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Deephaven council reviews 2026 draft budget, asks staff to pare preliminary property tax levy
Summary
City staff presented a $4.88 million preliminary levy — a 14.63% increase from 2024 — and the council asked staff to identify about $197,000 in spending cuts or revenue increases to bring the proposed levy below a 10% rise.
City Administrator and special counsel Dan Madsen reviewed the draft 2026 General Fund, Capital Improvement and Debt Service budgets and presented a Preliminary Levy of $4,879,485.06, a $622,599.41 (14.63%) increase over the 2024 levy of $4,256,885.65. Mayor Pro Tem Emily Scherschligt and councilmembers discussed the size of the proposed levy and its impact on taxpayers.
The council said it wants the preliminary levy increase to be in single digits and instructed staff to present options to reduce the levy by roughly $197,000 — lowering the total to about $4,682,485 (a 9.997% increase) — through a mix of expense cuts and revenue options. No formal vote was taken; the discussion was listed as workshop business for staff follow-up.
Madsen emphasized that the difference between projected revenues and expenses is the amount that must be covered by property taxes to fund municipal operations in 2026. Council members signaled willingness to consider moving or delaying capital items, trimming operating budgets, or identifying additional revenue to reach the requested target.
Next steps: staff will return to the council with specific options to reach the below-10% preliminary levy target ahead of the formal levy-setting schedule.
