[music] Heat. Heat. [music] [music] >> [music] >> Heat. Heat. All >> [music] [music] >> right. Good evening. We will get started. It is uh Monday, August 17th. This is a study session of the Minnitanka City Council. I'll call this meeting to order. We'll start by doing introductions. We'll start with Miranda. >> Miranda Diamond, assistant city manager. >> There it goes. Eric Nelson, city attorney. >> Darren Nelson, finance director. >> Mike Funk, city manager. >> Kimberly Wilburn, city council at large. >> Amanda Maxwell, council member. Ward two. Rebecca Shack, Mayor Kotton, Ward four. >> Deb Calbertt, at large Cday. Paty Foster, Bolton, Ward One. >> Will Manchester, public works director. >> Julie Wishan, community development director. >> Kelly ODay, recreation director. >> Kevin Fox, fire chief. >> Scott Borman, police chief. >> Jason Tate, deputy chief of police. >> Derek Mezer, deputy chief, fire department. Sarissa Saraki, senior management coordinator. Sarah Westy, assistant recreation director. >> Kevin Ringhoffer, resident. >> Tom Stockard, resident. >> Great. Thank you. And before we get started on the agenda, um Kimberly is just going to make a couple remarks. Kimberly, take away. >> Sure. Um I just wanted to lift up the Hopkins community um as they're they're grieving the loss. Um they have a vigil [clears throat] going on right now that we hope I'm sure would have been at if we had been able. Um remembering the uh daycare provider and her daughter who were tragically killed last week. You know, h uh council member Gerrio, her daughter is a was a friend and classmate of the little girl that was killed. And there there's just a lot a lot of grief going on right now. And um it's so [snorts] in incomprehensible um and as as one of the friends of the of the daycare provider said like we've had too much loss and so just want to remember them. >> Thank you Kimberly. appreciate [clears throat] those comments and just want to acknowledge that we also had first responders at the scene. Very traumatic and we our thoughts are with them too and having to all of everybody who experienced that um having nobody should have to experience that and so um we're sending our thoughts to all those folks. we will shift gears and we will get to our primary agenda item tonight which is the preliminary 2027 budget review and I'm going to hand it right off to Mike. >> All right. Thank you Rebecca. Good evening council and our guest here this evening and anyone that will be listening to this later. Uh as the mayor teed up tonight is our discussion on the preliminary 2027 budget. Mainly we're looking at our general fund. And so Darren and I have a slide presentation for you this evening. We have about 34 slides. So we'll try to move through those pretty quickly. So that way we can get to uh the conversation at the end. Uh just kicking things off just to go ahead and dive right into it. We did have in the staff report three questions uh for the council to answer at [snorts] the end, but I want to just prime those here. So, as you're listening to the rest of the presentation, you have these in mind. The first question is, does the council support a base property tax increase of 6.1% which includes 1.6% for the continued implementation of the public safety master plan? The second question is, does the council support an additional 7% for facility improvements related to the fire station 2 and excuse me, relate to fire station 2 improvements for a total levy of 6.8. [cough] And then last, does a council agree that a total of 225,000 should be certified as the HR preliminary levy for 2027, which is the same amount presented at the EIP study session here recently in July. So those are the three questions. Moving on then into the presentation. You've seen this before, council. This is our timeline. Uh we do illustrate this for a couple purposes. one just really acknowledging the amount of time and effort that goes into our annual budget. We do we I say we collectively as staff and you as a council uh do spend considerable time really looking at and being careful stewards of the of all of the monies here in the city. So here in August 17th is our general fund and priority based budgeting conversation. If recall the color coding on this uh the the largest X which is in green the primary focus of tonight again is the general fund but we will touch on a little bit of our special revenue funds our debt funds and then capital project funds. That'll be kind of in the analysis. Uh moving ahead uh certainly in September uh at a council meeting uh you as a council will need to adopt the preliminary levy and budget. So that's why we have teed up the questions for tonight as we get ready for the next conversation in September. Then in November, we'll do an all funds uh at the study session, including our enterprise funds. And then on December 7th is our public meeting, our budget and levy adoption. We do have an alternate date proposed on December 21st in the event that we need more time. Again, you've seen this slide before. Uh this is 2026, so it is our current year city budget. We do illustrate this just to demonstrate where all how all the funds are connected. Uh this will get updated as we continue to have conversation in the upcoming months and then in December we'll have all the new numbers plugged in for 2027. Uh for uh illustration purposes again this is the all funds. Uh so if you ever get asked well what's the city's total budget in 2026 is roughly 124 million. We demonstrate our budget really by kind of two separate buckets if you will. On the first on the left hand side of this graph is what we call our governmental funds. These are our our funds that are supported by property taxes. Uh the on the left hand side of that is the general fund. That's [clears throat] got the big bright circle around it. Uh that's again where we'll spend most of our time is a general fund. Uh I think you've heard Darren and I speak before. The general fund is where most of our taxes go. Uh so in in terms of the $124 million budget in 2026, each of these funds then have some had the more specific dollar amounts attached to those. So for the general fund this year, 60.1 million. Again, that's where we'll spend all of our time talking about just the different operations. And that's where I want to just also acknowledge uh as our introductions earlier. Our department directors are here along with many of our assistant directors uh as part of this conversation because they are instrumental in working with Darren and I as we pull these numbers together. Uh other uh we'll touch on again special revenue accounts and then our capital project funds and debt service here this evening. And then as I just noted on the previous slide, the enterprise funds, that purple circle, that's where we'll touch base really in November. So we'll continue to pull all of these different funds together. I was going to pause here, hand the microphone over to Darren real quickly. Uh again, our strategic plan is instrumental also in these conversations. Uh Darren does lead our uh pillar in this regard. So I'd like to have just Darren just spend just a minute uh just talking about how our strategic plan aligns with this process. Thank you, Mike. Uh, good evening, mayor and councel. Um, obviously all of our six of our um strategic plan pillars relate to the budget. The budget is driven by the strategic plan. Um, everything we do with the budget relates back to that strategic plan. Um, but really want to kind of pull out the financial strength piece of that because it's directly related to preparing and u forecasting a budget piece of that. And so there are desired outcomes within the financial strength um priority. And so we have three of those. And I want to talk a little bit about um just those desired outcomes quickly. Um one of them is to improve alignment between service expenditures and identified priorities. And so we've been talking about priority based budgeting over the last probably half a year or so on that end of it. And we are making progress on that. We've identified the programs. We gave a little bit of an overview of that at the kickoff meeting. Um and from that kickoff meeting um it became aware to me that we have to do some more peer review of those programs because we don't have costs um allocated those programs quite correctly at this point in time. So we want to make sure that costs and um both uh and the priorities and the evaluation of the program are done [snorts] accurately across all departments so we're not making premature decisions about a program before all the information is accurate on those. So, um, probably won't be touching too much on priority based budgeting again tonight, but obviously we have programs that relate to priority based budgeting. Obviously, public safety master plan is a a program within our budget, but um, as this as the year moves on and we get into that November time frame, we will be touching more on the priority based budgeting piece of that and how that influences on the development of the budget for 2027. So, wanted to touch a base on that a little bit. Um, and that's still a work in progress piece of that. And so, that was the first desired outcome. And another one is to um expand our sources of revenue for capital improvement projects. Um and you can kind of see that and you'll see that over the course of the last couple years that grants have really been a big driver for us across both operating and capital um projects on on that end of it as well too. So, we have um that's a big piece of it, the grants piece of it, and then also the sales tax piece of it that we've been working on over the last uh half a year here as well too and obviously didn't come to fruition with this legislative session, but um plans in place again to try to get that to move forward for next year on that end of it. Then obviously the last desired outcome is our high level creditworthiness and that's where we want to maintain that AAA bond rating um and doing making sure that we're planning and making sure that appropriate fund balances are in place for both general fund and utilities um all those types of things um are set up set us up well for um continuing with that high level creditworthiness and maintaining that bond rating. So >> all right back to Mike. >> All right, thank you Darren. And before the next two slides just touch on our communication [clears throat] strategy. I just want to touch on this before we really start diving into the numbers. Uh we take communication obviously very seriously here at the city and we encourage uh engagement from from the public. Uh we do that through a variety of different means. Uh one is obviously through the Minnetanka memo. We do budget articles in our Minnitankka memo. So we'll be highlighting articles there. We have our citywide email list serve system that that touches uh tens of thousands of residents through our citywide emails. We also utilize Minnetonka matters and we'll be getting that that's up to date and we'll be updating Minnetonka Matters between now and the end of the year. And then all these comments that we do get through these different various channels, we do share those with council. So with our upcoming uh formal meetings in September and December, we'll be passing those comments on to council. The other u other way we communicate is the truth and taxation notices. those do get mailed out mid November and then we as a city have an opportunity to to have a one-pager uh in that truth and taxation notice. So we'll also be communicating um with residents and all all residents that own property in the city do receive that truth and taxation notice. So it's another way of making sure we have a far-reaching uh impact uh to residents regarding uh the budget and this process. And then as I mentioned just in September December that's when the council receives formal feedback. So you'll be getting I assume emails along the way. will be sharing correspondence with you and then the