HomeMy WebLinkAbout01(A) - 2026 Preliminary Budget & Property Tax Levy Report
City of Prior Lake | 4646 Dakota Street SE | Prior Lake MN 55372
CITY COUNCIL AGENDA REPORT
ITEM: 1A
MEETING DATE: July 22, 2025
PREPARED BY: Jason Etter, Sr. Financial Analyst
Christine Watson, Public Works Supervisor – Administration
Nicole Klekner, Interim Finance Director
Cathy Erickson, Finance Director
PRESENTED BY: Nicole Klekner
AGENDA ITEM: 2026-2030 Capital Improvement Program Draft
RECOMMENDED ACTION:
The Council is asked to provide comments on the draft Capital Improvement Program (CIP) so
the CIP process can proceed on schedule. The CIP plans are as follows:
• Equipment Replacement Plan
• Park Plan
• Facilities Management Plan
• Pavement Management Plan
• Technology Plan
Utility Funds
• Water Financial Plan
• Sanitary Sewer Financial Plan
• Water Quality Financial Plan
This work session will also include the financial analysis of the CIP plans. The draft summary
documents have been included for City Council review.
BACKGROUND:
At the June 24 work session, staff presented Part 1 of the CIP which was a presentation of the
projects in equipment, park, facilities, and pavement management plans. Part 2 of the CIP will
be a presentation of the following:
• Utility funds financial plans, including proposed rate changes
• CIP financial impacts: debt analysis and tax impact
UTILITY FUNDS – FINANCIAL MANAGEMENT PLANS
The City’s utility funds finance their portions of the Capital Improvement Program through
transfers-out to other funds and by transactions occurring within the specific utility funds
themselves. The utility funds make transfers-out to the Construction Fund for their portions of the
Pavement Management Plan (PMP) projects. Other items that specifically relate only to that utility
are accounted for within the fund, such as a water tower rehabilitation occurring in the Water fund.
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Staff develop a financial management plan for each utility fund that includes planning financing
sources for capital activities.
The financial management plans for water, sewer and stormwater utility services achieve the
following goals:
• Rate Calculation: Provide a rate calculation that results in equitable and competitive fixed
versus variable portion charge to customers and considers conservation impact of tiers
and block rates.
• Revenue Sufficiency: Focus on revenue sufficiency to provide cash balances that support
the following objectives:
o Revenue to meet current and future obligations.
o Avoid future debt issuance consistent with City objectives.
o Cash on-hand to provide:
Three-months of operating expense
Following-year debt service payments
Following year capital acquisition (planned to be paid from cash)
Reserves for replacement of infrastructure located under private streets
Reserves for future capital improvements
2026 Resident Impact and Sample Bill:
The City plans for annual increases in utility rates to accomplish the objectives discussed above
while moderating the effects on utility users. Based upon the City’s current estimates and water
consumption level and utility replacement component of street projects, utility customers will
experience increases of 4.9-5.1% in their 2026 utility bill based on their level of water use.
For the utility funds to support operations and their respective portions of the Capital Improvement
Program, funding is achieved through rates charged and/or debt issuance over the 10-year
planning period.
To achieve this, the following rate increases are proposed for 2026 (medium water user):
Sewer fee details: The increase in sewer fee is due to $9M in planned project spend over the next
3 years as well as the council direction to avoid debt issuance when possible and instead increase
rates. The proposed sewer increase for a residential property (median user) at 7.3% would be
$45.15 per year or approximately $4 per month.
MCES fee details: It should be noted that City utility bills also include an MCES Fee for sewer.
This fee does not support City operations or the Capital Improvement Plan, but rather is a fee
collected by the City from residents to pay the Metropolitan Council’s Environmental Services fee
for regional wastewater treatment. The fee will increase 3.45% for 2026, reflecting the increased
Fund
2026 Proposed
Rate Increase
Annual
Impact
Monthly
Impact
Water 3.0% 17$ 1.42$
Sewer 7.3% 45$ 3.75$
Stormwater 3.0%5$ 0.42$
Combined Total 5.0% 67$ 5.58$
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fee that the Metropolitan Council is charging Prior Lake. This fee increase, as well as the utility
rate increases needed to support operations and the Capital Improvement Plan is reflected below.
The projected annual increase for all utility services is shown below:
Sample Bimonthly Utility Bill:
These projected increases are slightly less than what was presented to the City Council last year
for 2026.
The Water, Sewer and Water Quality Financial Management Plan Cash by Purpose, projected
change in rates and CIP are shown on Attachment 1, 2, and 3.
FINANCIAL IMPACT:
CIP Impact on Long Range Financial Plan:
The financial plan incorporates the debt and tax levy impacts of the Capital Improvement
Program. Approval of the CIP does not obligate the city to complete the proposed projects or
purchases. The 2026 projects/proposed purchases will be incorporated into the 2026 budget
requests for budgeted funds. Further Council approvals may be necessary to comply with state
statutes and the City’s purchasing policy.
The City’s financial planning reflects funding general operations, future planned capital
improvements, including related debt service on planned bond issuance to support capital
improvements for streets, equipment replacement and facilities capital maintenance projects.
Debt repayment is based on level annual debt service payments.
As part of the City’s financial planning, the City is planning for a Park referendum in Fall 2025 for
$60M in park improvements. If approved by the voters, approximate bonding needs/projects
would be spread over six years (2026-2031) for community parks and neighborhood
improvements. This would provide funding for park improvements at Spring Lake Park, Lakefront
Park and neighborhood parks and trails.
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Funding for proposed projects in the CIP results in an estimated 10-year average tax rate increase
of 4.2%. This is in line with the parameters established in the City’s 2023 financial planning study.
Any modifications to the CIP are reflected in the annual update of the CIP and City’s financial
plan.
The estimated tax levies and tax rate projections for the city’s five-year financial plan are shown
below.
Conclusion:
The City has been working over the last several years to document its assets and plan for major
maintenance or replacements. As these documents have been refined, the financial impacts of
our needs are putting pressure on our funding mechanisms given our current funding levels. A
much-needed funding source in the plan includes debt issuance for major park improvement
projects.
The City Council is asked to provide Staff with comments and input on these components of the
draft CIP so that they can be refined in preparation for the City’s financial planning, public review
and approval process.
A public hearing before the City Council is scheduled for the proposed CIP on Tuesday, August
12, 2025.
