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St. James holds Truth and Taxation hearing; proposed levy trimmed to 6.5% increase
Summary
At the Truth and Taxation hearing the city presented its proposed 2026 budget and property tax levy (roughly $1.6 million); staff said they reduced the preliminary levy from 7.85% to about 6.5% after cuts and highlighted rising health insurance and COLA costs as major expenditure drivers.
City staff opened the Truth and Taxation hearing and summarized the proposed 2026 general fund budget and property tax levy, saying the proposed levy totals roughly $1.6 million and that the preliminary 7.85% increase was lowered to about a 6.5% increase through budget adjustments.
Staff outlined major levy components: a housing demolition fund ($20,000), a capital expense levy ($20,000), an airport levy ($75,000), a reduced pool operating levy ($20,995), and a debt payment for Second Avenue South improvements ($62,850). The presenter said the city's general fund balances and transfers constrained further reductions.
Officials said health insurance costs came in higher than projected (estimated at 18% vs. an expected 10%) and that previously negotiated cost-of-living adjustments were fixed obligations; those two items were cited as the primary drivers for the increased expenditures in the general fund. The presenter also summarized capital and maintenance needs across departments, including gutters for city hall (about $5,000), police station exterior repairs, street department garage repairs, and long-term planning for a pool slide replacement.
Staff presented a multi-year summary showing utilities as the largest portion of the city's overall budget and displayed an $18.7 million total across funds on planning slides. The presenter said the city's Local Government Aid (LGA) history has varied, noting recent increases but warning that if state LGA does not increase sufficiently more of the burden falls to property taxes.
The hearing was opened for public comment and then closed; council will adopt the final levy and budget at a subsequent meeting, with the county auditor's certification due Dec. 29, 2025.