public will have an opportunity to uh be in person to the council in September and again in December. Uh this just quickly illustrates [clears throat] uh just what that communication looks like. Uh so again, we rely on our communications team to really help us promote and educate residents on our budget process. So again, this kind of gives you a quick snapshot of what that looks like. Now, let's uh let's really uh dive into some of the numbers and really just want to start with the budget drivers and that's really what this slide is intended to do. Uh this was in your packet and at this moment just would really want to walk through what those drivers are for 2027. Uh the first part of this is what I would call our continuity of operations to support our excellent service delivery. And so as we look at our continuity of operations, the first line there is called city property taxes, current services. That's increasing about $300,000. That's where you'll find uh some of our contracts perhaps like with Lois, uh fleet maintenance, dues, and subscriptions. So that's some of the uh inflationary costs that are passed on to us. Other expenditures that we see with some of our operations are in what we call I don't want to call it a catchall, but that's really kind of reflective of some of those costs that we see increasing and we're accounting for those in that uh form. Really what's driving what I would call our continuity of operations is then related to staffing. Uh so we have our market and salary adjustments, union contract uh requirements, and that's about 1.5 million or 2.6% 6% uh levy increase health insurance which was noted in again the staff report. We did receive preliminary information from Medicica who is our current insurance provider that our insurance rates are going up 24% for 2027. That has always been a shared responsibility between the city and staff. We do split those cost increases 5050. So the employee picks up half of that increase and and the employer us as a city picks up the other half. We are going out on the open market. When I say we, uh Miranda Diamond, our assistant city manager who leads our HR department and our HR manager working with our broker, we are going out for bids and so we'll have those bid results in the coming weeks. Uh I think is what we anticipate and we're crossing our fingers and optimistic that we'll get better bids. Uh and as we get to December, as you all know, whatever levy is u approved in September as a preliminary tax levy, that can go down in December. So, we hope that's the case here with health insurance where as it is today, we're budgeting in that 24% uh as worst case scenario and hopefully then that number comes down as we get bids out on the market. Um and then a bit of good news on workers compensation. We did see a reduction in our workers compensation of 296,000. So that's decreasing the levy about 0.5%. So we've had a good experience in terms of workers compensation. Just some factors that led into that and so we're pleased to announce here that we are seeing a reduction in that cost. If we rewind the clock a couple years ago, we actually had a substantial increase in our workers compensation. So we're seeing a return or seeing a reversal of that going into 2027. So overall what I would call again that continuity of operations again primarily around staffing at that 3.6%. The next budget driver is the ice arena and the marsh. What we're anticipating or recommending for council consideration is an increase in the levy of $50,000 to help support those two operations. Uh there's we can certainly get into more of the details of that uh coming up. right now. Just want to just mention that we're 50 looking for $50,000 for that um for those two enterprise funds. That 50,000 is.1% increase in the levy. Uh and then here recently at a study session, we had our capital improvement plan discussion. Uh that's anticipated to increase $500,000 in needed levy. That $500,000 in levy increase is8%. I'll show a graph here in a little in I think it's in a slide or two that showed some es and flows with our CIP and how the levy has fluctuated a little bit over the last number of years. Uh and then public safety investments. So with our public safety master plan 974,000 as indicated in the staff report that largely evolves around hiring six new full-time firefighters as part of the recommendations in our public safety master plan. That again is 1.6%. And then last um this relates to one of the questions that we have for you this evening is our facility improvements. Uh last year I'm sorry I say last year 2026 this year for this year's levy uh it was kind of phase one of the step in. So for 2026 we had levied 400 roughly $400,000. This is year two of that facility improvements of 405,000 that is also.7%. So when you add all that up uh the total city levy of 6.8% 8%. And then when we consider the HR levy, which is the final question that we have teed up for you, staff was recommending a reduction in that levy from 300,000 to 225,000. Uh that is has a slight savings of.1%. So that gets us to a total city levy of 6.7%. If we rewind the clock from a year ago, uh we had do as we always do some forecasting, we were closer to 9% about this time last year when we're doing our forecasting. So, we're again as as we get better numbers and get more real numbers, we're at 6.7 here this evening. [clears throat] So, taking a quick look at uh revenues and expenditures. Hopefully, you can read some of that. Uh if uh on the So, there's three circles piraphphs there. Certainly on the left, it's the revenues. Uh the projected property taxes represents for the general fund 40 >> 70 78 >> 47645. >> Oh, gotcha. >> Is that right? Yeah. >> Yeah. I thought you were saying the percentage >> and the percentage is 78%. So close to 80% of our revenues are really tied to property taxes. We do have other revenues and later at the very end of the at the presentation we'll cover the one pager that was in your staff report with the revenues expenditures but breaking that down by percentages again property taxes the largest uh contributor in terms of revenues we have user fees and charges licenses and permits that makes up about 7%. We do anticipate a little more revenues coming in next year on that front and again we'll get into that a little bit more later. uh we have some transfers, intergovernmental revenues, other incomes, interest earnings. So again, gives you kind of a quick snapshot of the revenue sources for our general fund. And then breaking down our expenditures, we the middle pie chart takes a look at expenditures by program. The very right is expenditures by category. Expenditures by program. Public safety is the largest piece of our expenditures uh at 40, I believe it's 46%. That's not uncommon. uh cities generally and not not just Minnetonka but all cities public safety generally is the largest expenditure 45% 46% is very common is what we see in expenditure so we're very much in alignment with what other cities are in terms of that percentage uh the next largest expenditure is in our general government that covers a lot of categories from admin community development finance of 9.6 6 million or 16% street utilities at 15% or 8.7 million. Next we have park and envir park and environment at 5 million which is 8% recreation at 4.7 is 8% and then development is 4.1 million or 7%. So again kind of gives you a snapshot of where those monies go by program and then by category which is the right hand pie chart. Personnel makes up the largest percentage of our expenditures. We're in the service industry. I think you've probably heard Darren and I say over the years that personnel is our largest expenditure which is around 78% or 46.975 million. >> And just to reiterate this is the general fund and so if we look at the CIP those charts get are different than because public um uh streets and utilities and would take on a bigger part of that as we have more costly infrastructure projects on that end of it. So yeah, thanks for the clarity there. And so again, a very good point to emphasize. This is again just general fund only. Uh looking at at our 10-year levy history, uh this again breaks the levy and gives you a snapshot of how the levy compares between our CIP, our operations, which is the orange. Again, CIP is the blue and debt service is the gray. And one things I just want to mention with the CIP as noted in the pre in the previous slide or two previous slides is that the CIP levy is an increase of 500,000. See if the mouse works here. So the CIP levy uh which is probably really hard for you to read is 9 million6 9,363400 which so 9,6 363400 uh in current excuse me current year is 9,363400 uh we're anticipating that to go up 500,000 uh in 2025 that number was 9,876 in 2024 9 million 883. Uh 2023 9,173. So we've had a little some ups and downs in in terms of how much we're levying for our CIP levy. Uh we're getting actually back to kind of more of that 2025 number. So we did decrease that from 25 to 26 and now looking for uh increase of 500,000 from 26 to 27. This year again you've seen this before. This is our levy projections. We are currently again here in 2027. Oops. Oops, I forgot. 6.8, you know, 6 point saying 6.8. There's just some rounding in here. As you project out in future years, 2028, uh, 8.1%, 2029, 6.8%. And then out in those outer years is when the public investments in the public safety master plan come to fruition. And so we're seeing a leveling out of the tax levy in future years. What what is circled in in here is the where we've made those public safety improvements. As you know, council, generally we've seen uh one and a half to 2% in our levy increases due to those investments. And with those investments, we think including is what you see occurring here in these outy years. The reason that you see a little higher number out in 28 and 29 is because we we're trying to spread out those personnel costs with full-time fire. So, we're we do mid-year hires. And so, as you do mid-year hires, even though we're getting fully hired, there's another year of lag in terms of getting that fully funded. So, that's how we're trying to spread out those costs even further. That's why you see a lag in those outer years. At this point, I'm going to turn over to Darren um as we get again kind of more granular now into the details and to what is driving some of those higher level costs that I had mentioned in these previous slides. Before we do that, just again some more historical context and some perspective and context as to where we are as a city as compared to some of our neighbors. So, with that, uh Darren. >> Yeah, absolutely. Thank you, Mike. Uh most of you have seen this slide before. We've showed it over the last uh two years on on that end of it, but it's a historical look over the last 20 years of where each of our comparable cities levies have been for each of the last 20 years. And each um year is signified by a different color within each um bar basically for each city on that end of it. Um, for Minnetonka, we've been kind of the philosophy over time is that we want to make sure that our levies are fairly stable. That we're not seeing big spikes one year and then a drop the next year, then a spike up the next year. Trying to keep those levy increases as moderate as possible and not having fluctuations from one year to the next. And so we went when we went back initially and did this review, it was it was kind of crazy is that Minnitonka statistically was like right on the median for those 20 years of of levies across all those 20 um all across all those comparable cities. And we still you can see that we still are within that are still in kind of that range of being right in the middle of where everybody is at. Uh the 20-year average um aggregate levy increase is 99%. So each if you added up each year's levy increase for um the average it'd be 99%. Minnitanka is slightly under that at 94%. U I drew a line in there to show kind of where that 99% is at. And if you see