ATTACHMENTS:
1. Attachment 1 - Water Fund
2. Attachment 2 - Sewer Fund
3. Attachment 3 - Stormwater Fund
4. Attachment 4 - Debt and Tax Impact of CIP Updated for7.22 level annual debt service
CITY PROPERTY TAX PROJECTION - INCLUDING PARK IMPROVEMENT BONDS
2025 2026 2027 2028 2029 2030
TAX LEVIES
General Fund Levy - Tax Capacity 14,848,732 16,238,411 17,660,526 19,264,383 20,425,810 21,695,077
General Fund Levy - Market Value 262,488 265,888 273,988 281,638 283,838 290,738
Debt Service Fund (not incl Park Improvement Bonds)2,929,190 3,031,056 3,648,002 4,037,676 4,211,165 4,077,930
Debt Levy (Park Improvement Bonds Only)470,838 1,766,767 1,903,484 3,197,954
CIP Funds 1,815,000 1,825,000 1,985,000 2,185,000 2,355,000 2,505,000
Total Tax Levies 19,855,410 21,360,355 24,038,354 27,535,464 29,179,297 31,766,698
Annual $ Change 1,859,077 1,504,945 2,677,998 3,497,111 1,643,832 2,587,401
TOTAL % CHANGE IN TAX LEVIES - including Park Imp Bonds 6.2%7.6%12.5%14.5%6.0%8.9%
CITY TAX CAPACITY TAX RATE- No Park Improvement Bonds 31.43%34.05%36.39%37.24%37.68%
Annual % Change 3.03%8.35%6.86%2.34%1.20%
CITY TAX CAPACITY TAX RATE- Including Park Improvement Bonds 31.43%34.78%39.04%39.99%42.15%
Annual % Change 3.03%10.67%12.26%2.44%5.38%
Debt per Capita - No Park Improvement Bonds 853 967 1,039 1,380 1,420 1,463
Debt per Capita - Including Park Improvement Bonds 853 1,143 1,734 2,231 2,763 2,937
Bonds Outstanding - No Park Improvement Bonds 24,145,000 27,510,000 29,725,000 39,650,000 41,080,000 42,620,000
Change in Bonds Outstanding 3,365,000 2,215,000 9,925,000 1,430,000 1,540,000
Bonds Outstanding - Including Park Improvement Bonds 24,145,000 32,510,000 49,615,000 64,100,000 79,960,000 85,580,000
Change in Bonds Outstanding 8,365,000 17,105,000 14,485,000 15,860,000 5,620,000
Five Year Planning Period
City of Prior Lake | 4646 Dakota Street SE | Prior Lake MN 55372
CITY COUNCIL AGENDA REPORT
ITEM: 1A
MEETING DATE: July 22, 2025
PREPARED BY: Cathy Erickson, Jason Etter and Nicole Klekner
PRESENTED BY: Cathy Erickson and Nicole Klekner
AGENDA ITEM: 2026 Preliminary Budget & Property Tax Levy
The purpose of this report is to provide the City Council with an overview of community growth,
proposed 2026 property tax levy, property tax supported-funds, bar chart of primary drivers of the
revenues and expenditure changes in the General Fund as well as the impact of such on the
median valued home and fund balance reserves.
City staff have been preparing their 2026 budget requests over the past few months. The
proposed budgets reflect additional resources needed for the following areas:
• Community Growth
• Proposed personnel funding for a Network Administrator, Police Sergeant, and Police
Records Specialist.
• Unfunded mandates (MN paid leave program, election absentee voting equipment, ADA
compliance for website)
• Reduction in the rate of residential development (Prior Lake is still experiencing
community growth, but at a slower rate than the previous several years is anticipated.)
• Commodities – inflationary increases
Community Growth
The City of Prior Lake has experienced significant growth during these past ten years. Since
2016, growth from new construction has added $3 billion to the taxable market value of which
$1.6 billion or 53% of the growth has occurred in the past five years. The following chart
provides a breakdown of that growth:
Type 10-Yr Growth % Change 5-Yr Growth % Change
Residential $2,667,105,056 88.7% $1,403,264,870 88.4%
Commercial/Ind 160,060,000 5.3% 96,789,600 6.1%
Apartments 194,820,295 6.5% 70,750,895 4.5%
Other (15,062,384)
-0.5% 17,166,886 1.1%
Total $3,006,922,967 100.0% $1,587,972,251 100.0%
The population has grown from 25,863 in 2016 (census.gov) to approximately 29,060 or 12%.
As we grow, this also increases the amount of traffic and number of people requiring services
from the City (i.e. streets, parks, police, fire, recreation etc.)
Preliminary taxable market values have increased $259 million or 4.6% from 2025 to 2026, of
which approximately $38 million is from new construction. Based on the 2025 tax rate, new
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construction tax capacity of $1.1M will generate about $345,000 in property taxes. This equates
to about 1.6% of the 2026 property tax levy.
City Tax Rate
The city has been fortunate to keep its tax rate low. Since 2020 the tax rate has declined from
32.49% to 30.50% in 2025. The 2026 proposed tax rate is 31.43%. The six-year reduction in tax
rate is primarily due to new construction growth each year and an overall valuation increase of
20% made by the Scott County Assessor’s office in 2023. The 2023 tax rate, at 28.11%, is the
lowest tax rate in the past decade, however, this is not sustainable to provide city services. If the
tax rate were maintained at the 2022 level, approximately $1.3 million in additional revenues
would have been generated annually to fund city services, including equipment replacement,
facility improvements, pavement management etc.
Proposed Property Tax Levy
The following chart provides a guide for establishing the 2026 tax levy based on factors that
impact the Prior Lake community:
*Used March YTD wage growth of 4.3% as 72% of city budget is personnel costs.
Growth (New Construction)1.6%
Wage Growth *4.3%
Debt Service 0.9%
Unfunded Mandates 0.6%
Total 7.4%
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Unfunded Mandates:
MN Paid Leave – Minnesota’s new Paid Family and Medical Leave program starts on 1/1/26. The
program is funded by premiums paid by both employers and employees. The premium rate will
be 0.88% for 2026, which will be split 50/50 between the City and employees. The total estimated
City cost for 2026 is $64k.
Election absentee voting equipment – Scott County has recommended that all cities purchase
additional equipment for our absentee ballot tabulators that allows ballots to be scanned at a high
speed. The City has budgeted $30k to purchase this equipment in 2026.
ADA compliance for website – The City is required to follow the Americans with Disabilities Act
(ADA) requirements for the City website by 2027. In order to achieve this goal, the City has
budgeted $40k for professional services for software design in 2026.
There are budget assumptions outside of the base tax levy considerations noted above, that are
included in the levy request:
Economic Slowdown/Recession: Non-tax revenue from residential building permits/fees
budget is $117k less than the 2025 budget. Prior Lake is still growing, but new residential units
are estimated at 50 units (50 single family/0 townhomes) for 2026 as compared to the budget of
80 units (60 single family/20 townhomes) for 2025.
Costs higher than CPI: The US Inflation Calculator for May 2025 indicates a CPI of 2.4% (US
Inflation Calculator and U.S. Bureau of Labor Statistics). There is general concern regarding the
inflationary impact on the economy due to rising labor and contractual service costs.
Historically, budget items that fall under contractual agreements such as our labor contracts,
health insurance premiums, salt/ice management materials, and technology have seen increases
greater than the area CPI. Preliminary data indicates we may see a 15% increase in our
healthcare premiums and a 10% increase in dental premiums. March YTD wage growth is 4.3%,
which is 1.9% higher than the inflation rate of 2.4%. The growth of wages surpassed that of
inflation in February of 2023. 72% of the city’s general fund budget is personnel costs.
Staffing adds:
The Five-Year Personnel Plan includes funding the following staff additions for 2026:
• Network Administrator (1 FTE) This position will assist in the management and oversight
of the city’s IT infrastructure, networks, server operations, security systems, and software.
The Network Administrator could assume many of the higher-level technical aspects of
the city’s IT needs so the IT Manager can focus on developing a cyber security program
and policies, budgeting, long-range planning, researching products and devices while also
providing technical support. This position is budgeted to start to July 2026.
• Police Sergeant (1 FTE). The recent workload study identified the addition of a seventh
supervisor as the highest priority for the police department. This would allow sergeants to
perform administrative functions, manage training efforts, and develop patrol officers,
including monitoring performance and addressing performance issues; instead of taking
on primary response roles.
