All right, that moves us along to our action items. We just have one and it's 8A, which is adopt resolution number 2025-68, adopting the proposed 2026 maximum property tax levy. >> Uh, mayor and council members, the uh item in front of you tonight is the offici first official action that you guys take on the 2026 budget. Uh, we've been talking about this actually for quite a while. The the first time we talked about it was back in a work session on June 30th and then we also talked about it a couple weeks ago uh during a work session. I think it was on September 8th. Um so a lot of what you guys are going to see here is what you've already seen. Um but we opportunity to sort of understand uh what's what goes into making the recommendation that we are. So uh going through the presentation. So we'll start just sort of talking about where we've been. Um you know the first part of our budgeting process that we always go through is identifying what those objectives we're trying to accomplish uh through the budgeting process and again this is just for our general fund but we use very similar objectives within each of our uh enterprise funds as well. So, first want to support our mission of being the best ball town in Minnesota. Uh maintain existing highquality service levels. Uh fully fund maintenance and replacement of vehicles, equipments, and physical assets on a regular schedule. Uh fund new programs only after existing necessary programs are funded. Develop a long-term budget plan that's sustainable to support the service levels our residents expect. Uh fully fund the needs of our street reconstruction program. And then budget utilizing a plan that avoids draw down on our uh general fund reserves. Really trying to keep our bond rating high as we're going through a lot of debt purchasing of debt because of uh our building program and streets and all that kind of stuff. Uh next slide. So uh you know sort of the heart of our discussion around setting a maximum tax levy is really talking about what is our tax levy policy. So this policy has been in effect since 2015 and uh really what it says is that we limit our tax levy growth to capture the new growth in the community. So that'd be uh all new buildings, new houses, things like that. New growth is really uh we really need to make sure that we're capturing that because if we don't, we're not capturing the resources that they bring into town that go towards the increasing amount of services that we have to provide because of new growth. So, it's I don't want to say it's a freebie, but it's sort of a freebie because it's uh you're it doesn't really have an impact on on existing uh properties, but we want to limit the uh tax levy growth to capture new growth in the community. And then uh expenditure inflation uh and you know making sure that you know if we have inflationary increases in our costs that we're making sure that we're keeping up with that and that we'd only increase the levy beyond this point if new service levels uh assets or initiatives are being added. In this year's case, this is the last year of our building improvement program. Uh so having a levy that's specifically addressing that. um after this year that is no longer something that we have to to work on. We would be completed with that. Next slide. So last year's uh just to give you a sense of last year compared to this year. So last year's uh uh key budget items that we talked about first of all continuing to utilize our tax levby policy uh uh continued implementation of our million-doll uh camp program. So that's our capital asset maintenance uh program. Uh so that's really going into uh something we created back in 2017 to really go back and fund the uh basically keeping up with the maintenance of uh things that need to get replaced like playgrounds or uh roads being resurfaced, trails being resurfaced, those things so we make sure that they stay in good shape. Um we talked last year about the fact that we completed our staffing study implementation. So we started that back uh in 2020. uh we had 19 positions uh that we were short uh for just the services we were providing and we worked on sort of closing that gap over that four-year period. Um last year was the implementation of the third year of our building improvement program. So 2026 would be the last year uh of doing that to complete that process. And then we continued building our general fund reserve balance. So, we actually have $300,000 budgeted uh that we've done annually since 2021 uh to help bring our reserve balances up. Uh at the same time though, uh we've had some pretty significant growth in the community that's allowed us to build our uh reserve uh balances up to healthier levels. So, back in 200 uh so in 2020 uh we had a $1.9 million uh general fund reserve balance. In 2024, we ended with 6.9 million which represents about 33%. The target is 40%. Uh so that's really sort of where we're aiming towards. So we're getting really close to that target of where we'd want to be. So where are we now? Um slide everybody hates. Um the local government aid. Uh again, I only throw this in here because uh we used to receive over a million dollars a year. If you consider 20 years of not receiving a million dollars a year is a lot of it's a lot of dollars left on the table. Um, one thing I think, uh, you know, we've really been able to do is, you know, when we when we get into when we sort of finished funding our staffing, uh, program, uh, we really sort of at that point sort of levied back what we lost in local government aid and were able to get ourselves to a staffing level that was appropriate for sort of the services we were providing. That's really where we saw the pain when when that LGA was taken away. And so uh I feel good now uh that uh we have levied that back and that really went into properly staffing ourselves. So um hopefully this will be the last year you see this. >> I almost said every year. >> I say it every year. Um next slide. Uh population growth. Uh so the 2024 population estimate was 29,830 people which was uh just over 11,000 households. Uh clearly with the the uh permits that we've had pulled over the last year and a half, we're uh clearly over 30,000 uh people right now. Uh so we've seen uh quite a bit of growth uh that's happened and you can see that with the population as the top uh chart uh where we started in 2000 where we are about uh uh 18,000 people in 2000 uh to now uh we're about 30,000 uh people. You know we've seen about uh you know 12,000 people or so increase in our community. I grew up in a community of 4,000 people. So that you know when I look at 12,000 it's like that's a lot of people to add in that short amount of of time period. So we've definitely seen growth and then you can see the household uh numbers down below. And maybe the thing to to really focus on in here is really where do we expect to be? So 2040 is really where we're sort of projecting where we're going to be completed uh with building. We'll be a fully built out community. You can see we we project that we're going to be about 36,000 uh residents and we'll have just a little shy of 15,000 homes uh in the community. U now that could shift a little bit here or there as far as the numbers based on the density of housing or you know within that time period between now and 2040 there's probably going to be some sort of an event that slows down housing growth. Uh so that could slow things uh down a little bit, but that's our best guess for when we'll be done and where we'll end up. >> So that's an interesting graph because it shows households and headcount. >> So that must mean it's a turning over to a fairly young community then because the the headcount is going up greater than the household. So it must be that there's a lot more youth. >> Yeah. And the other thing that that I think everybody's seeing is the size of the households, the number of people in the households is smaller uh now than it was in the past. Okay? >> Uh and so um you know there