Get AI Briefings, Transcripts & Alerts on Local & National Government Meetings — Forever.
Minnetonka staff propose near 7.9% 2026 levy increase; public safety and staffing are main drivers
Summary
City staff presented a 2026 all‑funds budget (~$124M) and a proposed levy increase around 7.87% driven largely by staffing (COLA/market adjustments), public safety master‑plan investments and a planned shift into debt service for capital; council discussed tradeoffs and priority‑based budgeting.
City Manager Mike Funk opened the budget segment with an all‑funds snapshot: "all of our funds combined is about 124,000,000," and staff outlined five fund buckets that together compose the city's budget. Finance Director Darren Nelson and Funk walked council through the eight‑month budget process and the core drivers pushing the 2026 proposed levy higher.
Staff quantified key drivers: compensation (COLA and market adjustments) was shown as adding roughly 2.6% to the levy; health insurance and the city’s share of the Minnesota Paid Family and Medical Leave Act were noted as separate line items; one new legal‑department paralegal position was identified as supporting police prosecution/civil caseload. Together, staffing‑related costs and baseline inflation contributed about a 4.7% 'business as usual' levy impact.
Funk described additional council decisions that raise the levy further: a planned $200,000 annual supplement for the ice arena and $200,000 for the Marsh operations (combined +0.7%), public safety master‑plan investments (~2.7%) and a proposed $400,000 transitional levy deposit to smooth future bond debt service (+0.7%). Combining these elements produced the staff recommendation of roughly a 7.87% levy increase for council consideration.
Council discussion focused on values and tradeoffs. Several councilmembers said the number made them uncomfortable but supported the public safety investments; options discussed to lower future levies included reducing scope, reprioritizing capital projects, or deferring non‑essential community center improvements in favor of Fire Station 2. The mayor asked staff to re‑examine fees the city charges other jurisdictions (for example, election services) and to look for potential revenue or efficiency opportunities, though staff said such adjustments would not materially reduce the 2026 levy.
Staff also highlighted that the city uses grant revenue and transfers (a $2.5M transfer to capital this year) to offset some levy pressure, and reminded council of a public hearing on Dec. 8 to accept final public comment and consider levy adoption. No formal action or vote took place during the study session; staff will refine the numbers and return with final recommendations at the December meeting.