over to the right like Egan and Burnsville, they look like they're higher than us. Um they actually had a couple, you know, a couple years back in like was 2012ish or so where there was some negative. The levy actually went down. So you got to kind of add those numbers together to kind of get where they're at um in totality. So they're actually a little bit lower than us u in comparison pieces of this. So the highest are on the left and the lowest are on on the right on that end of it. Um but just wanted to it's just kind of a chart just to I don't know if it says anything or not, but it just kind of shows a little bit of of data with our comparable cities on kind of where we're at over um historical long time frame on that end of it. And then here again is that same data just in a different type of different type of chart. Minnitanka is the kind of the thick blue line in there. And you can see there's lots of ups and downs each one of those years. And if you can follow, you know, like if you follow some of these red like the red lines on the left, it goes up to over 15% and it drops down to a decrease one year and up and down on that end of it. Where we've been really cognizant about our planning and forecasting and trying to make sure that our levy is staying um fairly fairly flat on that. And that a good example of that is the public safety master plan where we're trying to make that fit without having a big spike in any one year. And granted, they've been heavier than where we typically like to have them, but we're implementing a new um level of service as well too. And so um it's really important that we try to try to keep that moderate um for us on that end of it. So [clears throat] and then uh wanted to bring in our community survey as well. So, these are community survey results that we saw back in May. Um, just want to make sure that they're, you know, in front of us during our budget decision times as well, too. And so, um, we look at the there's just a handful of questions there that kind of directly relate to the to the levy and to taxes and to the u kind of the public's sentiment about um the value they receive for the taxes they pay and those types of things. And you can see the first question there when on uh question 27 when you consider the property taxes you pay the quality of city services you receive would you rate this rate the general value of the city services as excellent good or only fair and you can see that excellent this 13% good is 68% um those numbers have been fairly uh fairly sim are similar from year to year on that end of it looking back at 25 excellent was 12% good was 76 and fair was eight. [clears throat] So you can see that um fair is is jumped up a little bit and good has come down a little bit and so probably a little bit of that public safety master plan and just some of our you know multiple years of of this is kind of taking a Wayne on the public a little bit there. So um and then if you then it just shows the different areas of if you could increase the the budget where would you put your put your dollars and public safety is a high one there along with streets and parks and trails as well too. And the would you favor or oppose an increase in your city property taxes? Um favors 80% and opposes 18% and that has been um fairly consistent from year to year. I think I got a a graph on the next page here that um kind of shows that that history of that. Um I know previous mayor was curious about that to see if that was you know changed over time and such like that. So which is a some good data to know as well too. So um yeah, you're ready. Yep, you're fine. So you can see uh here's that same question just in how the the answers are and say the favor has stayed fairly level on that end of it. Um the oppos has grown a little bit and we're um don't know or refused is decreased a little bit. So some of those have shifted there a little bit on on that end of it. So oops. All right. So now is where we get into the the meat potatoes of the of the budget. So this is a a lot this is straight from the the council report. So we'll go through this. Um there's some just big topics in here. So there's a public safety master plan and there's facilities and then some of the other things, but we'll kind of walk through it and kind of go from there. Um I think you probably know where all this is headed at this point in time. But u you know the public safety master plan as as Mike has mentioned has been you know a five to six year plan on that end of it. Looking to hopefully complete that here in 28 29 time frame. Um for the 2027 budget, uh fire department is requesting, um six firefighters, and we do have those as a projected hire date of April 1st. Uh the cost of those for wages and gear is about $837,000. Uh we last hired full-timers back in 2025. I think those are mid-year hires that year. Um, I know the chief in 26 wanted to hold off um until they could kind of get those initial firefighters kind of in the queue and see where we're at for facilities, all those types of things on that end of it. So, he took a kind of a one-year pause there. So, now we're kind of back at it to try to fill these last um 12 positions that the public safety master plan calls for on that end of it. Um and so we have Yeah. So be six requested for this year and then it would be planned for six additional hires in 2028. Um we have applied for a safer grant. We've applied for a safer grant for the last three years probably three four years on on that end of it. Um we haven't been successful but um we're get our fingers crossed this year that we will be successful. We've um made a little bit more headway already on this year's grant. So hoping that that's a good sign on that end of it. Um the grant now is a match grant whereas before it was 100% funded for the first year or two on that end of it. So there's probably less a little less competition on that end of it and uh probably makes us put in a little better position on that side of it. So if we were successful I know the requirement is that you have to have to hire those firefighters within I think it's like three to six months or something like that. So uh we would really have to move >> we would really have to move on getting um staff hired on that end of it. we would move to the full 12 um firefighters at that point in time. Um it really wouldn't have a budget impact because that safer grant would probably pretty much cover um our share of the costs even though we'd be hiring 12 compared to our six. Um um the feds would be picking up a portion of those, a big portion of those the first year or two. Uh we would still probably have those public safety master plan increases in future years because we're still going to have to pay for the part that the grants not picking up. Uh but this would allow us to get those firefighters on now um rather than having to wait um a couple years as well too. So So that's the fire department. Uh moving over to the police department within the public safety master plan um last year the police department or last year I mean 2026 um fire the police department completed its hiring of personnel that was outlined in the public safety master plan. Um I think we had a community engagement officer was in 2026 um that was outlined in in in that budget. Uh the plan also called for enhancements to our records management system which we have been working on um diligently and I think that went live back in this spring time frame I believe on on that end of it. So that's been a big lift for u uh deputy chief and his staff over there. So um been a a a good project there. Um that is project is financed through a lease. So we are with ax on for that lease. Um and that's a 10-year lease and that began in 2025. Um and keeping our not fingers are always crossed on on grants, but we have been notified that we have been awarded a congressional um directed spending grant as well too of close to a million dollars. It's like $960,000 something to that nature. Uh we've submitted all of our we submitted the grant award or information all the all all of that information. So the only thing we haven't received is the check. Um but uh hoping that that's in the mail on that end of it. So and that's really towards that um records management system. And so the lease has some upfront costs for that implementation. So it it had higher payments in the first um three or four years of that lease to pay for the implementation of the records management system. we've already paid the first two of those years. And so we'll be able to take these dollars and basically reimburse ourselves, help offset some other additional costs that we have related to um kind of the public safety um uh projects going on, specifically the the drones as first responder project as well too. So um yeah, I think that's been it on that one. >> Thank you. I would just quickly add, you know, if the chief wants to to weigh in, Chief Borboom, just with that grant, just this has been a a couple years in the making. So, just a little bit of history on that. This really, Scott, this started actually when Congressman Dean Phillips was in office. Uh, we were getting close over a finish line with that congressional budget. Things just didn't pan out that year and then with Representative Morrison and then Senator Clolobashar really really being instrumental in helping us secure that million dollars. And so Chief Warboom and his team have been um diligent about really working with our congressional representatives to really get this grant through through the final hurdles. >> I'm optimistic, but until we have the check [laughter] of what could happen at the federal level. So >> I'm pretty confident we're in a better position this year than we were last year. So >> yeah, 100%. Okay. U so continuing with the public safety master plan. um and our drones as first responders. Obviously, the council is well aware of that program and and the the great success that that's had in its early early stages on on that end of it. That program wasn't specifically called out in the public safety master plan, but there was uh um identification of uh investment in emerging technologies and things like that in that plan. And so this obviously kind of fits that um mold as well. Uh so the DFR program, drones as first responders, is about $300,000 a year, but that has really um offset the need for hiring additional detectives as well. So it's offsetting some personnel costs that we would have probably incurred if not for this program. Um and this is a 10-year lease again as well too with with ax on there as well. And so, um, just with that congressional directed spending, we are able to, um, instead of having it be $300,000 and for our budget hit in 2027, it's really going to net out to about $58,000 hit for 2027. Um, we'll we'll have to budget for that in 2028 as it's, you know, onetime grant awards or whatnot, but um, helps us um helps us with the savings on on the tax levy on on that end of it. So, all good things there. All right. So, that's public safety master plan. Um, personnel. Um, Mike touched on it a little bit as well, too. Uh, this is going to be the fourth and final year of our non-union class and compensation study, um, plan. Um, implemented this obviously three, four years ago on that end of it. And uh really it took the non-union employees who were looked at on an individual basis, got them into grades and steps, really formalized um positions, making sure that they're um equity-wise that they're all graded correctly um all those types of things and u kind of looked at them against their markets adjustments as well too. And so we've been uh looking at those market adjustments over the last three or three to four years. um gradually bringing them into place and obviously the council approves uh market adjustments and cola adjustments um usually in November time frame on that end of it and so you will approve the both the non-union piece of that and then if we have any union contracts which I