you know so you know in the past you may have seen maybe three people per household. Now we're probably closer to under two and a half uh people per household. So it's uh so we're we're definitely and I mean you can if you think about the development that we've seen I mean look at Adalwood is a good example I mean that was a lot of households 200 some households and each one of them have one to two people in there so uh so we do have a lot more diversity in the type of housing that we have uh now next uh graph and this really shows the growth that we've seen in building permits and I mentioned this to you guys during the uh work sessions that we had. But to me, one of the things that really stands out about this is I remember back in the 2000 to 2005 2006 time period that was like we were humming. There was a lot of growth happening and we thought boy we are really growing. But if you look at the amount of growth back at that time period compared to what we've seen over the last four years, it's significantly different. And you can see you know we had between about 2006 and 200 uh you know 2011 that little peak that we have come up that's actually the 212 medical center and then also United Health Group did their data center in that time period. So we didn't really see the residential growth start to come back until about 2014 uh after the recession. So we had about a six-year period there where we weren't seeing a lot of residential growth. Um but uh since 2020 we've seen significant growth and we expect that we're going to continue to see uh significant growth. Obviously we have one big uh development that's uh you know being uh you know developed right now uh out in southwest Chaza. Uh we've found out that the one remaining property uh in uh southwest Chaza that was remaining to be developed on the east side of the freeway now has a buyer uh to to put in housing there. Uh so I think we're going to start to we're going to continue to see some pretty heavy housing uh development. At the same time, we're seeing uh uh some pretty heavy interest in industrial development, too. So uh we'll see some real mixture in type. I mean, we know for certain next year that we're going to see three industrial projects and one of them is ours uh with the municipal service building, but we're going to see Edco and then we're going to see Beckman Coulter as well. Uh and there is uh interest uh in the the new industrial park down at 44 and 212. So, I I really think that our building permits the next couple years are are going to continue to be pretty high uh because of things that are just imminent and are waiting to to happen. Uh next slide. This looks at our market values uh the growth that we've seen. So, we continue to see very high growth. So, we saw a uh 7.51% uh increase in overall market value. So that's that bottom right hand corner. Uh the things I focus on when I look at this quite a bit is looking at uh each of the different categories. So you can see in 2025 we saw a 6.78% increase in market values for um for residential properties. Uh 2.83% of that is actually coming from new uh construction. Um in commercial industrial uh we you know we say 5.23% uh increase you know 2.7 of that is new construction. Uh apartments we saw a 20% increase uh or and all of that was from new construction uh that was occurring in the community because we had over 700 uh units that were uh constructed uh over the last year and a half. But then I look at the the total and when you look at that 7.51% uh 4.1% of that is actually new growth uh where 3.41% is uh is market changes. So the market changes that we're seeing in existing properties are pretty consistent with inflation. Uh and that but most of the increase we saw in market values uh is coming from uh new growth and you know we're now at $5.2 billion of value in our community now. So that's a um you know it's it's a a very high number. Next slide shows a distribution uh of uh how where we see those value uh or where we see the actual uh uh you know growth or buildings that we see in the community. You can see 75% of our uh community is uh residential. Commercial industrial is 15% apartments is 8%. I do think when we're uh said and done, all said and done with development, I think we're going to be closer to that 20% for commercial industrial uh in the community um because one thing that we did see in 2024 is we saw commercial industrial properties go from 9% of the total distribution to 15%. Uh so we are seeing an increase in the amount of uh commercial industrial and that's going to I think it's inevitable that that's going to change uh just given the industrial uh parks that are developing on the west end of the community. >> I mean that's really really neat to see that in such a short period of time we nearly doubled our industrial >> and commercial. >> Yeah. I mean you think you think of it out by you know the oppoden uh you know buildings out there. We have we've had and you know we United Health Group it sort of they sort of started things out and >> um you know we've seen a lot of development out there but we're also seeing um you know growth like physical growth in our existing buildings like Declan Coulter >> uh adding on to facilities but uh we've also seen quite an increase in the load for electricity uh being used uh by existing users in the community. It's not just from growth of new buildings. >> That's good. >> Uh, next slide. This is the history of our market values. Um, >> trend up. >> They they, you know, and a lot of this growth again has happened because of of new growth in the community. Um, everybody who's on the council in 2022 remembers that year because that was a year that >> Yeah, that was that was a tough year because most of that market value growth was the uh existing properties market values going up by 20 some percent. That was a tough year. Um but with that being said, there was a lot of uh real estate transactions happening in the community right around the time COVID uh was happening which really drove some of those valuations up. We've seen much more modest increases and a lot more of the valuation increases that we've seen recently again have been attributed to new growth uh within the community. Next uh one uh new construction. So this sort of points out uh you know what new construction has done as far as uh increasing in in uh valuation and you can definitely see uh the last three years and we expect this to go into next year as well. We've seen very high uh percentage of of new growth uh in the community uh which ultimately has an impact of reducing the burden on existing properties within the community for from a tax perspective. Next slide. Our electric fund transfer. So we have sort of two components that are involved in this. So if you remember when we set up the franchise uh fee for Minnesota Valley Electric and Excel and Centerpoint, we have a 5% franchise fee. So we we charge that same franchise fee to our electric fund uh for use of the rightway. Uh but on top of that, we've always made an additional 5% contribution from the electric fund into the general fund to help reduce uh taxes. The increase of this dollar amount is direct directly attributed to the increase in the in the amount of sales that we see in our community. So this represents uh 10% of our electric sales. So you can see from um you know 2013 we were at $3 million transfer and we anticipate we're going to be close to $5.5 million next year. So you know just through increase in electric sales uh we've seen an increase in the last uh you know 10 years or so of of just over $2 million. Uh so that's had a that has the impact also of decreasing the tax burden on our uh residents. Is that partially because the data center? >> It's, you know, actually it is uh, you know, like United Health Group and the other data centers have grown, but where we've seen more consistent growth has been with our existing industrial uh, businesses. >> Uh, so one of the things that happened I want to when did