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Cottage Grove council adopts 2026 property tax levy and 2026 budget; vote 3–1
Summary
The Cottage Grove City Council on Dec. 3 approved the property tax levy payable in 2026 and adopted the citybudget for 2026, increasing the city portion of the levy from $25,990,600 to $29,885,000 and approving new levies for EMS and equipment replacement. Council approved the measures after public hearing and discussion; votes on the levy and budget were 3to1.
The Cottage Grove City Council on Dec. 3 adopted the property tax levy payable in 2026 and approved the citybudget for 2026 after a public hearing and council discussion.
Finance Director Brenda Milanowski told the council the overall tax bill on a median Cottage Grove home (market value cited at $369,200) under the proposed levies would be $4,684 in 2026 and that "the City portion, the $25,990,600 is increasing to $29,885,000." She outlined new levy components included in the package: an EMS levy to help cover rising ambulance costs, an increased equipment levy to fund roughly $2,000,000 a year in equipment replacement, and a $150,000 increase for municipal building needs and security upgrades. Milanowski said the city intends to preserve current service levels for police, fire, public works and parks and that the general fund remains balanced.
Council members pressed staff on specific drivers of the increase. Councilmember Claussen and others emphasized aging capital assets and a backlog of deferred equipment purchases, noting examples including a 30-year-old fire truck and a 35-year-old road grader identified in the budget discussions. Council members also raised concerns about EMS reimbursement shortfalls, with the mayor saying Medicare and Medicaid payments do not keep pace with the true cost of ambulance responses.
After the hearing and deliberations, the council moved three resolutions on the record: adopting the property tax levy collectible in 2026, adopting the 2026 budget, and adopting the Housing and Redevelopment Authority tax levy collectible in 2026. The transcript records the votes on the property tax levy and the 2026 budget as passing 3 to 1; the HRA levy also passed. The councilalso reaffirmed an EDA action that reduced the levy impact by decertifying a TIF district, which city staff said will lower the median-home change by roughly $17 and reduce the levy increase by about 1.3 percentage points.
The council and staff said next steps include forwarding the adopted levy to the county, finalizing the budget implementation steps and continuing intergovernmental discussions about EMS funding and potential cost-sharing with neighboring communities.
This decision follows a multi-month budget process the city began in January; Milanowski said staff used a 10-year financial management plan to guide capital and equipment-replacement decisions.