believe there are a few that are up for negotiation as well too on on that end of it um personnel obviously we're in the service industry and so personnel is the big piece of that we saw at 78% of our total general fund budget so it has an impact when we look at a three you know 3% cost of living adjustment along with markets of adjustments of 0 to 2%. It's it's you know $1.5 million which is you know 2.5% or or whatnot of what a levy is just to kind of maintain those existing staff members on that end of it. So uh then we talked about insurance. I mean that's Mike touched on it. It's that it's a healthy increase on on that end of it and really doing our work to try to get us into a better spot on that end of it. but it's no different than what other private industry or other governments are experiencing as well too on on the insurance side of things. So hopefully that it figures its way out and then gets into a better spot. So and then on the on the good front as Mike mentioned as well, workers comp um those premiums are reducing by 20%. Um it's obviously that's driven by our experience rating and then favorable claims and medical costs there as well. So, um it's nice to have a savings of 296,000 versus it could go the other way around and it's um kind of another whammy on top of the health insurance piece of it. So, it was one nice reprieve to see in in the budget when working on this year's um sizing of the budget. So, so other requests in the budget. So, the police department is requesting additional 100,000 $120,000 in part-time wages to increase the real-time operations center. Um, obviously this is kind of related to the public safety master plan, but um it is a personnel cost. It's a little bit separate than that. So, they're not looking to hire full-time employees, but um looking to add more part-time staff to help build the hours around what we currently have. We currently have two full-time employees that staff the the center Monday through Friday Friday during kind of those business hours. um additional part-time staffing would then increase those hours on the the front or the back end of of that as well to provide a little bit more flexibility with part-time staff. So >> So I didn't I didn't see what the last one was. >> Oh yeah. So just a reminder. So um just last month, end of July, the council approved and amended the budget to accept that um Minnesota Department of Public Safety grant for the crisis uh crisis response grant on that end where we're going to be hiring a full-time employee. um for that position and it's 100% funded by that grant and that's for a two-year time frame on that end of it. So, uh we will analyze that and evaluate that as those over those two years to determine the the benefit of that or not. So, um and then I don't want to say lastly because I don't remember the slide order that that well yet. Um community development is requesting a sustainability specialist. We've been talking about this and internally for a while on on that end of it as well too. and um kind of came up with a different funding scenario as well too. Um there's been a lot of demands. We currently have one one person within our sustainability area and um you know she's stretched probably pretty thin on that end of it and obviously lots of opportunities and lots of things that um we can work on if we have some more um bodies in that in that area. And so looking to fill a position there, a full-time position would be about $133,000. Um not sure if we're still kind of analyzing if we want full or part-time on on that end of it or not. Um but the funding from that wouldn't necessarily be from the general fund um is proposed to come from the environmental recycling fund. Um so we would have the environmental recycling fund fees would cover this position and that would be about um on my analysis on some quick math on figuring that out. It's about $2 per quarter to cover this position. Um that would just be the the salary cost on on that end of it and such like that. But um figured that that was a a good direct correlation between um this position and where that funding would come from on that end of it. So >> all right, other areas, facility improvements. I think there's a few slides on this one as well too. And uh council is all well aware of kind of where we're at, how we got to this point with the sales tax piece of it as well too. Um the 2026 budget, as Mike mentioned, we included that first year, that kind of that two-year plan to try um to raise a levy that would pay for about a $10 million bond issuance. So, the thoughts on that a year ago were like we would like to have enough dollars to help with remodeling a fire station 2 and for the um refurbishment of the community center. Uh which between the two of them was about $10 million or so. and that if you know we had in the works like if we got a sales tax maybe we could you know re re-evaluate where dollars went to on that end of it. Um and that obviously didn't come to fruition on that side of it. um looking at fire station 2, I think when we went through kind of the bonding process and it was my first visit to fire station 2 and um looking at the long-term scope of how we want to do things that probably refurbishing fire station 2 isn't the best um most logical financial decision that we could probably make because we would probably have to rebuild it um in short order eventually down the road as well too. And I think um that is kind of probably the overall plan is that rebuilding fire station 2 is the best decision for the long term on that end of it. Um, we submitted that to the to the legislature for a state bonding request last year. Um, requesting five, it was about $5.5 million or so by the time inflation was in there um to help rebuild fire station 2. Uh, we did not receive the full 5.5 million, but we received two and a half million. So, that is that helps with with it. Um, there is a match to match that $2.5 million, which to rebuild Fire Station 2 is about $13 million or so on on that end of it. Um, obviously we'll have a match to to make that happen on on that end of it. So, um, I'm getting off track here. [clears throat] Okay. I think we can go to the next one. Uh, >> I think you've covered some of that. >> Yeah. >> Okay. So, with with the shortfall, um, so we have the $2.5 million dedicated to this. We have the first year levy of of that we established last year of that $45,000. Council approved in July uh moving forward with the community center refurbishment. That $45,000 will cover that refurbishment if we issue debt on that um down the road. Um so now how do we finance the rest of the fire station where we have about $10 million to cover on on that end of it? Um it really comes down to probably sales tax is our um hope on on that end of it. Um that obviously didn't come to fruition this last year, but I think a push on that again this year. There was a number of cities that were requesting it. Um there will be a number of cities again next year that are will be requesting it if not more. Um and we have seen strong support in our community survey as well too. We put that those questions in there specifically and there was um a very strong overwhelming support for a local sales tax to help with our facility improvements um and a number of other projects um that we noted throughout the city as well too. So, the hope is is that if we can get a sales tax approved, that would cover the other 10 million of that, including the match on the on the state bonding piece of that. Um, which then it would allow us if we move forward this $45,000 levy for this year. Um, that would give us a little extra wiggle room to either pay off the community center faster or um keep those dollars in place and save them for other future facility improvements that we probably have as well to most notably probably Wilson Center or um other fire stations as well too that are out and around there. So, I think this I think I covered all of them. >> You did. >> I think I would have. So, >> all right. So, other items outside of those big three things. So, the public safety plan, personnel, and then the facility improvements, there are some other costs within the budget. Um, we do have $100,000 dedicated for the the 2050 comp plan. So, we'll be working on that. I think Julie's probably got that in kind of the top of her mind at this point in time. Uh we'll be spending money on that for 27 and I assume 28. It's kind of a multi-year um piece there. Um trying to get that all accomplished in over the next couple years. We will have $50,000 um for anticipated fuel increases. So um obviously cost of oil has gone up this year. We locked in with rates usually in like November, December time frame for the next year. We locked in some good rates last year um late in the year. U I've assumed that that those companies aren't going to have those quite low rates as they did this year. So um but that can obviously change you know in short time as well too but we are anticipating an slight increase in fuel costs for next year. Um fleet maintenance costs increasing about $200,000 there. there. We um there was some discrepancies between um in parks in the parks maintenance division where we were under budget. We under budgeted the fleet maintenance costs for the current year. So, we've got those kind of in line now with what we're we're going to see actual costs after 2027. Kind of an adjustment on that end of it. Um and then $60,000 for consulting related to the local sales tax promotion piece of that. So, wrap strategies, we'll use them a little bit this year um to help us with that promotion piece. We will use them more if once if we can get legislative approval to make sure that we can get that information out to the public to help them make a decision when it comes to um putting that on the ballot for um for an election time. And then with that, there aren't any other the budget is pretty slim as far as other cost of living adjustments in there. It took literally built it with a 0% increase in uh inflation. So hopefully the directors aren't finding out about this for the first time, but um it is built with as zero in there for for everything that hasn't been allotted in the budget. So we when I go through the budget, I plug in what the personnel is. We plug in some of the other fixed costs for logist for fuel um for those types of things. But there are um they have to make it fit within within their budget target. Um and there is no inflationary increases for some of those other services and charges and supplies which is a smaller portion of the budget but it's still um there are increases that everybody's experiencing across those lines. So um directors will have to make some decisions of some of those things. So, and then Cers will talk Cersell at the end will touch base on our grants as well too. Look, take a look at our um grant um chart, our grants, what do we call it? Our grant >> grant dashboard. Absolutely. So, there's lots of grants on there. Um it's pretty amazing to see what we've we've done over the last couple years as far as um not just applying, but being awarded grants and other funding sources across the city on that end of it. And here's just a recap what you saw earlier in the slide presentation. Just if there's anything that popped out since then, but um just recapping where our levy is and where the increase increases are across each of the different kind of major category pieces of that. So, and this one always gets me uh it's pretty funny. The title is potential 2027 preliminary [laughter] tax increases. I can't get any more like this is very very early non non-s set in stone pieces of that. I know Apple Valley is on here higher at 15%. Um I heard late it was on Thursday last week that they are down lower than that now probably in the 9 10% range somewhere in that ballpark. But um every and really to show this is um it's to have information to kind of see where our comparable cities are at. Every city does have a story and there's a reason