we put up the north state substation? Maybe five, six years ago. >> Yeah. So, we had to put a new substation up in our north industrial park uh because we could not keep up with the load and the growth. And those businesses, those buildings, a lot of them have been around since like the 80s. And so, >> so just the fact that we had to put a substation in there to be able to serve that load uh really shows what a increase we've seen from existing businesses in the community. >> That's cool. >> Uh next slide. So, you know, key factors uh that we look at is, you know, obviously our population and households. Um, you know, looking at how they increase. Um, and, you know, we, you know, continued growth that we anticipate. We talk about High Point Vista and Fultonwood are two ones that are developing now. Uh it's entirely possible, but that by mid next summer, we could see uh the remaining parcel uh uh on the east side of the freeway in southwest Chazer, right next to our park uh actually start to move forward with development for residential there. Uh so we continue to see that. We also are starting to see some real interest from developers of looking up in the Mc Mcnite Road area and that area is guided more for development uh like a green belt type development that would be more like Chvel >> uh type of development where you're trying to preserve uh different pockets of of green uh space um and then cluster development in certain areas. But there is starting to be interest there which doesn't really surprise me because uh the thing that's really driving that is the improvements that the county made to uh 82nd Street. >> Sure. >> Uh >> that neighborhood that's you know uh they're in my ward but I and I should know it's Autumn Woods the >> on the golf course on Hazeline and then there's like a new LAR >> just north of it. Yep. >> Is that Chaza or Chan? >> That's Chesa. >> That is Chaza. >> Yep. Chaza goes actually Chaza goes across Ottabon into the Shadowwood neighborhood. >> Well, that's mine. >> That's your Y >> the New Lanar. Our ward splits down or >> I'm talking like you know where Hazel team the golf courses and there's like >> that side of the street is in ward your ward. The other side of the street is in my ward. It's weird. >> But and then we have a little bit of >> shadow woods. Just a little little guy >> on the other side too. >> Yeah. But the the Liberty on Bluff Creek and all that is Chanhassen. Soon that's kind of the line. >> Yeah, we have just a little bubble that goes into Chanassen >> because I know where you're talking Shadowwood and that is cuz you're the whole other side of Audabon down through downtown. Yeah. >> Yep. And then across Ottabon that little is >> I didn't know that this new one I was thinking about at night going into introduce myself, but I thought that was Chan. >> Nope. That's that's all Chesa there. Yep. Uh as far as developments, uh permits again have continued to outpace our budget. Um you know, once again this year, I think we're probably going to be quite a bit over uh what we actually budgeted for revenue, which is good because again, we're trying to build up our general fund reserve balance. Um again we continue to see development uh interests and uh we know like I told you for certain uh that two industrial buildings uh will be under construction along with our uh building will be under construction next summer. And then uh we have the concept plan uh for uh the Razer property and the close property uh at 44 and 212. Uh they're going through the environmental process right now. Uh and we expect that we could see a concept plan uh sometime next summer and maybe even starting to develop that area over there by the by the end of next year or end of next summer. And then market values, again, we've continued to see increase in market values and uh we're really now seeing new growth increases outpace uh ex increases on existing properties, which again helps shift that tax burden off of existing properties. And we'll see that when in the chart where I sort of show you what we thought was going to happen with the building program and what's actually happening. Um you can really see the impact there that that new growth has had. >> Next >> I have one more question about residential. If you're going down the big woods towards downtown off 212 there's that inconce. I never even knew that was a neighborhood. Is that new? >> That that's probably within the last year. Okay. May where they've had maybe a two-year >> I do like the Harvest and Founders but then that I just saw the other day like for real and I'm like wow that's all new I think. >> Yeah. And those those are all custom uh built homes in there. >> Bunch of parade homes over there if you want to see them. Is the parade's still going on? If the parade's still going on parade of homes now though it's called something different, isn't it? >> No, I'm pretty sure they all the signs still say parade of homes. >> But I think there's like three or four of them over there. So, if anybody wants to see, >> it looks like a really nice new neighborhood. >> Walked through there last last couple nights. We've gone for walks because it's been so nice. And yeah, there's a good variety. And um two big two stories, walk outs, lots of windows. Some of those houses I was just like, I thought I had a lot like just so many windows. >> Yeah, they're very unique. I remember when I was door knocking last summer, just >> I didn't even know that was there. This is a new neighborhood >> altogether. I It's pretty cool because it's pretty tucked in the woods. So, >> yeah. Okay. Yeah, >> I had a quick question about the general reserve fund balance. I know right now we contribute like 300,000 annually to it and then we obviously put whatever additional um money that we get from uh construction permit. >> Mhm. >> I know our we're at like about 30% >> 33 right now. >> 33 and our target's like 40. >> So how long do you think anticipatory would it take for us to get to the target? Like how many years off are we on that? >> Not long. >> Okay. >> I mean, if we continue >> if we continue to see building permits outpace our what we're budgeting, that's what's going to push us up. >> Okay. >> Faster. >> I was just curious like what where we're at. >> I mean, my gut tells me two years. >> Okay. >> Yeah. >> Oh, okay. >> Cool. All right. >> All right. So, where we're going for 2026, so really three points. uh continued utilization of our tax levy policy, continued implementation of our camp program, our capital asset maintenance program, and then the last year of our building program. Those are really sort of the three things we're focusing on. Uh so as far as the tax levy policy itself, so again, it's inflation plus new growth. Uh that's sort of the baseline. So uh you can see inflation, we've actually used a number of 3.44%. That's a little bit lower actually than what you guys saw the the last time because we've uh we've sort of looked at it and and you know saw where inflation uh was going. It's it's not that far but it's it's a little bit lower. Um new growth again is 4.1 uh% uh which uh uh which if you were looking at just our baseline uh tax levy increase based on this policy we'd be at a 7.54% increase. Uh so based on just that for the medium value home in the community which is I believe $410,000 now or it's right around $400,000 uh the impact would be $78 per month or $85 annually uh for our operational uh levy. Um and then again under our new program or under our policy any new things then would be added on to that. That's our building program. We'll talk about that in a second. Next slide. So, our camp program, again, the purpose of this is to maintain our existing assets and keep them in good condition. Um, we put a million dollars uh towards this each year. One thing that we are doing differently this year than we have done in the last few years is we have not included an inflationary increase. So, a million dollars in 2017 isn't the same value as a million dollars