Hennepin County proposes $398 million operations budget; highlights grants, housing, fiber and climate targets

Hennepin County's operations leadership presented the proposed 2026 operating budget for the operations line of business at the Administration's Operations and Budget Committee meeting on Oct. 22, saying the request totals approximately $398,000,000 and that major drivers include debt retirement and contingency use.

Sherry Gittell, who led the operations presentation as Assistant County Administrator for Operations, described the line of business as responsible for foundational county services and programs that support other departments and residents. "We are focused on advancing the county's priorities on climate action and disparity elimination as we deliver sustainable services and innovative solutions that put people first," Gittell said.

Why it matters: The operations budget funds core internal services and externally facing programs (housing, grants, facilities and IT) that underpin county operations and influence capital and service delivery capacity across Hennepin County.

Key points from the presentation

- Budget totals and drivers: The proposed operations operating budget for 2026 is about $398,000,000, a 2.1% increase from the adjusted 2025 budget. Gittell said the request includes significant increases in debt retirement (approximately $20,900,000) and a $6,300,000 increase in use of contingency, plus personnel-driven increases across departments; those increases are offset in part by program shifts and reductions in ballpark debt retirement.

- Property tax and FTEs: Operations' property-tax-supported request reflects a 10.7% increase over the 2025 adjusted budget. The line of business eliminated 12.1 vacant FTEs (about a 1.4% reduction) and increased vacancy factors in some areas to manage personnel costs while protecting services.

- Grants and housing: Grants management coordinated about $75,000,000 in discretionary grants awarded in 2024, supporting disparity-elimination work in health, connectivity and justice. Facility and housing programs reported 942 affordable housing units opened, reopened or improved; staff said 1,800 units were dedicated to people exiting homelessness in 2024 and the county is on track to add more than 200 such units in 2025.

- Economic development: The Elevate Hennepin program has served over 4,000 entrepreneurs, launched 263 businesses (68% led by entrepreneurs of color) and helped create more than 900 jobs, staff said.

- Digital infrastructure: The county has installed more than 375 miles of fiber optic cable since 2012, connecting more than 80 county buildings and approximately 480 traffic signals. Website traffic statistics showed substantial public use: county web properties received about 12,100,000 visitors and 80,800,000 visits across 22 sites in the 12 months cited.

- Climate and energy targets: Facility services aims to reduce building energy use by about 3% annually and supports the county goal to cut greenhouse gas emissions by 45% from 2010 levels by 2030. The county plans a multi-year solar installation program expected to generate about 4,800,000 kilowatt-hours per year (roughly 9% of projected 2030 electricity use); with an additional array planned at Brookdale in 2029, staff said on-site production would reach about 10.2% and meet that target earlier than expected.

Challenges and opportunities described

Staff described uncertainty in state and federal funding, the need to preserve existing streams, and the value of partnerships to fill gaps. The county's enterprise integrated data system was presented as a tool to analyze service overlaps and target investments for disparity elimination; Gittell said the system helps identify about 420,000 individuals the county connects with in a given month across major program areas and that roughly half of those individuals touch more than one service area.

Discussion vs. decision

This presentation was informational. Commissioners asked clarifying questions about housing funding, the Hennepin Energy Recovery Center debt service, internal service funds, and plans for early voting access in outlying service centers. Staff committed to follow-up memos and data where requested.

Ending

Gittell closed with thanks to operations staff and a pledge to provide additional detail in follow-up materials requested by commissioners.