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Brainerd Public Utilities Commission approves 2026 operating and capital budgets, flags reliance on grants and crypto revenue
Summary
The Brainerd Public Utilities Commission approved the 2026 operating and capital budgets and recommended them to city council, outlining $40.3 million in revenue, major capital projects across electric, water and wastewater, and reliance on $5 million in state funding and recurring lead‑service grants; commissioners also discussed crypto sales revenue and ratepayer exposure.
The Brainerd Public Utilities Commission voted to recommend the 2026 operating and capital budgets to Brainerd City Council after staff outlined the utilities' five‑year priorities and financials.
Staff said total revenue across all divisions is budgeted at $40.3 million and total expenses at $40.08 million, leaving a modest positive change in net position of $243,000 for 2026. Major capital investments include hydropower roof and generator work, a $2.825 million reclamation/backwash construction project (2026–27) supported by a $5 million state appropriation, a planned Well No. 9 construction in 2027 at an estimated $5 million, and a $58 million water‑treatment plant planning program staged beginning in 2028.
"These projects strengthen system reliability and extend the useful life of our renewable hydro generation asset," staff said during the presentation. Commissioners pressed staff on funding sources and were told $5 million has been secured for the reclamation tank and $2.66 million is available from the Public Facilities Authority (PFA) for lead service line replacements, with an expected additional $2.5 million in 2027; staff said remaining costs will fall to ratepayers or be financed through bonding.
Commissioners also questioned assumptions about non‑rate revenue. When asked whether crypto‑mining or crypto sales are included in the electric revenue line, staff said the budget assumes crypto sales of about $8.4 million in 2026, roughly the average of 2024–25 levels. One commissioner warned, "That's scary," and staff acknowledged that a sudden stop in that revenue would create a significant shortfall.
The commission moved and approved a motion to recommend the capital and operating budgets to the city council; the motion passed by voice vote. Staff will present the budgets to council at the city's first December meeting.
Next steps: staff will present the package to Brainerd City Council for final adoption and continue to refine project funding, including bonding requests and grant applications.