now. So, we're going to start this year going forward is that we make sure that we're adding uh inflationary increase to be able to keep up with that. Um, so we'll use that whatever 3.5% uh number uh for that to uh to to give us the the total number. But the types of things it goes towards is, you know, again, street seal coat and overlay program, our trail surface rehabilitation, neighborhood park rehabilitation, uh some components of community park rehabilitation, and then we have all kinds of miscellaneous things out there. So, we have retaining walls and parking lots and sidewalks and all those types of things we use that program for. >> But this is nothing to do with community center. It's all >> this no nothing to do with community center completely separate. So in 2026 there's only two things we have scheduled. Uh one is the uh repaving of Bavaria road and you can see the red line going. So it's basically from the uh border of Chaskan Victoria all the way down to Pioneer Trail. Uh we were going to do that this summer but we thought maybe since every other road in town was closed that maybe wasn't a good idea. Um, but that's that's a $1.4 million project. And then we have we always put three miles of trail resurfacing into that. Uh, you may have seen over the last couple days they were out resurfacing like the trails. >> Yeah. Over by Southwest Christian. Since we're on that topic, Bavaria Road on that little there's obviously some new because of the righthand turn lane and left-hand turn lane and then there's new because of the roundabout, but there's also some pretty rough in between. When is that section of Bavaria going to get done? >> So, are you talking about south of Pioneer Trail? >> Yes. >> I'd have to find that out because we have it all on a sort of a schedule. >> Yeah, because I'd be curious because it's kind of like they're not big. Yeah, >> but there's definitely some like smooth and then it's really rough and it's smooth again and then it's really rough. >> A lot of times what we do too is um you know we plan for a section of road that we know we can get done for a certain budgeted amount and then we go out and we actually get pricing. >> Sure. >> And we're able to add stuff on. >> Okay. >> Uh so we we try to over underpromise and overd deliver. >> Yeah. No, I just curious. >> Would Angler not be part of this? Because outside the community center now with the construction and the new roundabout that is to from 41 over to Ottabon, it's just tore up immensely. >> Angler is >> So that's going to all be repaved by the county. >> Oh, okay. Yeah. Okay. >> Yep. >> Yep. >> Um and actually with that I we found out it's probably going to be right around the first or second week of November that's done. Uh so actually >> the whole project. the whole project. >> Oh wow. >> Uh so >> they've been working those weekends, evenings. >> They're out there. >> They're out there. >> Yeah. >> So we'll see. >> And then now when is that officially I know we're changing the subject, but when is that going to shut down there? I know they're going to open up. >> They're going to >> Are they opening one up before they shutting down or are they shutting the one down too and then opening? >> They're like going to open up the one at 8:00 tomorrow night and close down the other one at 8:01. >> Okay. Oh, so >> that's good. It's going to be pretty simultaneous. >> Nope, that's fine. I was curious. Okay. >> Yep. >> So, one thing you'll notice in 2027, uh we have uh we don't have a million dollars of projects. So, we're we're trying to balance uh the fact that we're doing $1.4 million in in 2026, but uh we still have yet to identify specifically what uh uh street seal coat and overlay. Uh there's additional pickle balls done uh Lions uh park that are uh proposed in that and then trail resurfacing. And you can see as we go down probably the one uh you know the next playground uh that we deal with is would be the Bav Bavaria Hills playground uh in 2028. It's the one that's uh where >> neighborhood >> it's the one where it sort of looks like the two neighborhoods should connect together >> but they don't. >> Yeah. >> Yeah. behind Symphony Hills. >> Yeah. Yeah. >> Yep. >> All right. Next uh slide. So then our building improvement program. This has obviously been a huge uh focus of ours for the last four years. Um you know, I won't go over everything in here. You know, there's we have facilities that need to be able to keep up with our time. This has been a strategic priority of the cities now for the last four or five years. Um we've done a ton of engagement type of things and obviously we're very close to having our uh first building completed uh which we got to see tonight. So as we go to the next slide, this is the order uh of priority that we put for uh different facilities. Uh number one priority was public safety uh because uh we felt that that was the highest uh need uh especially with our police department uh just given uh where they're located now is just not even close to being adequate for what our needs are there. Second priority is municipal service building. As you're aware, we did approve the concept plan for that at the last meeting. We're on schedule to uh go out to bid in the late January, early February time frame. Uh and uh uh if everything goes fine with that, then we would be uh planning for a May of next year uh construction start. Uh and then that's uh you know, it's about a 14 to 18month uh construction time period to get that completed. Uh the library is our priority number three. Uh what we we talked about this a couple meetings ago, but we're actually going to start sort of the process for planning for this a little bit earlier than we did with our other buildings because we're going to need a little bit more public input into this process. And that always takes a lot more time uh to do that. So, I would really envision that right right around this time next year is when we would see uh us start that process and probably have some type of a task force to to sort of help and and and guide and things that people would like to see our our library be. And then the fourth priority once we move the library out uh we'll basically reclaim the space within city hall to really have our ultimate build out for uh city hall and the different functions that are within this building. Uh next slide uh gives the sort of timelines. Uh you can see again the 2026 uh the MSB construction would begin. Um sometime in late 27 is when we would expect uh the uh construction of that to be completed. Um we would expect construction of the library to begin in 20 in May of 2028 and that would be completed in late 2029 and then we'd hope to be completed in late 2030 with the remodel of city hall. So that's sort of the timeline that we're on. And so far we've really stuck with these uh these dates. Next slide. This gives you a sense of uh sort of where uh things are at as far as the the costs for the um for the different facilities and then also then below uh the sources that we use. Um so the tax levy each year for four years we added the $1.125 million to to take that contribution and then the utility uh comes in because or uh utilities share these facilities with the general fund. And so it's really contributing their fair share to making sure that, you know, whatever we're building out for utility billing or uh water or sewer uh electric, we share one facility that they're contributing their fair share to that uh that number as well. And then this is one where I talked about new growth. You can really start to see the impact that that has had over time. So the first the one on the left is when we started sort of our first year of implementing that tax levy, we anticipated that for the median value home in the community that the impact would be $34 uh per month um uh for a total impact uh for all four of the buildings. Since that time when we look at 2026, that number has actually dropped to $30.50 per month. Uh, so it's dropped almost $4, uh, per month. Um, which doesn't sound like much, but that adds up over time and and represents from a percentage perspective uh, a significant uh, drop. And we we talked about this at the beginning. We said, you know what, again, it's let's let's over under over >> over >> underpromise and overd deliver. uh we did not want to put out numbers that all a sudden would come back higher in in the long run. Uh we wanted to to do what was the the case at that time although we understood that with growth that would probably decrease which it has. >> Yeah, I think that's an important call out that sometimes I don't know that we put enough emphasis on. I think this slide is very important to show. I remember sitting in those conversations and being like, well, if this is a lot of money um that we're looking to put out there, but how important it was, but also trusting our staff to you guys went above and beyond to really kind of do everything we can to do it really right, but also crunch the numbers. And I know you guys have worked very hard at that, but also it's about capturing the growth. And I think sometimes that bullet point isn't always emphasized enough that we really had unique growth over the last few years. And if we hadn't kind of captured that, these numbers would look a lot different. So I think there's always that big question of why now? Why are you doing it so fast? Why did it have to be four years in a row? Well, you know, which are valid questions, but I think really when we look at the growth we had some of those slides back, that's really what helped this number come down. Um, and you know, it was one thing for us several years to sit there and say and hope that that's what was going to be the impact, but it's it's really cool for me to see this now, um, and see finally be at that fourth layer and see that the the numbers have come down and we were able to capture that growth and and really spread it across the community. So, >> well, I think the other thing to to point out, we have a lot of industrial growth that's going to happen into the future. >> So, it's it's not like we're just stuck at this these numbers. those numbers are going to continue to go down each year. >> And so, um, I mean, to me, it's why it's so important for us, you know, to be focusing on how we, uh, how we maximize as much industrial as possible, >> right, >> uh, out in our industrial park because at the end of the day, that's going to be the thing that, um, really drives everything else. >> Yeah. And I also think too like in expanding and kind of we kind of threaded the needle in the sense that you know four years seemed like a sweet spot in terms of just the inflationary costs of building itself and just making sure that you know we were being you know good stewards of taxpayer dollars but also at the same time not delaying something that was going to inevitably cost more and something that we were going to end up having to do in the long run. And I think that's a really important point, >> you know, in regards to the touching on the growth that we are at that point of capacity and just ensuring that we're set for um the future. >> All right. Uh just a couple other items to note. The public safety aid, we we are going to finally use the rest of that uh this next year. uh some of the bigger items that we have like the we talked tonight about the simulator uh that's going to be in there. Oh, nice. >> So, stuff like that is what we're using the rest of our public safety aid dollars for. >> I mean, it was a great opportunity for us, you know, to be able to go into this new building and then have dollars that we were not expecting >> uh to be able to use those towards things that are going to make that facility even better. Uh so that so we'll be done after next year with those dollars. The one on the bottom is going to continue to increase each year. Uh so this is the 1% sales tax. A quarter% of that uh well 3/4 of a percent goes to transportation. A quarter percent goes to uh housing. Uh we received uh or will receive about $339,000 this year. Uh we expect that to be around $345,000 for next year. It really depends on how how people spend in the community. Um but um you know, we're sort of pooling those dollars right now, but I think this is going to be uh I think this could start to become a nice tool for us to be able to go out and have what I consider sort of seed money to partner with groups like the CDA, uh who really are good at going out and creating these affordable projects. uh and if we you know can come to the table with things to partner with them and and you you know use those to uh leverage other resources that they have to really create some nice projects. Um so I guess uh Elise wanted me to stop talking about that >> accidentally hit the button. >> I actually thought you were in controlling of your own slide and you were saying next slide and then you were pressing the button for the next slide. >> I actually thought Christa did it also. See, we have everybody fooled. No. Um, the other one, just a note, is the franchise fee. We're going to be building in some amount into uh the uh into the budget for this year. I think we targeted maybe like $150,000 or so. We don't really know what that franchise fee amount's going to be until we start collecting it. Um, but we will get something. Uh because if you look at Minnesota Valley, um you know, they have all of our new industrial south of Engler. Um we'll continue to have all of our new industrial south of England until 20 240 and they have all of this stuff up by Chvel and so there's going to be some dollars that come in there. Again, we're just sort of uh pegging a number at this point, but we'll be keeping track of sort of where where we see that come in >> and we're using that towards our um camp or my >> Yeah, we're we're using it towards uh what was it? The uh um Oh, I know. We're using it to help reduce some of the administrative fee burden of the community center to the general fund. >> Oh, okay. >> Uh because we want to we because we're still remember we'll be going through that, but we're still trying to build up those dollars there. So, >> I haven't seen the community center appear on any of these slides. >> No, because the community center is a separate fund from the general fund. >> So, we actually have I know 10 funds. >> Yeah. >> Yeah. You you guys will be seeing a lot more budget stuff. So uh so the all the like community center, town course, uh the loop, uh uh g uh I mean electric, uh water, sewer, uh storm water, all those are separate budgets. >> Yep. This is just the general fund, which is our general city services are supported by tax levy. The rest of those all have revenues that really sort of support them outside of tax levy. >> Got it. Okay. >> Yeah. Uh next slide. Uh just some things just to point out as far as uh additions in the uh general fund budget for next year. Uh we do have the CHASA today six additions put in there uh which has had really good reviews so far. So look forward to to getting more of those out. Um I'll just point out some of the big ones. We do have a comp study that we're in the middle of right now. uh we're sort of estimating what it's going to cost to implement uh some of the things to get us up to market with all of our positions. Um we do have a police officer uh starting on July 1st, which is our 32nd officer and then uh a co-responder social worker uh position. So this will be the first one uh position that we have that's directly related to uh dealing with some of those real challenging mental health type of cases that we have within the uh police department. So that'll start on July 1st. Um next slide. Uh the fire the big one there is that we'll be going starting January 1st to a 24hour uh duty crew model which means that out of anything we're doing in the budget this year, I think this is going to have the biggest impact out of all of them from a service level perspective that that people uh see. Uh because right now we