• Police Records Specialist (1 FTE). The workload on the records staff has increased
markedly with the addition of several sworn officers since 2019; however no additional
staff have been added to that workgroup to adjust to the workload. Additionally, increased
data practices requests, video redaction needs, and State mandated law changes have
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compounded the daily tasks and volume of work of the records staff. With an extensive
backlog of criminal justice data needing to be addressed as well as falling behind on daily
data needs, there is an urgent priority to bring the records group to a higher staffing level.
See attachment 1 for the budget overview. To fund the present assumptions in the proposed
2026 budget, a preliminary city tax levy increase of 7.6% is needed. The proposed 2026 city
property tax levy is comprised of the following components:
Fund Proposed 2026
Levy
Change
from 2025 ($)
General Fund $16,238,411 $1,389,679
Debt Service Fund 3,296,944 105,266
Equip Revolving Fund 925,000 (100,000)
Revolving Park Equip Fund 595,000 60,000
Facilities Mgmt. Fund 305,000 50,000
TOTAL LEVY $21,260,355 $1,504,945
The proposed 2026 tax levy is a 7.6% increase over the 2025 tax levy. The estimated tax capacity
rate is 31.43%, which equates to a 3% increase from the 2025 tax rate of 30.50%.
The budget drivers of the levy change are shown below:
2025 2026
Amended
Budget
Preliminary
Budget
SUMMARY OF CHANGE IN TAX LEVIES
GENERAL FUND
NON TAX REVENUES
Franchise fees 555,000 528,000 (27,000) Mediacom reduction based on 2024 actual
Charges for services 1,240,722 1,313,290 72,568
Increases: City contracted svc of $53k, Project admin/eng fees of $35k, Tower leases of $16k
Reductions: Plan check fees of $46k
Intergovernmental revenue 3,712,834 3,908,388 195,554
Increases: State aid for Fire Relief Association - (passthrough) $39k, State aid for Police
$60k, Township fire aid $130k based on cost-sharing agreement, State road and bridge aid
$76k
Reduction in capital grants ($106k)
Licenses & permits 550,842 472,710 (78,132) Reduction in building permit fees of $71k due to construction slow-down
Fines & forfeitures 108,000 108,000 -
Miscellaneous revenues 381,300 424,800 43,500 Increase in interest earnings of $36k
Transfer in from other funds 615,000 668,000 53,000 Slight increase in operating transfers from utility funds
MV Debt Service Levy
Total Non Tax Revenues 7,163,698 7,423,188 259,490
EXPENDITURES AND OTHER USES
Current expenditures (6,235,401) (6,158,513) (76,888)
Reductions: Professional Services ($286k) in Engineering, Parks and HR, Fuel ($30k)
Increases: Utilities (gas/electric) $35k, Software Service Contract $92k, Uniforms/PPE $20k,
Maint agreements $41k
Personnel (16,112,929) (17,305,086) 1,192,157
Includes COLA/STEPS of $378k,PERA/TAXES of $94k, $346k for funding new positions, $271k
for health insurance increase, $54k for MN Paid Leave
Capital Outlay (123,610) (198,000) 74,390 SAN and server replacement
Total Expenditures and Other Uses (22,471,940) (23,661,599) 1,189,659
-
Use of Fund Balance (459,510) 459,510 Council approved budget amendments
GENERAL FUND 14,848,732 16,238,411 1,389,679
DEBT SERVICE FUNDS 3,191,678 3,296,944 105,266 Net of reduction of exisitng debt plus estimated new debt service for current yr bond issue
CAPITAL FUNDS
Revolving Equip Fund F410 1,025,000 925,000 (100,000)
Revolving Park Equip Fund F430 535,000 595,000 60,000
Facilities Mgmt Fund F440 255,000 305,000 50,000
OTHER FUNDS 1,815,000 1,825,000 10,000 Based on project needs in the Capital Improvement Program
TOTAL LEVY BY YEAR AND CHANGE IN TAX LEVIES 19,855,410 21,360,355 1,504,945
Change from
Prior Year = Tax
Levy Need Description of Change
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Impact on Median Valued Home
52% of the homes in Prior Lake have seen an estimated increase in market value of 0.01%-5%.
For a median valued home of $433,600 the proposed increase in the property tax levy would
result in the city’s portion of the property taxes increasing by approximately $76. The annual
change in 2026 total taxes for a sample of property values is shown below.
FINANCIAL IMPACT:
City Proposed Levy
The proposed city tax levy is $21,360,355. This is a levy increase of $1,504,945 (7.6%). The
components of the proposed tax levy change based on the 2026 preliminary budgets are
summarized on attachment 3 and in the chart below.
RESIDENTIAL IMPACTS
% Net Net Net Net Net Net
of Inc/Dec Difference Inc/Dec Difference Inc/Dec Difference
Inc/Dec Total 25 vs 26 % Change 25 vs 26 % Change 25 vs 26 % Change
+15.01+%71 1%265$ 20.0% 415$ 21.4%699$ 20.1%
+10.01-15.00%49 1%227$ 17.2% 355$ 18.4%599$ 17.2%
+5.01-10.00%1,707 18%152$ 11.5% 236$ 12.2%401$ 11.5%
+0.01-5.00%5,055 52%76$ 5.8% 117$ 6.0%202$ 5.8%
No Change 630 6%39$ 2.9% 57$ 2.9%103$ 3.0%
-0.01-5.00%2,223 23%1$ 0.1%(3)$ -0.1%3$ 0.1%
-5.01 - 10.00%8 0%(74)$ -5.6% (122)$ -6.3% (195)$ -5.6%
-10.00 - 15.00%1 0%(149)$ -11.3% (241)$ -12.5% (394)$ -11.3%
-15.01% +7 0%(187)$ -14.2% (301)$ -15.5% (493)$ -14.2%
9,751 100%
% EMV Value Range
# of
affected
Properties
Median $433,600 $600,000 $1,000,000
2026 Budget / Tax Levy - July 22 Council Worksession
roposed Tax Levy Increase:
5.80%
$1,150,000
0.05%$10,000
1.73%$345,000
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%
Mandatory CIP -Tax Levy Components Personnel Adds
Total: 7.6% $1,505,000
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New Personnel Funding
The city’s current full-time equivalent (FTE) headcount is 122.02. It is proposed to increase by 3
FTE to 125.02 in 2026. See attachment 2 for Five-Year Personnel Plan.
• The 2026 budget includes new tax levy funding of $346k for a new Network Administrator
position (July 2026 start), and the addition of a Police Sergeant and a Police Records
Specialist. (Staffing needs detailed above and on attached Personnel Plan Attachment 2)
Capital Improvement Program (CIP) Funding
The Council has incrementally increased the tax levy to support the long-term plans of the Capital
Improvement Program with the goal of building cash reserves to minimize future debt and to meet
our capital replacement needs. Previous funding levels have not been enough to maintain our
capital replacement needs.
Mandatory Items Funding:
Staffing:
• The city has labor agreements with two unions that will be negotiated this fall for 2026.
The budget includes a proposed cost of living adjustment, step increases and mandatory
city payroll taxes and Public Employees Retirement Association (PERA) contribution
increases. This also includes the financial impacts of the compensation study for the
Police Department completed in 2025.
o COLA/STEPS: $425k
o PERA/SS/FICA: $59k
• Health and Dental Insurance estimated expenditure increase of $270k. The proposed
budget reflects a 15% increase in the health and a 10% increase in dental insurance
premiums. Updated premium increase information will be provided to the city in late
August.
