Cottage Grove adopts 2025–26 budget after debate over audit, gaps and road funding

After a prolonged debate about process and fiscal prudence, the Cottage Grove City Council adopted the 2025–26 budget (resolution 2170).

Councilors raised concern that the budget committee had asked staff and council to reduce a projected 16% gap in expenditures versus revenues over three years and seek a one-third reduction in the first year. Councilor Lammerman said she did not feel comfortable approving the budget without completed audits and more detailed line-item review; other councilors urged prompt adoption to meet the state's statutory deadline and noted staff would bring a July agenda item with concrete recommendations to reduce the gap.

City Manager Sauerwein said the city has contracted audit work underway for prior years and that staff will present gap-reduction proposals at the first July meeting. Multiple councilors and staff discussed road funding options, regional partnerships and longer-term strategies to increase water sales and reduce pressure on rates.

The council called the roll and approved the resolution adopting the budget. The roll call recorded a majority of 'Aye' votes and at least one 'No' vote (Councilor Lammerman). City staff said audits are in progress and that staff will return with recommended actions to reduce the budget gap and provide quarterly budget updates to the council.