union employees, influencing overall staff salary projections.
Agreements governing the Tax Increment Financing districts, dictating developer obligations and city payments.
The mechanism for the city to pay back increment to developers in TIF districts.
A bond issue with an amortization schedule influencing the annual levy increase.
A bond issue with a set cash flow amount of $230,000 for its remaining life.
A fund generated from developer fees, used for park projects.
A fund supported by transfers from the general fund for park capital projects.
A fund for road repairs, covered by monies received from the state of Minnesota based on population, traffic counts, and miles.