Non-Tax Revenue Increase:
• Intergovernmental revenue is increasing by $196k compared to 2025. This includes:
o $131k increase in township fire/rescue aid based on the fire agreement
o $76k increase in state road and bridge aid
o $60k increase in police state aid
o Partially offset by decrease in capital grants of $106k
• Increase of $53k for City Contracted Services based on 2024 revenue plus increased
Police contracted rate due to 2025 compensation study.
• Increase of $35k for project admin/engineering fees based on the proposed projects.
• Increase in Transfer-In as a funding source of $53k. This is based on operating transfers
from the utility funds.
• Increase in interest earnings of $16k. Budget reflects anticipated earnings on investments.
• Revenue from residential building permits/fees budget is $117k less than the 2025 budget.
The city collects building permits and plan check revenue on new residential and
townhome units built. Prior Lake is still growing, but the 2026 estimate for new construction
units is 50 single family/0 townhomes (50 total) which generates less revenue than the
2025 budget mix of 60 single family/20 townhomes (80 total).
• Franchise fee revenue decrease of $27k.
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Current Expenditures/Capital Outlay:
The 2026 current expenditure budget is a decrease of $77k (1.2% decrease).
Supplies:
• $24k decrease in funding for supplies.
o This includes a $54k decrease for fuel and small equipment.
o There are offsetting increases of $29k in operating supplies, all repairs & maintenance
supplies, uniforms/PPE, etc.
Maintenance agreements:
• $56k increase in funding largely due to maintenance agreements including general,
building and equipment maintenance due to increases in fertilizer & weed spraying, trees
and vegetation, contracted mowing and graffiti removal services and new development
sealcoat.
Professional Services:
• $265k net decrease in professional services primarily to decreases in Engineering,
Human Resources, Police and Parks professional services needs compared to 2025.
Other Services and Charges:
• $156k increase in funding for other services and charges
o This includes a $92k increase for software service contracts primarily due to $40k
budgeted for ADA compliant website, $24k for new Police software, $18k for new
IT needs and $11k for new Recreation software implementation
o $34k increase in utilities (electric/gas)
o $16k increase in memberships/subscriptions, primarily for Fire, Administration and
Police
Capital Outlay:
• 2026 costs are estimated to be $74k more than the prior year. 2026 includes a high speed
ballot scanner recommended by Scott County ($30k) and IT increase of $80k to replace
SAN and servers, and switch replacement.
Other Levy Impacts:
• $460k change in use of reserves due to 2025 budget amendments.
• $105k increase in debt service compared to 2025.
EDA Proposed Tax Levy
The EDA budget includes funding for wages, property acquisition, and property taxes/
maintenance costs for EDA owned properties. The proposed budget does not include a funding
increase. The preliminary EDA tax levy remains at $405,000.
Fund Balance:
The Comprehensive Financial Management Plan recommends maintaining reserves in a range
between 40% and 50% of subsequent year expenditures.
The estimated year-end 2025 ending reserve balance is at 54% and the estimated year-end 2026
reserve balance is estimated at 51%. The preliminary 2026 budget does not include the use of
reserves.
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City Tax Levy and Tax Rate Projections:
The estimated tax levies and tax rate projections for the city’s five-year financial plan is shown
below.
The city’s financial planning reflects funding general operations, planned capital improvements,
including related debt service on planned bond issuance to support capital improvements for
streets, equipment replacement and facilities capital maintenance projects. The city is
considering future debt for park and recreation improvements of $60 million of bonds from years
2026 to 2031 for park and trail improvements. The city will seek taxbase approval through a voter
referendum in November 2025. Therefore, the tax levy and tax rate implications of potential park
improvement bonds is reflected in the city’s financial plan for City Council consideration. In total,
these funding needs result in an estimated 10-year average tax rate increase of 4.2%. This is in
line with the parameters established in the city’s 2023 financial planning study. Any modifications
to the planned budgets and CIP are reflected in the annual update of the financial plan.
Budget & CIP Schedule
Additional meetings/workshops (highlighted in blue) are currently scheduled to discuss and adopt
2026 property tax levies and budgets:
Aug 26, 5:00 pm Workshop – Additional Review of Preliminary Tax Levy and Budget,
if needed
Sept 23, 7:00 pm Meeting – Adopt Preliminary Tax Levy & Budget; Announce Public
Budget Meeting Date
Nov 11, 5:00 pm Workshop – Final 2026 Budget/Tax Levy Discussion
Dec 9, 7:00 pm Meeting – Public Budget Meeting (Truth in Taxation); Adopt 2026
Budget & Tax Levy; Adopt Fee Schedule
CITY PROPERTY TAX PROJECTION - INCLUDING PARK IMPROVEMENT BONDS
2025 2026 2027 2028 2029 2030
TAX LEVIES
General Fund Levy - Tax Capacity 14,848,732 16,238,411 17,660,526 19,264,383 20,425,810 21,695,077
General Fund Levy - Market Value 262,488 265,888 273,988 281,638 283,838 290,738
Debt Service Fund (not incl Park Improvement Bonds)2,929,190 3,031,056 3,648,002 4,037,676 4,211,165 4,077,930
Debt Levy (Park Improvement Bonds Only)470,838 1,766,767 1,903,484 3,197,954
CIP Funds 1,815,000 1,825,000 1,985,000 2,185,000 2,355,000 2,505,000
Total Tax Levies 19,855,410 21,360,355 24,038,354 27,535,464 29,179,297 31,766,698
Annual $ Change 1,859,077 1,504,945 2,677,998 3,497,111 1,643,832 2,587,401
TOTAL % CHANGE IN TAX LEVIES - including Park Imp Bonds 6.2%7.6%12.5%14.5%6.0%8.9%
CITY TAX CAPACITY TAX RATE- No Park Improvement Bonds 31.43%34.05%36.39%37.24%37.68%
Annual % Change 3.03%8.35%6.86%2.34%1.20%
CITY TAX CAPACITY TAX RATE- Including Park Improvement Bonds 31.43%34.78%39.04%39.99%42.15%
Annual % Change 3.03%10.67%12.26%2.44%5.38%
Debt per Capita - No Park Improvement Bonds 853 967 1,039 1,380 1,420 1,463
Debt per Capita - Including Park Improvement Bonds 853 1,143 1,734 2,231 2,763 2,937
Bonds Outstanding - No Park Improvement Bonds 24,145,000 27,510,000 29,725,000 39,650,000 41,080,000 42,620,000
Change in Bonds Outstanding 3,365,000 2,215,000 9,925,000 1,430,000 1,540,000
Bonds Outstanding - Including Park Improvement Bonds 24,145,000 32,510,000 49,615,000 64,100,000 79,960,000 85,580,000
Change in Bonds Outstanding 8,365,000 17,105,000 14,485,000 15,860,000 5,620,000
Five Year Planning Period
Item 1A
Page | 9
Council Direction
Staff are seeking direction regarding the 2026 property tax levy and underlying budgets.