only we run between 6:00 a.m. and 10:00 p.m. which means from 10 till 6. Um you know, we're running with people just responding to the station when they're getting paged out. the call time uh our response time is significantly better uh when we're coming directly from the station instead of having to come I mean it makes sense that coming from home to there so >> uh I think that's a huge uh huge one that we have >> um and then like our building inspections we have one a building permit technician uh who's retiring so we're put dollars in to move that to a full-time position because you've seen where building permits have gone on uh it's very busy. Um so the rest are are relatively small type things but um it just lists out everything that's a change from last year. Um and then this is our equipment. Uh so we have our equipment on a schedule. Uh so for instance our plow trucks are 20 years. Um our uh I think our pumper trucks are 20 years. So you we have we have seven years for a squad car. So there's specific number of years that we that make the most economic sense for us to be able to keep these uh vehicles and equipment. So this goes through and sort of talks about uh the different pieces of equipment uh that we have scheduled uh to be replaced uh next year. Um next slide has sort of a continuation of that. um you know getting all the way down to you know spreaders and airators um you know things that people don't necessarily think uh about but are things that are are pretty key uh to to keeping the the city and looking good. Next slide. So this gets sort of the brass tax uh the levy and the impact. Uh so you can see that our 2026 general fund and EDA levy would be uh just shy of $24 million. Uh and just uh I think I've mentioned this in the past to give you a sense our general fund only represents about 25% of our entire budget. Uh and of that um the you know the tax levy uh the you know the tax levy just represents a portion of that. Uh so um you know this represents just a portion of our total budget but uh it is an increase of 14.606% uh but the impact is less uh than that because of the new growth that we've seen in the community. So you can see a median value of home in 2024 was $390,000. That house uh that same house in 2025 would pay $1,533 per year for uh taxes, city taxes. The median value of home in 2025 has gone up to $410 $400,000. Uh so that uh uh home this year or for next year would pay $1,75. So it represents an increase of $14.33 per month or $172 per year or an impact of 11.22% increase for that uh home. So of that I always break it down the baseline. sets. Our general operations represents $85 of that and our building program represents $87 of that total amount. Uh, next slide. This just gives you a sense of sort of a a breakdown of uh uh where uh your tax dollars go as far as school uh county uh and then city and others like mosquito control and stuff. Um the uh so this chart really sort of gives you sort of the same numbers but uh gives you a sense of that red represents our building improvement program and you can see what portion of our levy uh so in 2026 again that's our last year of our building program. Uh so for that uh you know facility debt service on that medium value home uh $1338 would go towards our general city operations with $367 going towards debt service. But that's not just debt service on public safety. That's debt service for all of our uh future buildings. >> So does none of the the slide before the dollar bill? None of it goes to state. That's all from income tax. None of our property taxes are paid to the state. Well, uh, unless you're a commercial industrial property. >> Commercial industrial properties, their property tax actually pays for a, uh, the state portion of school funding. >> Okay, >> that happens. It used to be that all school funding was done at the local level, but there is, uh, commercial industrial tax now that goes towards that, but there is no residential property, >> like roads and plowing and all that. That's all from income tax. It's nothing out of property tax. >> No. Well, depending Rosen pawing for us, our services all comes from property tax. I'm thinking like 41 and like >> 41 that all comes from income tax. >> Okay. Interesting. I didn't know that. >> Yeah. >> And then this gives us a sense of where we are. Uh so there's 84 uh cities in the metropolitan area that uh uh we compare to. We're number 53. Um and that puts us at the lowest 63% uh of cities in the metro area. Uh to give you a sense, when we sort of started this program, we sort of thought we'd sort of end up in the middle uh of all the cities and then as we continued to grow, we'd start to see ourselves go back closer towards the bottom. Uh so we've actually probably performed a little bit better uh than what we had anticipated when we started the program. Uh but again, we're still lower than the median uh uh property tax levy per capita in the metro area. Um, and again, we're in the lowest 63% of of cities out there. Next slide. This just gives you a sense. So, by September 30th 30th of each year, uh, councils have to adopt their maximum tax levy. >> Kind of cutting it on fire here. >> Those too long. You missed it. >> Yeah, I know. Uh so uh you so when we set the maximum tax levy um you set it you have the ability to lower it before the final levy is uh set but you do not have the ability to raise it. What they the reason they set September 30th as a date is because they want to they send out their truth and taxation notices in November. And so that gives them plenty of time to be able to put a tax statement together for each property and send it out and say if these taxing jurisdictions pass what they are talking about this would be be the impact on your home. Uh so that's the purpose for doing it today. So we have to do that uh during October and November. So the nine other funds I was talking about that's when we'll talk about that. Uh, in fact, I think it's October 20th we're talking about the recreation uh funds. That'd be the community center, curling center, and the two golf courses. And it probably will be the second meeting in November when we talk about the inter uh utility funds. So, we try to group those two together. Uh, December 1st is when we have our truth and taxation hearing. So this is when people have the ability to come and make any comments or questions or anything like that on uh on uh the what's being proposed. No decision can be made uh on that night. We just take input and then December 15th is when we would adopt the final levy uh for 2026 uh and then establish our budgets not only for the general fund but all of our utility funds and then set rates and all that kind of stuff. So that's sort of the what you can expect for the schedule going out for the rest of the budget here. That's it. Is there any questions? >> Any questions for for Matt? I mean, I think it's good to remind the folks that are watching this that we've had two work sessions on this so far this year. um just as we've had we have some new council members to our budgetary process just kind of bringing them up to speed but then also just getting more real time numbers I think was the second time we had kind of a refresh of everything and so you done a very thorough job tonight I wouldn't say we brushed over it but if we don't have any pressing questions during this time it's not because we don't ask questions it's really just because we've seen this material um three times now And so uh it hasn't really changed since the first time. Just numbers here and there maybe. But >> I think the other thing to point out is nothing's changed from last year's discussion. I mean that's uh we've really had the same discussion now for the last four years. >> Yeah. And I mean like you had said I mean you talk about the four different budgetary priorities being the capture of new um growth and inflation with our tax levy policy, the camp, uh building of our general reserve fund and then our um building program. Those