Metropolitan Council presents $1.8 billion 2026 operating budget, seeks 2% levy increase

CFO Ned Smith told the Metropolitan Council on Aug. 13 that staff are bringing forward a proposed 2026 operating budget of about $1.8 billion and recommended a 2% increase in the council levy to $97,980,000.

Smith said the council's levy authority is split across non‑debt service (general purposes), debt service for transit and parks, and levies tied to the seven‑county region and transit capital. He described the implicit price deflator — the state measure tied to allowable non‑debt levy growth — and said the council has historically targeted a 2% increase in its levy as a policy goal.

Transportation and Metro Transit: Transportation is the largest portion of the council’s operating budget. Transportation operating sources presented by staff totaled roughly $1,051,000,000. Leslie Ganderas, Metro Transit general manager, described Metro Transit Forward as the agency’s strategic framework and said the 2026 budget aligns with it. Ganderas noted the system is opening three bus rapid transit lines this year — the Gold Line (opened March), the B Line (opened June) and the E Line (scheduled for December) — and said staff are preparing for the Green Line extension opening in 2027.

Environmental services and rates: Lisa Thompson, general manager of environmental services, said the division treats about 250,000,000 gallons of wastewater daily for more than 2,000,000 residents across 111 communities. Environmental services proposed a 5.8% municipal wastewater charge increase for 2026 and said industrial waste‑strength charges would increase about 8.1%. Thompson and finance manager Matt Salmyer said the sewer access charge (SAC) connection fee has been held flat for 12 years and that staff plan to use $3,000,000 from the SAC reserve to fund pay‑as‑you‑go capital in 2026.

Community development: Lisa Barajas, executive director of community development, summarized planning, housing and grants work tied to Imagine 2050, HUD and state programs. Barajas said the council’s housing and redevelopment authority recently achieved 100% utilization of housing choice vouchers and a 50th anniversary of providing rent assistance. Staff noted federal funding uncertainty and a new state rent assistance program expected to bring vouchers on in 2026.

Budget composition and reserves: Smith said roughly 60% of the levy supports debt service — mostly for transit — and the general purpose levy provides $19,800,000 of flexible funding for council responsibilities. He said the council’s unassigned operating reserves were “well above” targets and that other post‑employment benefits (OPEB) are fully funded. Environmental services’ SAC reserve balance was presented at about $120,700,000.

Next steps: Staff characterized the presentation as an informational step. They said staff will present capital program details in October and that the council will consider adoption steps later in the fall as public comment opportunities are scheduled.

Provenance: Budget discussion begins with Ned Smith’s overview (transcript block starting at 1205.6599) and continues through division presentations concluding near the end of the meeting (transcript block starting at 4911.085).