ATTACHMENTS:
1. 2026 Budget Overview
2. Personnel Plan 2026-2030
3. Components of 2026 Proposed Tax Levy Change
4. 2026 Proposed Revenues and Expenditure Detail by Fund
Water Fund
Summary of Key Financial Information
Water Fund 2025
(estimate)2026 2027 2028 2029 2030 2031 2032 2033 2034
Cash by Purpose
For future capital improvements 5,167,347 4,521,248 2,348,043 1,835,637 2,289,972 1,525,188 31,987 76,268 1,664,285 2,961,899
For following year pay-go capital 3,640,000 1,260,500 3,580,500 2,131,000 1,300,500 2,685,500 4,260,025 419,076 1,982,155 1,983,763
For 3-months of operating cash 1,015,130 1,037,771 976,211 1,002,450 1,030,342 1,062,462 1,101,348 1,625,194 1,157,929 1,191,669
For following year debt service 791,950 801,700 810,450 645,350 652,650 659,200 - - - -
Ending Cash 10,614,426 7,621,218 7,715,204 5,614,437 5,273,463 5,932,350 5,393,361 2,120,538 4,804,370 6,137,331
High Volume Customer (78,000 gallons)3.0%3.0%3.5%3.5%4.0%4.0%4.0%3.0%3.0%3.0%
Medium Volume Customer (18,000 gallons)3.0%3.0%3.5%3.5%4.0%4.0%4.0%3.0%3.0%3.0%
Low Volume Customer (8,000 gallons)3.0%3.0%3.5%3.5%4.0%4.0%4.0%3.0%3.0%3.0%
Average Annual % Change in Water Bill for Billing Period
Water Fund
Capital Improvement Plan
Water Fund EstimateProject Description 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
Capital OutlayTransportation Plan 25,800 1,150,000 650,000 2,445,000 1,069,000 1,068,000 2,306,000 1,014,000 - 1,865,000 Meter Replacement Program - Software Upgrade - - - - - - - - - - Wells 57,500 60,000 50,000 52,000 65,000 65,000 67,500 140,000 72,500 75,000 Boosters and misc projects - 475,000 550,000 560,000 586,500 70,000 50,000 95,000 35,000 30,000 DT watermain upgrade 400,000 - - - - - - - - - Current Year Projects - Facilities 150,000 145,000 10,500 498,500 385,500 12,000 12,500 - - - Water Storage & Tower Reconditioning - 1,810,000 - - - - 24,000 - - - Technology Plan - SCADA - - - - - 10,000 10,500 11,025 11,576 12,155 Equipment 75,000 - - - - 75,500 215,000 - 275,000 - New Maintenance Center - Water Portion of Cost - - - - - - - 3,000,000 - - WTF Rehabs & Equipment 20,000 - - 25,000 25,000 - - - 25,000 - Total Capital Outlay 728,300 3,640,000 1,260,500 3,580,500 2,131,000 1,300,500 2,685,500 4,260,025 419,076 1,982,155
Source of FundsBond proceeds - - - - - - - - - - Current revenue / use of cash in fund 728,300 3,640,000 1,260,500 3,580,500 2,131,000 1,300,500 2,685,500 4,260,025 419,076 1,982,155 Total Source of Funds 728,300 3,640,000 1,260,500 3,580,500 2,131,000 1,300,500 2,685,500 4,260,025 419,076 1,982,155
Sewer Fund
Summary of Key Financial Information
Sewer Fund 2025
(estimate)2026 2027 2028 2029 2030 2031 2032 2033 2034
Cash by Purpose
For future capital improvements 1,088,807 659,366 2,565,440 2,442,431 1,322,256 3,320,455 2,786,942 2,140,798 5,154,980 2,775,738
For following year pay-go capital 2,708,000 2,432,000 - 2,997,000 3,075,000 - 5,331,025 - 3,160,155 4,030,763
For 3-months of operating cash 983,149 988,381 1,045,910 1,127,243 1,135,491 1,184,489 1,290,116 1,785,091 1,384,068 1,396,058
For following year debt service 162,500 165,500 168,000 497,325 394,550 391,900 1,055,408 917,700 1,517,603 1,390,492
Ending Cash 4,942,455 4,245,247 3,779,350 7,063,999 5,927,297 4,896,843 10,463,491 4,843,589 11,216,806 9,593,050
High Volume Customer (47,000 gallons)10.5%7.5%3.4%3.4%3.4%3.4%3.4%3.4%3.4%3.4%
Medium Volume Customer (12,000 gallons)10.1%7.3%3.4%3.4%3.4%3.4%3.4%3.4%3.4%3.4%
Low Volume Customer (7,000 gallons)10.8%7.7%3.3%3.3%3.3%3.4%3.4%3.4%3.4%3.4%
Average Annual % Increase for Fees and Charges
Sewer Fund
Capital Improvement Plan
Sewer Fund Estimate
Project Description 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
Capital Outlay
Transportation Plan 65,000 1,020,000 700,000 1,760,000 936,000 934,000 1,694,000 887,000 - 1,631,000
Sewer Lining - Inflow/Infiltration Prevention 454,500 468,000 482,000 496,000 511,000 526,000 542,000 558,000 575,000 592,000
Lift Station Rehabilitation 709,000 720,000 750,000 775,000 800,000 825,000 850,000 875,000 900,000 925,000
Technology Plan - SCADA 500,000 500,000 500,000 500,000 500,000 10,000 10,500 11,025 11,576 12,155
Generator/Equipment 175,000 - - 225,000 250,000 780,000 85,000 - 60,000 -
New Maintenance Center - Sewer portion of c - - - - - - - 3,000,000 - -
Total Capital Outlay 1,903,500 2,708,000 2,432,000 3,756,000 2,997,000 3,075,000 3,181,500 5,331,025 1,546,576 3,160,155
Source of Funds
Bond Proceeds - - - 5,150,000 - - 6,815,000 - 6,178,730 -
Current revenue / use of cash in fund 1,903,500 2,708,000 2,432,000 (1,394,000) 2,997,000 3,075,000 (3,633,500) 5,331,025 (4,632,154) 3,160,155
Total Source of Funds 1,903,500 2,708,000 2,432,000 3,756,000 2,997,000 3,075,000 3,181,500 5,331,025 1,546,576 3,160,155
Stormwater Fund
Summary of Key Financial Information
Stormwater Fund 2025
(estimate)2026 2027 2028 2029 2030 2031 2032 2033 2034
Cash by Purpose
For future capital improvements 2,653,718 2,955,752 3,063,468 2,999,256 3,186,502 2,911,580 3,066,533 4,576,565 4,934,402 4,639,573
For following year pay-go capital 1,095,000 910,000 1,079,000 1,134,000 1,151,000 1,638,000 1,285,000 - 1,834,000 1,894,000
For 3-months of operating cash 268,094 238,345 244,996 287,155 258,891 267,398 273,619 281,311 299,798 297,385
For following year debt service 89,650 87,650 90,650 88,400 91,150 88,650 91,150 88,400 232,817 200,308
Ending Cash 4,106,461 4,191,746 4,478,114 4,508,811 4,687,543 4,905,628 4,716,302 4,946,276 7,301,017 7,031,266
Per Residential Equivalent Unit 30.0%3.0%3.0%3.0%3.0%3.0%3.0%3.0%3.0%3.0%
Average Annual % Increase for Fees and Charges
Stormwater Fund
Capital Improvement Plan
Stormwater Fund Estimate
Project Description 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
Capital Outlay
Transportation Plan 630,000 693,000 360,000 511,000 668,000 667,000 996,000 634,000 - 1,165,000
Pond Maintenance & Retrofit 212,000 218,000 225,000 232,000 239,000 246,000 253,000 261,000 269,000 277,000
Stormwater Improvements 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000 150,000
Stormwater Pond Planning 33,000 34,000 35,000 36,000 37,000 38,000 39,000 40,000 41,000 42,000
Prior Lake Outlet Channel (PLOC) Lining Project 15,000 - - - - - - - - -
LSWMP Implementation Plan - - - 50,000 - 50,000 200,000 200,000 200,000 200,000
Misc projects 150,000 - 140,000 100,000 40,000 - - - - -
Total Capital Outlay 1,190,000 1,095,000 910,000 1,079,000 1,134,000 1,151,000 1,638,000 1,285,000 660,000 1,834,000
Source of Funds
Bond Proceeds - - - - - - - - 1,461,270 -
Current revenue / use of cash in fund 1,190,000 1,095,000 910,000 1,079,000 1,134,000 1,151,000 1,638,000 1,285,000 (801,270) 1,834,000
Total Source of Funds 1,190,000 1,095,000 910,000 1,079,000 1,134,000 1,151,000 1,638,000 1,285,000 660,000 1,834,000
Debt Analysis and Tax Impact
In reviewing the 2026-2030 Capital Improvement Program, the City Council should consider the
level of debt as well as the annual tax impact of the scheduled projects.