why that Apple Valley's number is high there because they had a park referendum last year I believe it was or the year before where they were investing millions and millions of dollars in parks and they knew they would be bonding um for their park referendum um over the next course of the next couple years on that end of it. So that's why that's there. Um, you can kind of see where Minnatonka, we break that out between what is our kind of our operations and our, you know, the public safety master plan and then our debt service to kind of see where it kind of stacks up against other cities on that end of it. But here again, you don't have the story of what every other city's piece is to that on that end of it. Um, you look at some of those cities, you look at a Plymouth to the north of us, it's 3.9%. And I asked the finance manager there, you know, can we move Minnetonka not so close to to Plymouth and Eden Prairie? And they're like, well, that's just a number. It doesn't tell the story either of, you know, we're not we haven't done any of the transition of moving to a full-time fire department or a combination department at this point in time. So, um, where we are making those those moves on on that end of it and such. So, um, you really got to take it with a grain of salt, but it's just kind of information just to know where everybody is at at this point. So, So then when we look at homeowner impacts and um you can kind of see here the the breakdown of the different property types and the overall growth and um as of late over the last couple years obviously um commercial property has been a big talker [clears throat] and you hear about that in Minneapolis St. Paul areas where um values are are declining in certain um segments of the market. Um, Minnetonka is experiencing that in some areas as well too with commercial where we have class A um, singleuse office space. So, if it's a UHG headquarters, those types of things, um, those are experiencing declines in in value. U, but we also have a good diversification of of of properties across the city. So, we have class A um, multi-tenant space which is doing well and has demand for that type of that thing. So, uh, where we've seen the large corporations where they have one building, it's just them, um, those are taking a bigger hit, but we have a good mix of of users across our city on that end of it. So, it isn't as impactful, but it does still impact um, our residential side of things. It's going to shift the the burden a little bit more over to the single household residential. Um, you can see there that six uh, 6.6% is the residential growth. That's not the value increase. That was the total growth was 6.6. So that's with new construction as well too. I think the actual growth was 5.8% to $549,000. Um, and you can see that that's going to be about $150 impact on this 6 8% levy increase, which is about 7.4%. So if the levy's going up 6.8% and the impact is going to be 7.4, that really kind of speaks to there's that shift in burden. that's moving away from other property types more towards a single household um residential properties on that end. And here's just over the last 10 years, you can kind of see how um the residential side is has grown a little bit. Um apartments have grown as well too. So that we've had lots of new apartment additions. So that's helped with um some of that shifting from um office space or commercial industrial as well too. Um, and if it wouldn't have been for that, the residential impacts would have been much higher as well, too. So, and they do eb and flow. I know it doesn't look like they eb and flow over 10 years, but over the course of decades, they do eb and flow. Um, but um it feels a little little bit like the eb is is taking a little longer than the flow part of it. So, and then the h levy. Um that's limited by by state statute. We can levy up to 0.0185% of our market value. Uh which theoretically we could levy $2.5 million or more for our HR. Um historically we have not levied anywhere near that. We've levied, you know, $300,000 or so on on that end of it. Uh for 27, we're looking to reduce that to $225,000. Um I think we we had a 10-year payback for the light rail. I believe that was $75,000 a year that ended in 2026. Um so now we're able to to lower that and that um funding is um right there where it's mentioned [clears throat] and was mentioned at the EIP meeting back in July 20th and has not changed since that time as well. So so with that um I do have a couple attachments. Just want to look at the the attachments that are in the packet. There's a a preliminary budget that's there that breaks it down by revenues and expenditures for um total revenues and then by program, but then by department division as well too. And then there's a kind of a year-to- date June 30th snapshot of kind of where we're at year to date as well too. So we can kind of take a quick peek at those and if there's any questions we can hit them then or now either. So >> um >> I'll turn it back to you here for a second. >> What do you think, Mike? I think we should let's let's finish this up if that's okay and then >> keep note of your questions everybody and we'll get through them. >> So we'll look at the Holy cow. >> Okay. This is small. Let me blow this up here. So, who's driving here? >> Who's this? >> I don't have a keyboard. >> It wants It really wants you to do a tutorial, >> right? I see that. >> There you go. All right. All right. So now we can kind of see it a little bit better. So we'll kind of take this in sections here a little bit. Um so this is our this is the h I well this is our Hubble report. So this is our June 30th snapshot of our where our budget is at. We'll take this one first since it took me a while to get to here. Um so I provide this to directors on a quarterly basis. So finance we obviously look at a little bit closer on on that end of it but kind of give them a highle overview of where everything is at. I put the arrows in here to kind of draw their attention or draw our attention to it a little quicker and easier on that end of it. So, green arrows are good, yellow areas are kind of within that variance margin and red arrows are the ones that you um kind of take a look at to see why what the issue is there. Uh if you look at on the revenue side of it where we got some red arrows, we got a red arrow on intergovernmental. Um that's really related to our public safety aid. We get that in October 1st of every year. So we get uh police and fire aid of $1.2 million or more at that point in time. And so that'll really shore that intergovernmental piece of it up. And so I'm not concerned that that's under at this point in time. Um and you look at the next one, investment on interest earnings is at 1%. That doesn't look good. uh when you had last year you had $697,000 as of June 30th and this year you have you have 10,000 well really what happens there is at the end of 2025 end of every fiscal year every calendar year um Gazby our accounting standards requires us to do an adjustment to our interest earnings to mark our investments from market from book value to market value. So depending on how the market is and what we have for investments, you have to do an adjustment either up or down. The last year was at the end of 25 was a really good year because the market was declining. We had investments on the books that were um and we always hold our investment majority of the time we hold our investments to maturity. So we don't when we do this marktomarket adjustment, it it kind of drives me nuts because we as a government entity we hold 98% of our investments to maturity. So we don't really care if the market's going up or down. we bought this government agency bond that's going to earn three and a half% interest over the course of five years. Depends on if the market is up or down at the end of each year. We have to make this adjustment. And so we make this adjustment at the end of 25. Markets were trending down. We had some good investments on the books. So we're like, oh, we get $300,000 more of investment earnings at January 20 January 31st, 2025 on the books. That's just a book entry. It's not an actual cash in hand. So what happens then in 26? we have to reverse that entry. So now it's $300,000 negative. And so um it takes us a while to get to there, but at the end of each year, um it'll work itself out. And actually, when I look at the actual interest earnings, the actual receipts that we've received to date, um I think we're up $70,000 compared to last year with our interest earnings compared to this year just in the general fund piece of it. So um our investments are are good. Um interest rates aren't going to be declining. Um, so we're we're able to start purchasing investments as they mature for a longer period of time with some good interest earnings. And so, um, even in the budget, we built that up up a little bit more as well, too. I think in the past, we've kind of estimated about a 2% earnings. In this year's budget, we're going to estimate about 3% earnings on that end of it. So, um, really helps us with our general fund as well too of kind of helping with the the tax levy piece of that. So, so those are the two red ones. um miscellaneous um line there is up to 110% already. So it's above budget. Um big piece of that is antenna lease revenues are in there. And then also we did that bond issuance for um Bre schools earlier this year where we had that conduit debt issuance. That fee went into the general fund and I think that was about $90,000 or so as well. So that um helped bolster our our earnings there as well. >> So as we move down to the expenditure side of it, And just overall, we're sitting at 52%. >> With our revenues, five months into the year. So, we're sitting well. >> Six months. >> Six. Excuse me. Six months. >> Yep. Yep. You're fine. Scroll rate. >> Yeah. >> And so, if you look at our expenditures six months through the year, we're sitting at a total of 46%. So, that's um below budget. That's, you know, if we're at that halfway point, we'd be at 50%. You always like to be under a little bit because at the end of the year there's always the payables, the things that come in in January and February that are December 31st items on that end of it. So you always need a few percent to help get you through until you close out the books on on final finalizing things. Um if you look for breaded arrows, you see one. It's up there on mayor and city council. Um this is this is the norm across every city across the whole state. uh mayor and city council budgets typically have their dues and registrations are all due at the beginning of the year. They're paid on January 1st and then it takes as you allocate that out over the remainder of the year then it actually drops back into um line with it at by the end of the year on that end of it. So again, a grain of salt. You got to understand kind of what you're looking at. But um mayor and city council budget isn't a big budget, but it paid a lot of their dues um memberships to, you know, uh league league and to what conservation district, you know, um all those types of things on that end of it. So you're a lot of your expenses are incurred early and then it kind of um falls off after that. >> Okay. Yeah. So, other than that, everything looks good on that end of it. I'll pull up that other that other one. All right. So, this is a preliminary budget for the general fund for 2027. Similar to the last report, um little different layout, but just um same information that's in there. Um obviously here's the top part with our revenues. Um this has 24 25 actuals, 26 original budget, and then 27 requested. Um at this point in time, um here you can see anything that's kind of bigger. You can see the investment interest. We have, you know, growing. We talked about that in that last report of an increased interest earnings for for this coming year for 2027. [clears throat] Um, what else is pops out? Licenses and permits. Um, Julie and I have talked about this one quite