are kind of the four major entities that we are um you know utilizing with our tax levy. Uh, I think as we go back and talk about, you know, just earlier today, even just the visitor presentation that was in here and winning that award for having the best tasting drinking water is more than just, hey, our drinking water tastes really good. It's also very safe to drink. And I think kind of go back and just as a reminder that the importance of these services and the facilities that maintain these services that that they're well cared for and well funded um is really a reflection of the priorities that we're kind of putting forward with this tax levy. uh this year in this in our building program with having our municipal service building. Um next up to kind of be um you know adequately servicing our community with the amount of fleet and staff we have on and then obviously the finishing of our public safety campus and then just the uh library just in terms of enrichment in our community and the you know amenities that our uh community members really um request and desire to be here. And then finishing that out with the city hall, just the growth within our city staff and the and the need to have um this building be utilized. I mean, we have uh departments that can't be here physically in the building because there's just no space for them. So, >> we we've just gone through two interview processes in the last three weeks and we've had to do them up at the community center because we >> I'm sure that makes people want to join this. >> Yeah. We don't have any place to actually hold interviews, >> right? And that's not necessarily like the most quiet space to hold interviews because it's a recreational center. And so, you know, it's um I think it's just important that as we grow as a city and our services grow and that people that move out here have a level of expectation and uh desire to have good services, they want to be able to flush their toilets, turn their lights on, and be able to get to and from work when it snows. and all of the is said above um that these are things that are important and as part of our budgetary needs and so um I really want to make sure that that gets touched on and then also that this is the maximum that we can go out for we can have discussions as those statements come out and as things um come into fold that if there's something that needs to be shuffled around that's not that it's not off the table it's just that this is the maximum that we can go out for. So, there's still many more discussions that could be had on that topic. And that's my welcome to my TED talk. >> And I'll just add, you know, as a new council member, um what got me to actually think I should run for council was some of the public safety concerns and the tax increase last year. And then as I after I ran and got elected and all that, I actually came to speak last year at the taxation December meeting um to say that I thought my taxes went up too much. And by the end of the presentation that day where you were walking through all of it, I had to back my comments back down. Um, but I think it's really interesting. We we like to say our taxes go up and we like to look for someone to blame. And I get that as a residential homeowner. I don't like to pay any more than anyone else does. But when you look at the services you are getting for those dollars in the city between all of the recreational things like town course and loop and community center and then you know the idea of our police are operating out of a building that doesn't have an evidence room or doesn't have a question detention center any of those kinds of things you're not really operating at the standard you expect them to operate back at. So building these buildings and doing it for the cost that we are of what did you say $75 a month or something is really inexpensive. it's no more than groceries or gasoline or anything else is going up. And with that, you're expanding to a 247 duty crew for fire and you're adding, you know, all these great amenities that will make this city not only more attractive, but more safe for those that already live in it. So, when you start to think about that, yes, your taxes go up partially because of the school and we talked about last week, we should be educating our young. So, we should vote yes for the referendum partially because of the county. So not sure what they do, but it really is important to make sure that your city maintained amenities are maintained well and that your, you know, staff is cared for. And so after I have been on the council and seen some of these presentations or read the materials more, I really don't think you can complain about a less than $100 increase a month. It's it's very, you know, as the like Taylor said, as the city grows, you're going to need more and more. So it's really expected. Yeah, I think it's too it's reflective that these aren't I mean some of the things are amenities but a lot of it is very essential services. >> Yeah, I think that's when you call 911 you want a fire or a police or an ambulance to be there. >> That's why again I I think the most significant thing that's on that talking about make sure other than the buildings that need to get addressed is the dollars going towards the 247 duty crew. Yeah, >> that to me that's a significant service enhancement. You know, probably second on that is, you know, being being able to put in a the uh >> training facilities, >> social worker uh position into uh into our police service >> uh which is, you know, most bigger departments are doing that because there's a real need to do that. Yeah, >> I think it would be really interesting too and not to put any, you know, pressure on Ryan, but it would be really nice if like maybe there's a visitor presentation that he does in the coming weeks that shows the upgrade this new facility will have from what they have now. So, when you talk about state-of-the-art training facilities and simulators or you talk about evidence locker rooms and vaults and, you know, the things that we don't have today, it's not just a massive pretty building with upscale offices. It's actually, you know, going to better the interrogation process, the witness protection process, the training process, the, you know, all the vehicles will be inside so they're warm when they're ready to go to a call. So, just all those things that >> he was walking us through today are very informative and give a good reason why we're spending, you know, almost $40 million on a new public safety building. Yeah, I think the fire department that's extremely important on two levels obviously for level service that the the response time to calls is, you know, vitally important. Minutes matter. Um, in regards to if it's a medical or if it's actual fire. uh but I also think as like a recruitment tool you know I think >> you the paid on call model is a model that is >> challenging in today's environment with people's work schedules their family obligations their um their own personal obligations and so being able to actually be scheduled and know when you're going to be working and when you're not and have that sort of structure and and knowingness I think is very important for uh that recruitment piece of things as you know I know a lot of fire departments struggle to bring on um new um uh fire department uh firefighters as you know others retire out and and in a growing community you need more too. You know it's just you know these are you know basic math right and so this is all kind of everything is intended to have there's a reason behind that. It's not just like you said pretty things and you know bells and whistles. It's like >> this is very important for the functionality >> and we didn't really see it today but that training wall if Steve could come in and talk about like that is amazing that they can practice breaking and out of windows and both con you know commercial and residential and just like the simulator for the police. There's so