The 2026-2030 CIP includes projects that are planned to be funded by bond proceeds/debt.
Bonds are issued for the project costs that the City is funding through tax levies as well as the
costs that are specially assessed to property owners.
As of 12/31/2024, the City of Prior Lake had $26.5M in debt. The following chart reflects the
type of debt. One-third of the debt is for facilities: Water Treatment Plant (through 2030), Fire
Station #2, City Hall, and the Police Station (through 2031).
The 2026-2030 CIP anticipates the following bonding (debt issuance) needs:
• The City is considering the future issuance of debt for park and recreation improvements
of $60 million of bonds from the years 2026 to 2030 for park and trail improvements, to be
financed as part of the City’s debt levy. The City Council has authorized staff to move
forward to seek tax base approval through a voter referendum in November 2025.
Therefore, the tax levy and tax rate implications of potential park improvement bonds are
reflected in the City’s CIP and financial plan for City Council consideration.
• The 2026-2031 Park Plan includes bonding of $60,000,000 for Park Improvements,
primarily for community parks. The plan reflects bonding for major community park
improvements planned for Spring Lake and Lakefront community parks, and
neighborhood park improvements. Estimated funding needs in the five-year plan have
Debt Type Amount as of
December 31, 2024 Purpose
G.O. Special Assessments 8,970,000 Street Improvement Projects
G.O. TIF Bonds 0 Tax Increment Project
G.O. Bonds (MV)1,785,000 Referendum Project (Fire Station #2)
G.O. Bonds 3,540,000 Street Reconstruction Projects
G.O. Bonds 1,860,000 Public Works Building and CIP
Projects
G.O. Bonds 670,000 E quipment
G.O. Revenue Bonds 6,360,000
Maintenance Facility, Water
Treatment Facility & Utility
Replacement Projects
G.O. Capital Improvement
Bonds 3,155,000 City Hall & Police Station
Energy Lease Loan Payable
(GESP)148,731 Guaranteed Energy Savings Program
Projects
Total 26,488,731
been identified as $5M in 2026, $15M in 2027, $5M in 2028, $15M in 2029, $5M in 2030,
and $15M in 2031 (year six of the CIP Park Plan). The funding needs by year may change
as community discussion of the proposed projects continues in 2025 and the scope and
timing of specific projects is determined. The five-year financial impact of the potential
park improvement bonding is shown in red on the debt analysis below.
• The Equipment Replacement Plan includes $4,810,000 of bonding for major equipment
replacement expenditures primarily for fire truck replacements (ladder truck in 2027 and
pumper truck in 2030).
• Bonding of $3,165,000 for major park replacement expenditures includes the replacement
for the four Ponds Park parking lots and entrance road in 2028.
• The Facilities Plan includes $6,800,000 of bonding for major facility repairs for City Hall
and Police Station replacement of membrane roofing and heating, ventilation, and air
conditioning (HVAC) updates, and parking/safety enhancements.
• The Pavement Management Plan includes bonding of $23,010,000 for transportation plan
projects and street mill & overlay projects. The repayment sources for this bonding include:
o Tax levy
o Project Special Assessment (The City provides the upfront funding for the special
assessment portion via bonding)
• The Sewer Fund includes bonding of $5,150,000 for planned expenditures for sewer
replacement costs on street reconstruction projects as well as lift station rehab, sewer
lining, and SCADA software update.
The table below summarizes the proposed bonding by fund and year:
Summary of Projected Debt Balances
The following tables reflect all bonding requirements referenced in the CIP, Pavement
Management Plan, Facilities Management Plan, and Equipment Replacement Plan. It includes
Fund Name
2025 2026 2027 2028 2029 2030
Capital Park Fund F226 (Park Improvement Bonds)- 5,000,000 15,000,000 5,000,000 15,000,000 5,000,000
Revolving Equip Fund F410 - 3,060,000 - - 1,750,000
Revolving Park Equip Fund F430 - - - 3,165,000 - -
Facilities Mgmt Fund F440 - 2,060,000 - 2,575,000 2,165,000
PIR Revolving Fund F450 - 500,000 230,000 415,000 -
Construction Fund F501 2,157,000 5,870,000 3,575,000 3,870,000 4,185,000 4,365,000
-
Governmental Funds Subtotal 2,157,000 12,930,000 22,135,000 14,840,000 21,765,000 11,115,000
Water Fund - - - - - -
Stormwater Fund - - - - - -
Sanitary Sewer Fund - - - 5,150,000 - -
Utility Funds Subtotal - - - 5,150,000 - -
City total Debt Issuance - All funds 2,157,000 12,930,000 22,135,000 19,990,000 21,765,000 11,115,000
Long-Term Financial Planning
Bond Proceeds for Capital Projects
Projected Bonding by Year
the proposed bonding that will be presented to residents by referendum for community park
improvements (identified in the Park Plan).
Based on the proposed projects in the CIP, debt is projected to increase from $26.5M at the end
of 2024 to $85.6M at the end of 2030. Approximately $43M of the projected 2030 debt is for
proposed community and neighborhood park improvements.
Projected Debt per Capita:
Projected debt per capita based on the current capital projects planned is shown in the table
below. It is shown with and without the proposed Parks Improvements bonding. The City is
working to manage its debt load while providing needed capital replacement projects in a growing
city.
Bond Repayment through Debt Service Tax Levy:
The impact of the 2026-2030 CIP and other anticipated bond payment adjustments on the debt
service property tax levy are reflected in the following tables.
Projected five-year annual change in debt levy:
The table below indicates that we are planning to increase our annual debt levy in the five-year
planning period to fund planned community and neighborhood park improvements of $5M in 2026,
$15M in 2027, $5M in 2028, $15M in 2029 and $5M in 2030. (Additional $15M also planned for
2031, year six of the 10-year CIP.) Staff will work with our municipal advisor to review options for
structuring the debt to minimize the annual debt service impact.
2025 2026 2027 2028 2029 2030
Total Debt Outstanding (Existing & Planned)
Governmental Funds Debt Outstanding 19,750,000 28,925,000 46,880,000 57,105,000 73,715,000 80,120,000
Enterprise Funds Debt Outstanding 4,395,000 3,585,000 2,735,000 6,995,000 6,245,000 5,460,000
Total Debt Outstanding (Existing & Planned)24,145,000 32,510,000 49,615,000 64,100,000 79,960,000 85,580,000
Park Improvement Debt Only - 5,000,000 19,890,000 24,450,000 38,880,000 42,960,000
Long-Term Financial Planning
Projected Change in Debt Outstanding
2025 2026 2027 2028 2029 2030
Debt Per Capita (assumes popluation growth)
Debt Per Capita (not incl Park Improvement Bonds)853 967 1,039 1,380 1,420 1,463
Debt Per Capita (incl Park Improvement Bonds)853 1,143 1,734 2,231 2,763 2,937
Long-Term Financial Planning
Projected
Projected change in total CIP Tax Levy:
The table below shows the projected change in the CIP tax levy by component.