a bit and Julie does a good job of of kind of trying to predict the future a little bit. Um, I pushed Julie a little bit this year to um, kind of look at our our actuals and so we went back and looked at our actuals or I did over the last six years. Um, took out the put in the actuals for the last six years. I threw out the high year just to help with to be a somewhat conservative on it. Um, because we did have some high years right after COVID where we had a lot of remodels and those types of things taking place. threw that out and and came up with an average and that average is is kind of what you see there for 2027 on that end of it. So obviously we have to um put lots of pressure on Julie to make things happen, but >> [laughter] >> um it's not the numbers she necessarily wanted, but um I I think trying to take a look at kind of where we're at average-wise. Um and I mean it's it's not a guess, but it's I mean obviously there's things that are in the pipeline, things that could be in the pipeline. Um and obviously the economy obvious obviously plays a role into that as well too. Interest rates remaining higher probably doesn't help that number um or help that u getting there but uh we will kind of see where that is that comes out at on that in so [cough] trying to kind of come into those more actuals and not be um want to be conservative with it but not um still don't want to be ultraconervative where we would have to cause taxes to go up to to cover those types of costs on that end of it. So then if we look at our personnel services there in that second grouping there um obviously that personnel line is is the big chunk of it going up 7.6% that's obviously just your um health insurance your colas and then obviously the additional um firefighters within um there as well too the six additional firefighters. So causes that number to increase a little bit there. >> Go too far. >> No, you're fine. You want go down by expenditure by department category on on those end of it. Um couple of them that pop out here. Um kind of start at the top, mayor and city council. Um we got that going up about $70,000. That includes $60,000 for um wrap strategies as we talked about in the the other PowerPoint presentation for the sales tax um piece of that. Um and I think we have 10,000 in there for um agenda management software related to um >> digital accessibility >> digital that's a second time really I could remember that that um so that accounts for the increases there um obviously fire line 26 there um that's related to the hiring of additional staffing um parks and trails that was related to that adjustment for the fleet u maintenance costs on that end of it and such. >> [clears throat] >> Um, I think that's about all I know off the top of my head on on that end of it. So, and I think communications pieces of that too, I think, um, are kind of related to the cable fund as well, too. We've been trying to move some of those expenditures out of the cable fund because the franchise fees aren't covering as much as they used to. And so, we've been trying to allocate some of those costs over to um the departments that that need or that are incurring those costs as well, too. So you can see there the total expenditures are 64 point almost $64.3 million and that then equals um the top part that was circled there as well too. So I think that's okay about it there. I think there's anything further. So So with that I I'll turn it back to >> show Grant. We'll show Grants. >> Oh Grants. Sarissa. Yes. Sorry. Show Grants mayor and we'll >> Absolutely. >> Then staff will be done >> for a little bit. All right, Sarissa >> here. >> That one I'll zoom in a little bit more. See a little bit better. Hopefully you can see that. Um, so these are the grants since the beginning of 2025. So it's showing 2025 and 2026 year [clears throat] to date. Since 2025, we have been awarded 31 grants. 13 are in the submitted status. So they're pending and we have been denied 10 grants. And looking at department, seven out of our eight departments have applied for grants. And this is showing grants we have been or have applied for and the ones we have been awarded. Um the heavier departments with grants is community development with nine. This is police with 12. >> Oh this is fire with 12. Police submitted 10. And then public works is at 12. And then these are the dollar amounts. So since 2025, we have been awarded over $9.5 million in grants and including the city match, that total is $15 million. And then I like looking at the all grants. So that means just all the grants we have applied for. I think this number is important because it shows the efforts that our staff puts in to apply for grants. So the total amount is 23 and a half million. And then with the city match that is 33 million. And looking how the grants align with our strategic plan. Um this is really small. So this is awarded and submitted grants. Um 22 of the grants align with safe and healthy community followed by sustainability with nine grants and infrastructure and asset management with eight grants. And then I took this and it put into dollar amounts. Let me see if I can make that bigger. Um, so this shows infrastructure asset management. So out of the G grants we have been awarded and submitted, they worked on $7 million in grants. Safe and Healthy Community is at almost 11 million. The yellow is $1 and a half million dollars for livable well plan development. We have a sliver of almost 200,000 for community inclusiveness and then sustainability, resilience and natural environment is just above 500,000 and there is a little sliver in their financial strength but so small doesn't that it doesn't show up. [laughter] Um, and then let's see, zoomed out a little too far, but this just shows our revenue source total. So, you can see it's 25 of our grants come from the state and 17 are private or nonprofit. And this below is the specific grants where all this data is being pulled from. So, this is what staff is working all the time. This is the data they're entering and making sure it's up to date for you. Do you have any questions? Oh, and I should say that this also includes the state bonding and other revenue sources. I don't know if you want to add on to that, Darren. >> Yeah. So, we've included Yeah. So, like the uh state bonding piece of that isn't technically a grant, but it's another financing source that we kind of consider a quasi similar type of grant on that end of it. So for instance the safer grants in here um all of those types of of grants and other funding sources are included as well. So >> let's just add any questions on the grants. This is always really nicely done and and very user friendly. Thank you Sarissa. Thanks and to staff for all their hard work on this. It's remarkable. So, all right. While we pull up the questions that staff has for us, let's start with our questions for them. So, going back across the And did you want to sum anything up, Mike, or >> No, I think good question, Rebecca. I think staff is open for questions you have about anything we presented and then we do have our questions. >> Great. >> All right. So, let's start with any questions. Paulie, you had one you were hanging on to. Oh, yeah. >> Anybody? >> Oh, I just >> Go ahead, Paty. >> Well, can you I know you mentioned um the 10% incred increase for parks and trails. Can you say a little bit more about that >> in that budget that? >> Yes. >> Yeah. Um >> so we have the fleet. So I work with I work with fleet to to allocate out their um repairs and maintenance costs and um all those types of costs on that end of it. And we had underbudgeted in the in 2026 and so we're adjusting it to um kind of more mirror where the actuals are going to be at for 2027 on that end of it. So >> hopefully that's what you said >> correcting the current year's error on that. >> Thanks. >> Um Deb, go ahead. >> Thanks. Um I had talked to Mike about it earlier today a little bit about the real time operations center staffing and um just one I just wanted to make sure um that it's adequately staffed. I'm just wondering how we arrived at the halftime and it, you know, I know it has to do with sort of peak time staffing and I'm wondering what are we adding to the, you know, schedule? Um, and you know, what if we find, you know, it's so effective, what if we need it more in the future? And then I actually talked to Mike a little bit about and we he had a explanation for me about, you know, cross-training other staff um to staff it more in case of an emergency or some unusual circumstance. And I know that, you know, we're using nonsworn officers, which has a different budget impact, but if you could just talk a little bit about that because, um, you know, we saved two u retail detective salaries and, you know, I just want to make sure that you're getting what you need, that the community is getting what they need. and how we're going to determine it moving forward. >> Yeah, I can do that and maybe Jason, you can jump in if you need to. So, we're almost a year since we launched the program. And when we when we launched it, we started with our two current full-time employees who have other jobs. They they they support the detectives, they're our data analysts and our crime analysts. And so, they already had a pretty full um um you know, breath of work that they were doing. So, they took that on in addition to that. And as we have acknowledged it, it has far exceeded our expectations over the last year. And for us, we really like to show a need before we just jump into it. And so now we're in after about a year, we started to evaluate our call load and we are trying to um you know staff that beyond the normal working hours into the evening hours. Um our goal is to really look at part-time um more flexibility with the staff and then you know less you know maybe we don't have we don't have the benefit earning folks and also the type of person we're looking for. It may not be like a career. It may be somebody that's coming out of college looking for some part-time work or it may be a retired first responder that wants to to work in that environment. So we're just really and in talking to my colleagues in other cities that are doing this. They're all trying to figure out what that staffing model looks like. And for us, I think having, you know, um, several people on hand to fill maybe a four hour shift, six hour shift, really give us some flexibility around that peak call load is what we're looking for. And then to support the full-time staff as well. Um, regarding uh current staff, I I think the the struggle we have is one um looking at the compensation for the position. we don't want to put an officer in there or a higher wage earner because it takes away their, you know, their their their being in the field. And I and I just I don't I have a hard time justifying that. Um, we do have some ability to after hours. I mean, our current analyst can can can actually get on from his home if we really need to at night. So we do have some ability to do this after hours, but it's more the the routine calls, you know, between I would say five or six and like probably 10 11 depending on the day is really providing some flexibility um for that position. And again, I think we re-evaluate it and if there's a need, we'll come back to the to to the um to Mike and to the city council and demonstrate the need. But at this point, I think this provides the most flexibility is having some part-time staff um and and really trying to see what that looks like. And I don't know, Jason, is anything you want to add? >> No, I think that makes sense. Looking at the call volume, you know, after 11:00 at night. >> Yeah. >> Being able to actually deploy the drone being able to actually deploy the drone is pretty limited. So having a full-time staff member there later just >> Yeah. the call doesn't justify it. I was just trying to be better, you know, mindful of what the actual need is right now. So, [snorts] >> thank you. I have one more question. >> Just