Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Budget Levy topic
No spam. Unsubscribe anytime.
Albert Lea City Council adopts preliminary 2026 budget and sets preliminary levy at 8%
Summary
The Albert Lea City Council approved a preliminary 2026 general fund budget with a preliminary property tax levy of $9,469,700 (an 8% increase over 2025). Councilors and staff said personnel costs, workers’ compensation and the Minnesota paid leave program are the primary drivers; the levy can be reduced but not increased before final adoption in December.
The Albert Lea City Council voted to adopt the 2026 preliminary general fund budget and set a preliminary property tax levy of $9,469,700, representing an 8% increase over the 2025 final levy.
City Manager introduced the resolution and turned the presentation over to Finance Director Christy, who said: “The levy is currently at an 8% increase over the 2025 final tax levy.” Christy told the council the budget projects roughly $1 million in additional revenue for 2026, of which about $742,000 is expected to come from the levy. She said the city’s revenue mix is about 32% local government aid, 31% property taxes, 16% charges for services, 12% transfers from utility funds and 9% franchise fees.
Christy and the city manager walked council members through expense drivers: approximately $1 million of the projected expense increase is for personnel, reflecting the final year of implementation of a compensation and classification study, higher workers’ compensation costs and the start of the Minnesota paid leave program. The presentation broke out 2026 spending by department: about 44% public safety (police, fire, building inspection), 20% culture and recreation, 16% public works, 14% general government and 6% fund transfers for capital purchases.
Christy noted tax-rate mechanics: the preliminary tax rate for 2026 is estimated at 55.775 and staff showed examples of taxpayer impact. Using the city’s preliminary figures, a $100,000 property would see an estimated $44 decrease in taxes if its taxable value held steady; if a property’s market value rises with the increased tax capacity, taxes could increase. Christy stressed those numbers are preliminary and that the levy may be reduced before the December final adoption but cannot be increased.
Council discussion focused on options to reduce the levy and the reasons for recent personnel-driven expense growth. Councilor Holland said she would support the preliminary adoption tonight but warned: “If it’s not reduced, I will vote no in December,” and urged staff to seek significant reductions toward the council’s historical 5% target. Council members thanked staff for the work and pressed for continued line-by-line review, noting potential offsets from lower-than-expected workers’ compensation or other revenue adjustments later this year.
The motion to adopt the 2026 preliminary budget and levy was moved by Councilor Christensen, seconded by Councilor Anderson and carried on a roll-call vote. The council also discussed continuing budget committee work through October and November and will return to final adoption and fee schedule decisions at the Dec. 8 meeting.
What happens next: the council may lower the levy but may not increase it before final adoption in December; staff will continue reviewing revenues, workers’ compensation estimates and enrollment numbers to seek potential reductions.