These projected debt service levy estimates for the years 2025-2030 are based on level annual
debt service payments.
The table below is a summary of the annual projected total CIP tax levy by component.
Bond Repayment Debt Service supported by Water and Sewer Fund Revenues:
• Revenues of the Water and Sewer Funds support the annual debt service for the Water
Treatment Plant debt refunding bond issues, the AMRS replacement, and the Huron area
street improvements.
• Revenues of the Stormwater fund will support the proposed annual debt service for the
2024 proposed debt issuance of $1,240,000 for storm sewer replacement costs on street
reconstruction project as well as the regional water quality pond project.
• The projected annual debt service for the utility funds is shown below:
2025 2026 2027 2028 2029 2030
Change in Debt Levy
Debt Service Levy (not incl Park Improvement Bonds)(244,692) 105,266 625,046 397,324 175,689 (126,335)
Debt Levy (Park Improvement Bonds Only)- - 470,838 1,295,929 136,717 1,294,469
Change in Debt Levy (244,692) 105,266 1,095,884 1,693,253 312,406 1,168,135
Projected Change in Debt Levy
2025 2026 2027 2028 2029 2030
Debt Service Levy (not incl Park Improvement Bonds)(244,692) 105,266 625,046 397,324 175,689 (126,335)
Debt Levy (Park Improvement Bonds Only)- - 470,838 1,295,929 136,717 1,294,469
Equipment Revolving Fund 50,000 (100,000) 50,000 100,000 70,000 50,000
Revolving Park Equip Fund 20,000 60,000 60,000 50,000 50,000 50,000
Facilities Management Fund 50,000 50,000 50,000 50,000 50,000 50,000
PIR Fund - - - - - -
Change in Total CIP Tax Levies (124,692) 115,266 1,255,884 1,893,253 482,406 1,318,135
Projected Change in CIP Tax Levy2025-2030 CIP
2025 2026 2027 2028 2029 2030
Debt Service Levy (not incl Park Improvement
Bonds)3,191,678 3,296,944 3,921,990 4,319,314 4,495,003 4,368,668
Debt Levy (Park Improvement Bonds Only)- - 470,838 1,766,767 1,903,484 3,197,953
Equipment Revolving Fund 1,025,000 925,000 975,000 1,075,000 1,145,000 1,195,000
Revolving Park Equip Fund 535,000 595,000 655,000 705,000 755,000 805,000
Facilities Management Fund 255,000 305,000 355,000 405,000 455,000 505,000
PIR Fund - - - - - -
Total CIP Tax Levies 5,006,678 5,121,944 6,377,828 8,271,081 8,753,487 10,071,621
CIP Tax Levies:Projected CIP Tax Levy
CIP Impact on Long Range Financial Plan:
The financial plan incorporates the debt and tax levy impacts of the Capital Improvement
Program. Approval of the CIP does not obligate the City to complete the proposed projects or
purchases. The 2025 projects/proposed purchases will be incorporated into the 2025 budget
requests for budgeted funds. Further Council approvals may be necessary to comply with state
statutes and the city’s purchasing policy.
The City’s financial planning reflects funding general operations, future planned capital
improvements, including related debt service on planned bond issuance to support capital
improvements for streets, equipment replacement and facilities capital maintenance projects.
Debt repayment is based on level annual debt service payments.
As part of the City’s financial planning, the City is planning for a park referendum Fall 2025 for
$60M in park improvements. If approved by the voters, approximate bonding needs/projects
would be spread over six years (2026-2031) for community parks and neighborhood
improvements. This would provide funding for park improvements at Spring Lake Park, Lakefront
Park and neighborhood parks and trails.
Funding for proposed projects in the CIP results in an estimated 10-year average tax levy increase
of 7.8% and an estimated 10-year average tax rate increase of 4.1%. This is in line with the
parameters established in the city’s 2023 long range financial planning study.
The estimated tax levies and tax rate projections for the City’s five-year financial plan are shown
below.
2025 2026 2027 2028 2029 2030
Water 789,000 791,950 801,700 810,450 645,350 652,650
Sewer 164,250 162,500 165,500 168,000 497,325 394,550
Stormwater 86,830 89,650 87,650 90,650 88,400 91,150
2026-2030 CIP Projected Debt Service (funded by Utility Fund Revenues)
CITY PROPERTY TAX PROJECTION - INCLUDING PARK IMPROVEMENT BONDS
2025 2026 2027 2028 2029 2030
TAX LEVIES
General Fund Levy - Tax Capacity 14,848,732 16,238,411 17,660,526 19,264,383 20,425,810 21,695,077
General Fund Levy - Market Value 262,488 265,888 273,988 281,638 283,838 290,738
Debt Service Fund (not incl Park Improvement Bonds)2,929,190 3,031,056 3,648,002 4,037,676 4,211,165 4,077,930
Debt Levy (Park Improvement Bonds Only)470,838 1,766,767 1,903,484 3,197,954
CIP Funds 1,815,000 1,825,000 1,985,000 2,185,000 2,355,000 2,505,000
Total Tax Levies 19,855,410 21,360,355 24,038,354 27,535,464 29,179,297 31,766,698
Annual $ Change 1,859,077 1,504,945 2,677,998 3,497,111 1,643,832 2,587,401
TOTAL % CHANGE IN TAX LEVIES - including Park Imp Bonds 6.2%7.6%12.5%14.5%6.0%8.9%
CITY TAX CAPACITY TAX RATE- No Park Improvement Bonds 31.36%33.98%36.32%37.17%37.62%
Annual % Change 2.82%8.35%6.87%2.34%1.21%
CITY TAX CAPACITY TAX RATE- Including Park Improvement Bonds 31.36%34.71%38.97%39.92%42.07%
Annual % Change 2.82%10.67%12.27%2.44%5.40%
Debt per Capita - No Park Improvement Bonds 853 967 1,039 1,380 1,420 1,463
Debt per Capita - Including Park Improvement Bonds 853 1,143 1,734 2,231 2,763 2,937
Bonds Outstanding - No Park Improvement Bonds 24,145,000 27,510,000 29,725,000 39,650,000 41,080,000 42,620,000
Change in Bonds Outstanding 3,365,000 2,215,000 9,925,000 1,430,000 1,540,000
Bonds Outstanding - Including Park Improvement Bonds 24,145,000 32,510,000 49,615,000 64,100,000 79,960,000 85,580,000
Change in Bonds Outstanding 8,365,000 17,105,000 14,485,000 15,860,000 5,620,000
Five Year Planning Period
PriorLakeMN.gov
2026-2030 CAPITAL
IMPROVEMENT PROGRAM
Nick Monserud
Nicole Klekner
Liam Duggan
Lori Olson
Rick Steinhaus
PriorLakeMN.gov
2026-2030 CIP Schedule
•June 24: Part I: Capital Plans Review
•July 22: Part II: Financial Plan with CIP Impacts (tax
levy & debt service)
•August 12: Public Hearing and Adopt 2026-2030
CIP
2
PriorLakeMN.gov
2025-2029 CIP Schedule
1)Utility Funds – Separate discussion at 7/22 work session
•Water Financial Plan
•Sanitary Sewer Financial Plan
•Water Quality Financial Plan
3
PriorLakeMN.gov
Utility Funds Financial Management
Plan
4
The 5-year total Water/Sewer/Stormwater
funding needs to support the pavement
management plan street reconstruction
projects:
$6.4M, $5.4M and $2.9M for water, sewer,
and stormwater respectively.