um >> and this has to do with, you know, there was some talk of it uh adding staff to sustainability and you know, there's never um you can't do enough. I mean, there's there's so much to do, but um I'm just wondering if at some point we can get a little more of an idea of um sort of the work plan of you, you know, I know there's plenty plenty of work. I just I'm just wondering, you know, sort of how the sustainability staff would divide and conquer the work and um because I'm not necessarily against it. I'm just wondering what all they'd be doing. >> So, Julie, you want to take that? >> Yes. I mean, I think uh we were fortunate enough to be able to get a green core member starting here shortly. Um and that'll take us through maybe you know next year around this time but once that person leaves and the support to do a lot of things like the volunteer coordination um there's [clears throat] a lot of events that are coordinated through this position and we all know how much time that takes. So some of that could be offloaded and allow uh the sustainability coordinator to do more grant writing. she's been really successful at what she's done so far, but it takes time to do that and then also do those programmatic kind of ideas that we've had um in the climate action plan. So, keep focusing on the climate action plan in that job and then maybe more of the day-to-day activities and coordination I think would be important. The other thing we've talked about because of the recycling uh and the funding source then taking over the recycling responsibilities as well um answering phone calls, coordinating with residents. So those are just top of mind things that I think we're thinking about. I don't think we have it totally figured out yet, but uh we're testing the waters, I guess, with you tonight to see if you want to go and then we'll make more detailed plans if if it's a go. >> Great. All right, Paula, you're up. Thank you. Um just a couple of kind of comparison questions. Um so in the city comparison we talked to there's no apples to apples. Um I was just wondering the list of cities do we know are how many of those um just out of curiosity uh special assess for roads or or is that does that play into any of the differences? you know, >> good question. Um, a number of those cities do special assess. I know there are some that do not. I don't believe Eden Prairie is special assesses. They use their franchise fee for their road improvements. So, where we have our $6 million that goes into the street improvement fund, they're using their franchise fees for um road improvements there. Um, I don't believe St. Louis Park special assesses either, but I know Plymouth does special assess and I know um in talking with them that they actually allocate some of their staff time to that as well, too. So, it's not just the contractor costs that they're paying for that they'll allocate some of their engineering staff or staff that are on on the ground will go towards that project costs. And so, we pay for those costs out of our general fund for our engineering staff. We don't special assess those. So, um it all kind of goes into that. Um >> yeah just yeah I was just trying >> process processing developing a budget there but yeah that does that is part of it. >> All right and then um thanks for I really appreciated the explanation of the 6% 6.8% general levy increase versus the you know average of of 7.4% for a $550,000 home um you know that increase. So, just to to clarify or to make sure I'm understanding and confirming, um that increase encompasses basically 30% roughly of a property owner's taxes. So, because our city portion of of the overall taxes, so they might see additional increases depending on what Henipin County does, what you know the school does. Is that correct? I just want to make sure that we're setting expectations properly and not, you know, getting to a point then where people say, "Oh, it's, you know, 150." And then the end of the year comes and it's a different number. So, just confirming for myself and then maybe for others to make sure that I'm understanding that correctly. >> Yes, that is a great point. So, yes, that 150 is just the city portion of of your tax taxes >> and we don't know what kind of the county or the school district or I know we have mult school districts covering or any wershed district all the other taxing jurisdictions. >> Okay. >> 100%. >> So that'll come into that too. >> We usually I would just add we we usually get a sense of what that is. Again I say right in you know mid August. A lot of cities are doing what we're doing this week and next week. Same thing with the county and school districts. So I I think we're going to start to learn a lot more in the coming weeks and probably before September. We'll we'll have a better sense of what perhaps the county and our school districts are thinking. We have the mayor and I have a meeting coming up with the Minnitonka school district. We'll probably learn where where they're projecting uh and meet with the county manager and other city administrators coming up. And so we'll get a sense of where the county is. Um >> and then we have the fiscal disparities piece too that I assume hasn't come in yet. >> Correct. Correct. or isn't Yeah. Um yeah, and then in terms of I guess if just following up on the sustainability coordinator, um I think that's great. You know, also be great to see the work plan, but um and also at some point, you know, this is something obviously, you know, I really appreciate it because, you know, something that is >> Can you speak a little louder, Paula? Sorry. >> Sure. One of my priorities. Um, but also, you know, eventually I I see this as a great first step and then hopefully we can uh at some point uh allocate funding for uh rebates and cost sharing and other programs. And I'm hoping that maybe hopefully this position will be able to help connect in the meantime connect residents um with other programs that you know might be out there but not as well known. You know kind of finding I think Alli's done a great job of finding grants and things like that. So hopefully we can kind of continue to do that but eventually also having city resources um going into this. But in the meantime, I I certainly applaud the sustainability coordinator position and look forward to having that on board. And then my only question comment would be um this is more minute. I look know we're looking at the 30,000 foot level. Um but we have some I think outstanding decisions that we need to I think still make about culling and purgatory. So I just wanted to flag those and and make sure that we're kind of marking those room for those potential um funds in in the overall budget as well because I I I heard what you say that you know directors may have to you know they're going to get a certain amount and then they may have to make your decisions and um just you know before we get into September and we make those final preliminary budgets that we make sure we're making room for those if possible. >> Council, any other questions? Okay. Well, then we've got their questions for us, which is, you know, the first is pretty basic. Does the city council support a base property tax levy increase of 6.1% including the 1.6% for continued implementation of the public safety master plan. So, let's take these one at a time. If anybody, you know, has any I guess thing meaningful to add otherwise, you know, I'm gathering there's general support for this budget and we've talked already even now in August quite a bit about it. I think I appreciate the um I think the chart that you do that indicates where kind of the increases show up is really helpful for us in understanding and certainly the the wage pressure and the insurance pressure is significant. So um that's hard to that's hard to bring down. There's no magic bullet for that. And I I just I was talking to Mike about it earlier and you know we hear from residents rightfully so about you know sharpening our pencils but a lot of residents don't understand that cities have the same inflationary pressures as people and um you know those insurance rates I mean 24% is an absolute outrage. I don't care how many claims people make. People get sick and that's what you buy insurance for. And you know, Medicica has a huge pool. I know City of St. Paul uses Medicica um for their plans and um you know, I don't I don't know what we can do about it. I certainly intend uh to talk to my legislators about it because it's not sustainable. I know that Senator Clolobashar in laying out her, you know, gubernatorial priorities is talking about a huge health uh over, you know, health industry overhaul because it's just not sustainable for people or governments or companies. And um I just think helping our residents understand these I mean 24% increase is is a whole percentage of our levies. It's an entire percent and that's just insurance that doesn't c you know that's not all the other inflationary the fuel and all of that that was also in the budget and I think what we you know one of the things I was really struck by in reading the staff report and feel good about is the areas where staff is saying this is our worst case scenario on the medical insurance you know we're going to re-evaluate what the marsh is going the need to transfer. Um we're going to take it, you know, there are other things that we're going to take a look at. So truly this budget is keeping in mind that we may end up here, but as we say every year and and I trust that what staff has done is put in an honest budget that doesn't have fluff in it, but we know that between now and December, there may be opportunities to save on real costs. And I appreciate that. I know that our residents appreciate that and we'll just keep pushing to make prudent decisions. There's not extra in this budget. I I feel really comfortable with the staffing decisions um that we're looking at and um so I feel good about that. >> Another I have one other thing just thinking about the marsh. I know that there was a time uh and I know that um mayor worome was uh very interested in sort of like a Minnotonka Foundation um to help fund things like uh fixing up the marsh and so I don't want to give up on the idea and I don't know what the legal ramifications are around that but um you know we have a lot of big corporations here um that have enjoyed um a lot of success um being headquartered in Minnotonka and we you know we do have a wealthy community and I'm just hoping maybe if we can't get that sales tax for some of the things that we want that maybe that's a route that we can go and just get you know people that have civic have a sense of civic responsibility will help um keep our city wonderful. That's a good point, Deb. And I I've been working on those relationships too and meeting with folks at the very preliminary level to just get to know people so that maybe as opportunities come up, we can leverage them and and have not only staff have good relationships with some of these decision makers, but if they can kind of understand that we're real people, too, trying to do best by the city, maybe there are some opportunities there. All right. Um, so I think we've got support on that. The second question, and this is the more complicated question in terms of what the money is where the money is going to go, but does the city council support an additional 7% for facility improvements related to fire station 2 improvements for a total levy of 6.8%. So this is where Darren spoke about, you know, if we have to go it alone, just using the bonding on the fire station, this will help us do that. If not, that frees up some opportunities to get some much needed improvements at Williston or even to pay off the community center faster. So I'm happy to take input on this question if anybody has anything. >> I mean, that's ongoing and I feel like that's a yes for me. It just makes sense. Mike, did you want to add something? >> I'm just gonna add some additional context and and you