much that if you know people saw the behind the scene behind the scenes tour that we just got today, you would understand why this building may be expensive but also is so necessary. So >> yeah, it would be great for community. >> Yeah, I think um I always like to just pretty much everything that's said, but also just remind people at least for myself and I don't want to speak for everyone, but I'd guess they're similar. Um this isn't something we take lightly. We River City Days is a good example. Get to talk about these things with all the residents to kind of have those conversations and hopefully come to a better understanding and usually we do of why do we have to do this? Why is it important? And knowing that, you know, it's it's our neighbors, it's our taxes, too. Um it's there are seniors on fixed incomes and and you know, with inflation, everything is more expensive. So this is not an easy thing to do and like I said it's not something we do lightly. We really look at the community and say is this going to make it better? Is this going to be a better quality of life for our residents and have that vision that's sometimes difficult to have that vision of knowing being able to look a little further be willing to look a little further and say once we get there this is really good you got sometimes we're asking you guys to trust us to come along for the ride a little bit. Um, and certainly when we look at double digit numbers, even in with the tax levy and with impact, that feels like a lot. And just know that it's it's not something we're doing flippantly. Um, you know, mayor touched on it. We we go through these several times, these presentations, we really think about it. And even back to um, you know, prior councils when we look back to, you know, I think we started these conversations in 2019 or even earlier. um they started earlier but 2019 was where I think we really started to put like dollars down to really look at it and I remember those conversations they were hard and we've had to kind of stick with stick with it and certainly it's not always been fun but really it is what's best for the community and I think we can all stand behind that and be really proud of the community we live in because of that. So I just like to mention it's not something we take lightly. Um so it's something I personally lost sleep over. I live on one income. Um I think I've talked about that before and certainly um understand the impact every every dollar has. So I just like to mention that. >> Yeah, I think that's really important. Thank you for adding that. >> Yeah, I think well said. Um I don't take anything for granted. You know, numbers are important and I appreciate putting the numbers together, but also recognize that every, you know, dollar impacts someone differently, right? And so um for some people that's Yep, that makes sense. I can handle that. Others that's going to be a challenge and I and I respect that. >> I also like I'll just say that this is the time of year when this will get published and I suspect even as early as tonight there will be posts on our social media worlds about high inc taxes and those are welcome and responsive, right? I just encourage people read, watch this council meeting back, look at the material, reach out to us up here to ask those questions. Uh because I think I will say I'll just say it's popular these days to fearmonger taxes in social media, right? like and you know I I really appreciate you sharing your honest >> reflection because I do think there is a lot of that where we just don't know and it a big flashy number and then you listen to other people and they're and and again generally people mean well >> I say generally I think there's probably a few social media worlds that sometimes you look at this like they don't even live in the city and they're commenting on the city taxes right that's always interesting um but a lot of it just gets because you just have pieces and you try to pull together reach out to me, reach out to any of us up here. Um, don't take it for granted, but yeah, I think um, you know, the thing that always resonates with me was when we went for the first vote for this. Um there was lots of conversation in particular like I just I just respect and understand like the like why do we need this giant safety center and and so fancy and you know people are it's going to raise their taxes and people are going to leave the community and I and I just reflectively say that is a choice people can make but I also look at like people choose to stay in communities because they have a fire group that's going to respond and feel safe >> and it comes down to taking care of the people that take care of us when we're most vulnerable too right Um, and so I I always remember that comment because that resonated really well was all this conversation like people will leave. And I said, but people will also leave if you don't take care of the stuff we need and rely on, right? So that was always that balance to me. You know, again, you're not going to ever stop someone who purely makes a decision where they live based on a tax burden. >> You're never going to win that battle because someone's gonna there's going to be a city that has less taxes somewhere, right? But what you provide and that value, that perception of that value, it is the long game. And so I've always just remembered that because again, it's going to be now until that final vote, I'm sure we'll see a plethora of of posts and, you know, even the Star Tribune and and you know, those newspaper will pick up different cities and there'll be a comparison and and again, just take the time to ask, educate yourself. Uh, and and you still may be upset with it and that's okay. Um, but take the time to understand and un reach out to us if you need to. >> And I think the last thing I'll say about that is put it into perspective because 87 or $89 a month. I know I personally pay to belong to Lifetime. We use it quite often and the dues went up for a family of four $67 this year to continue to use the club as is. And I have my children in private school and the tuition went up $620 this year to continue to provide them that education. So everything goes up, but if it's of value to you, you will find a way or you will at least understand why even if you don't like it, it goes up. And this is a very small increment if you look at lifetime at 67 and it's athletic club versus the city you live in and the police and fighter response. So anything >> I think it's all been said, >> you know, >> man, a few words over to my right here. Um, yeah, I feel like we've talked and discussed this at length and I think we all kind of um, you know, are welcoming to conversations from our constituents that, you know, if you have questions about this, we're happy to answer those questions. We're happy to have those conversations um, for better understanding. I think that is always the shared goal is I think the people that reach out and and reach out to us either via phone or or email or in person, they want better understanding. Um, and I think that we are wanting to give that to them. And so I think that that is very much a common and shared goal. So um, with that being said, I think we have to pass this thing. And so I think someone has to make a motion to pass the um, adopt the uh, resolution number 2025-68, the proposed assessed 2025 payable 2026 maximum property tax levy. So moved. >> Okay, we have a motion from council member Gra. >> Second. >> A second from council member Hatfield. Any other discussion? >> All right. All those in favor say I. >> I. Opposed. >> Motion passes. >> The one quick thing I'll point out is we'll have a quick EDA meeting where you guys will also have to set the EDA levy, but the impact that I showed you guys included the EDA levy. So it it doesn't change it any. It's just that you have to approve them separately. >> Go through the whole presentation again. >> Yeah. I'm requiring you to >> might not be after midnight. Poor.