Agenda - Council - 07/28/2026 - Laserfiche WebLink

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Ms. McDermott confirmed that all three apartments would remain affordable housing units with rents based on qualifying income levels. She said the organization plans to have at least one apartment ready when the building opens and complete the remaining units within the following year. However, the goal is to have all three available sooner if possible. As the discussion concluded, several Councilmembers voiced their support for the proposal. Mayor Heineman said the Council had reached a consensus to move the purchase agreement and the Local Affordable Housing Aid funding request forward for formal consideration during the regular City Council meeting later that evening. 2.01: Preliminary 2027 General Fund Budget/Levy Discussion Finance Director Lund explained that the workshop was intended to provide the Council with an early look at the 2027 budget and gather direction before the proposed budget is prepared. She said the Council's feedback on an acceptable property tax levy increase would help guide staff as they develop the budget over the coming months. Ms. Lund explained that, before considering any new staffing or capital requests, the City was already facing an estimated 4 percent levy increase due to ongoing operating costs, debt service, and previously approved commitments. She noted that each 1 percent increase in the levy generates about $233,000 in additional revenue and reviewed several examples to help illustrate the financial impact of future budget decisions. Ms. Lund also explained that revenues from Tax Increment Financing District No. 14 are beginning to repay earlier interfund loans, creating additional funding options for some capital projects. She said staff will continue balancing the use of levy funds, Tax Increment Financing revenues, the Capital Equipment Fund, and Core HRA resources as the budget is developed. She emphasized that all staffing and capital requests remain preliminary and are presented for discussion only. Ms. Lund introduced the personnel requests, explaining that staff had separated them into position reclassifications and new positions. She invited each department director to explain the need for their requests. Building Inspector II Reclassification Community Development Director Hanson requested that an existing Building Inspector position be reclassified to Building Inspector II. She explained that the request would not add staff but would recognize an experienced employee who has taken on additional responsibilities, including commercial inspections, plan reviews, mentoring other inspectors, and serving in a leadership role when needed. She said the reclassification would improve employee retention and is consistent with similar positions in neighboring communities. The Council agreed that retaining experienced inspectors benefits both residents and development projects. City Council Work Session / July 14, 2026 Page 4 of 14