think about maybe the few different pathways with that money. U one is as we've talked about having the flexibility to invest into fire station 2. That assumes we don't get the sales tax. So we do have some flexibility to then have now 800,000 towards a debt issuance for fire station 2 and the community center. Let's say we let's say we get the sales tax and that we get the authority and the voters approve the sales tax. Another use of that 800,000 is to then basically pay off the community center in five years. So you can take 8 that 800,000 and pay off the we're estimating what four and a half to 4.9 million in in improvements to the community center. So you can take the 800,000 and pay that off in a relatively short period of time, six years perhaps. Another flexibility point you have is as noted here this evening, you can look at using that 800,000 do a larger bond issuance to to do other improvements whether it's the Williston or other capital needs that we have. So the point being I think you have f you have flexibility and that's the best place to be in is to have that kind of flexibility not knowing exactly where our our our path is exactly today. >> Thanks Mike. So, we're hearing um positive from Deb. Anybody have an any different thoughts on that or something they want to add? All right. Well, you guys are hitting it out of the park tonight. All right. Does the city council agree that a total of 225,000 should be certified as the HRE preliminary levy for 2027, which is the same levy presented at the EIP study session in July and as referenced is $75,000 less than the 2026 representing that we've satisfied our obligations relative to the LRT contributions. Well, I'll go ahead. >> I'll speak to it and I'll speak to it again. I probably speak to it until I'm off the council, but um I did talk to Mike earlier about the 125,000 for homes within reach. Um, I'm going to always say this. Um, and at maybe one day the council or whoever's, uh, come on to the council after I'm gone would catch and understand why to me it's important to really try to invest in other programs or come up with something different. Um, I'll say it again. I I think that holds within reach. Um, we keep I don't think that Minnetonka will ever change this thought process. I don't know if this is a to me it's a state issue because it's not just Minnitonka who's um funding Homes Within Reach program. Minneapolis has their own um program as well. And so I know that it's just not a city thing, it's a state thing, but um the state of Minnesota is stripping equity from lowincome families as well as people of color because a lot of people of color is into in this program. And it's unfortunate that our city continues to support this program in the way that we're supporting it because I feel like the onus is on all of us here in this room. And so, um, I'm gonna continue to use my voice to say that I think we could do better and I think the money should be directed to a different type of program. >> Thanks, Kizzy. Anybody else have thoughts on this? You know, we talked quite a bit at our housing study session about um some of the concerns that have been raised about homes within reach. I think you know if anybody has more input they want to give this would be the opportunity. Go ahead Paula. >> Yeah I just want to say that I totally respect that you know viewpoint and I can understand that perspective and you know I'm glad that we have the pathways program and some other ways to kind of address that. I think that's been a really great step in the right direction. Um I'm not sure how to how how to change that though and still guarantee affordability for future owners. You know what I mean? So I think the pathways does that. you know, our welcome to Minnotonka does that and those are, you know, really different and and and kind of I I think are getting towards what you're talking about. And I think the homes within reach because it's almost like in some ways you're getting the equity up front because you're not paying for the land. Um, so that's kind of how I view it. I don't want to, you know, I don't want to leave the impression that I'm, you know, not in favor of of helping out all, you know, low-income families, especially given our disparities in terms of home ownership um in families of color. um yet and and I also agree that we have to look at a variety of different programs in terms of housing, but again, I don't know how to get around having a program like homes within reach and have it exist to build equity at the same rate as say a market rate housing when the goal of the program is to maintain affordability. So that's where I don't it's not that I disagree with what you're saying. It's just that I see that we might have other programs for that. So I really want to kind of just speak out and let you know that I support what you're saying, but I just maybe see a different way about how we're addressing that. >> Anybody else on this issue? I think generally there's support for the HR. There's this kind of ongoing question about the funding of the homes within reach new purchases. Anybody? I I think as I mentioned at the July study session, I you know I I have some concerns about what the satisfaction level of the program and certainly if it's not meeting anybody's expectations then we've got to regroup. But I'm not, you know, I I think we have work to do and I know Paty's going to, you know, keep doing her work on the board. And so I feel comfortable sustaining this now with the understanding that, you know, if we can find other opportunities and to Paul's point, we have diversified our opportunities. I think that does make sense. or if it's just turns out that overwhelming number of people in the land trust programs are dissatisfied then maybe we have to re-evaluate our our support of it you know and I think it's a good idea you mentioned Rebecca last week an outside um source that that sort of evaluates the the not Walt itself, right? And not homes within reach itself, but somebody else evaluating, you know, like who, you know, how many >> how is this working >> exactly? How many families have been served? I mean, that are, you know, actually benefiting. >> All right. Anybody else? >> I'll just >> Yeah, go ahead, Deb. >> Yeah. So I I agree with with what um Paula was saying and uh you know has a slightly different purpose I would say homes within reach and because you're not paying for the land up front or ever, you know, every the mortgage is cheaper and it provides ways of of saving. You're saving. It's you're spending less and so it it you're not going to get as much equity, but you're also not paying for land. >> Land >> and you're paying for land. You're paying taxes on the land. >> You're paying taxes for me the amenities. And I mean, I'm saying this as a person, and I've said it before. I I lived in a house that was very much like Homes Within Reach. And it wasn't even a house. It was a trailer. And it's how we saved for our first It's how we started to save for our first house. And so I know that it's very limited. Um, and it it it limited us, but we were able to save money because we weren't we didn't have to we paid for the structure, not for the structure and the property, and we paid our taxes. All right. So, generally, I think there's support for this. Um, and reasonable minds can differ on on these things, but we're looking for a majority of council support and I think I think we're seeing that. So, with that, um, staff has what you need. I think simply today, um, >> I don't support it, >> right? >> I just want you to know that. >> Okay. Thanks, Ky. appreciate your perspective. All right, so with that, we will go on to the next, unless you have anything else, Mike, we'll just go on to our last agenda item, which is October study session topics. >> Yeah, thank you. Miranda's helping me pull it up. While while she's doing that, just want to say thank you to the council. Appreciate your conversation this evening and talking through our budget with a productive conversation. I think it goes without saying and perhaps Rebecca you already touched on this but again just really applaud our staff the time that Darren and our team puts into presenting here this evening we've been really tight and you know it you know we're still looking at a 6.7 levy percent increase that's still significant um and yet it's it's tight in the sense of our operations you know we're we're really just budgeting for our for our personnel uh and some of those other cost drivers that we mentioned and along with our investments in the public safety master plan and our CIP. So, I we're doing our I think we're doing our part to make sure that we're meeting the needs of our residents and really being cognizant of our strategic plan and making sure we're making the necessary investments. So, again, appreciate it, council. Thank you for your again your your time and thoughtfulness and the questions that we all talk through throughout the day and this here this evening. So, with that, um looking ahead, uh our next study session is October 12th. We do not have a study session in September if you recall. A couple items uh that have been on there throughout the year is the zoning code rewrite update. So Julie and her team will be here for that conversation. Also aligned with that is our comp plan review process. We talked earlier about budgeting next year for that expenditure and we'll start laying out what that process is going to look like. And then ebikes uh it was put on the agenda. So we'll have an ebike presentation connected with Chief Borboom. So they'll be ready to uh bring forward some uh talking points and presentation on ebikes with the city manage review coming up as well. So that's uh we'll start that process in October. We do also have that 30 minute open time for quarter 4. Then in November as noted earlier is budgets again. So we'll be bringing back really kind of the more comprehensive package uh along with our enterprise and special revenue accounts. We'll take a deeper dive into those. And then in December is our what I call more of our general housekeeping study session where we start gearing up for 2027. Um also noted on here. So thank you Sissa for for pointing that out in January of 2027. That study session will be dedicated for boards and commission interviews. So we'll we'll start gearing up for those openings as well. So that's what's on the docket. And if there's any changes to that, uh mayor and council will need your direction. >> Um go ahead. Just just really quickly in in one of my in my League of Minnesota cities committee um we've been talking about ebikes and one of the uh committee staffers sent a presentation that the league did on ebikes. So if anybody's interested I'll try to forward it to Mike or Miranda or somebody and they can share it out. >> And are we anticipating doing your review in October Miranda? Is that the thought? I'll take that one. Um, in October it's just probably 10 to 15 minutes. So, we're going to move into the Neoga perform system this year. Okay. >> Um, we're actually building it right now. Um, Sarah and I meet on Thursday with Neoga to go over the final details. Directors will be taking it in September. We're doing the review in September. Council October. We'll do the review in November this year. So, this is just the training component to get you into the system to do the review and get rid of that clunky PDF. I was going to say I'm really hoping we can do the review some late night in December right before [laughter] Christmas. So, I really miss that tradition. Couldn't do it. All right. Um, any anything else from anybody regarding the study sessions for the rest of the year? All right. Well, excellent. Well done, everybody. And again, staff, thank you. Thank you all for all the hard work you put into this. And it's the hours leading up to this that made this ME meeting much more efficient than it could have been. So, thanks so much. And still light out. So, >> we are journed. [music]