Funding for utility funds is achieved through
rates charged and/or debt issuance. The
financial model reflects debt issuance in the
five-year plan as follows:
Water fund – no debt issuance
Sewer fund:
•2028 -$5,150,000
•2031 -$6,815,000
•2033 -$6,178,730
Stormwater fund:
•2033 -$1,461,270
Proposed rate changes for 2026 are as
follows:
Water – 3.0%
Sewer –7.5%
Stormwater –3.0%
PriorLakeMN.gov
Utility Bill Combined Impact – All Funds
5
Sample Bi-Monthly Utility Bill:
Total per Year 2025 2026 2027 2028 2029 2030
High User 6,258$ 6,562$ 6,787$ 7,020$ 7,274$ 7,538$
Medium User 1,355$ 1,423$ 1,471$ 1,521$ 1,570$ 1,620$
Low User 887$ 933$ 964$ 996$ 1,025$ 1,056$
Annual Increase
High User 304$ 225$ 233$ 254$ 264$
Medium User 67$ 48$ 50$ 49$ 50$
Low User 46$ 31$ 32$ 29$ 30$
Annual Percentage Increase
High User 4.9%3.4%3.4%3.6%3.6%
Medium User 5.0%3.4%3.4%3.2%3.2%
Low User 5.1%3.3%3.3%2.9%2.9%
Average 5.0%3.4%3.4%3.3%3.3%
PriorLakeMN.gov
Debt Projection
6
Based on the proposed projects in
the CIP, debt is projected to increase
from $26.5M at the end of 2024 to
$85.6M at the end of 2030.
Approximately $60M of the
projected debt is for proposed
community and neighborhood park
improvements.
$45M is reflected in the five-year plan
(2026-2030) and an additional $15M is
planned for 2031 for a total of $60M.
2025 2026 2027 2028 2029 2030 2031
Total Debt Outstanding (Existing & Planned)
Governmental Funds Debt Outstanding 19,750,000 28,925,000 46,880,000 57,105,000 73,715,000 80,120,000 97,920,000
Enterprise Funds Debt Outstanding 4,395,000 3,585,000 2,735,000 6,995,000 6,245,000 5,460,000 11,460,000
Total Debt Outstanding (Existing & Planned)24,145,000 32,510,000 49,615,000 64,100,000 79,960,000 85,580,000 109,380,000
Park Improvement Debt Only - 5,000,000 19,890,000 24,450,000 38,880,000 42,960,000 56,885,000
Long-Term Financial Planning
Projected Change in Debt Outstanding
PriorLakeMN.gov
City Property Tax Projection
Including Park Improvement Bonds
7
Information in red
includes impact of
Park Improvement
Bonds
PriorLakeMN.gov
Debt Per Capita Projection
8
Bar Chart: G.O. Debt
Per Capita as of Year-
End 2022 Continuing
Disclosure Reporting
2025 2026 2027 2028 2029 2030
Debt Per Capita (assumes popluation growth)
Debt Per Capita (not incl Park Improvement Bonds)853 967 1,039 1,380 1,420 1,463
Debt Per Capita (incl Park Improvement Bonds)853 1,143 1,734 2,231 2,763 2,937
Projected
PriorLakeMN.gov
Park Referendum Debt Service Impact
Median Value Home
9
Estimated Annual Tax Impact of Park Referendum
Improvements for a Median Value Home of $433,600 $265/Year
$22/month
Questions/Discussion
City of Prior Lake Council Meeting 7.22.2025
2026 Budget Attachment 1
Budgeted Funds BSA: Department Requested Bduget
Debt Capital Revolving Revolving Park Permanent Facilities Total Total
General Service Cable Park Equipment Equipment Improvement Management EDA Governmental Water Sewer Water Quality Enterprise Budgeted
Fund Funds Fund Fund Fund Fund Revolving Fund Fund Funds Fund Fund Fund Funds Funds
Revenues / Sources
Property Taxes
Levy - Tax Capacity 16,238,411$ -$ -$ -$ 925,000$ 595,000$ -$ 305,000$ 405,000$ 18,468,411$ -$ -$ -$ -$ 18,468,411
Levy - Tax Capacity for Debt Service 3,031,057$ 3,031,057 3,031,057
Levy - Market Value 265,888 - - - - - - 265,888 - - - - 265,888
MVHC Aid - - - - - - - - - - - - -
Special Assessments 4,000 460,815 - - - 178,246 - - 643,061 - - - - 643,061
Licenses & Permits 472,710 - - - - - - 472,710 - - - - 472,710
Fines & Forfeits 108,000 - - - - - - 108,000 - - - - 108,000
Intergovernmental 3,908,388 - - - - 212,500 - - 4,120,888 - - - - 4,120,888
Charges for Services 1,313,290 - 12,000 212,700 - - - 26,988 1,564,978 5,659,319 6,007,314 2,127,213 13,793,846 15,358,824
Other Revenues 948,800 89,800 - 41,400 14,000 198,200 26,100 28,700 11,100 1,358,100 237,900 119,500 100,100 457,500 1,815,600
Bond Proceeds - - - - - 1,500,000 - 1,500,000 - . - 1,500,000
Lease Proceeds - - - - - - - - - - - - - - -
Transfers From Other Funds - -
General Fund - 265,888 - - - - - - - 265,888 - - - - 265,888
Debt Service Funds - 38,568 - - - - - - - 38,568 - - - - 38,568
Water Fund 270,000 629,450 - - - - - 30,000 - 929,450 - - - - 929,450
Sewer Fund 268,000 - - - - - - 30,000 - 298,000 - - - - 298,000
Water Quality Fund 130,000 - - - - - - - - 130,000 - - - - 130,000
Trunk Reserve Fund - - - - - - - - - - - - - - -
TIF Fund - - - - - - - - - - - - - - -
PIR Fund - 371,250 - - - - - - - 371,250 - - - - 371,250
Facilities Management Fund - - - - - - - - - - - - - - -
Capital Park Fund - - - - - - - - - - - - - - -
Construction Fund - - - - - - -
Police Forfeiture Fund - - - - - -
Public Safety Special Revenue Fund - - - - - - - - - -$ -$ -$ -
Total Revenues / Sources 23,927,487$ 4,886,828$ 12,000$ 254,100$ 939,000$ 1,005,700$ 204,346$ 1,893,700$ 443,088$ 33,566,249$ 5,897,219$ 6,126,814$ 2,227,313$ 14,251,346$ 47,817,595$
Expenditures / Uses
Employee Services 17,305,086$ -$ -$ -$ -$ -$ -$ -$ 176,359$ 17,481,445$ 1,418,916$ 838,027$ 445,483$ 2,702,426$ 20,183,871$
Current Expenditures 6,158,513 - 3,700 5,600 - - - - 88,750 6,256,563 2,409,666 2,817,496 387,895 5,615,057 11,871,620
Capital Outlay 198,000 - - - - - - - 385,000 583,000 390,000 500,000 402,000 1,292,000 1,875,000
Capital Improvements - - - - 1,662,600 870,000 - 1,293,000 - 3,825,600 2,100,000 1,188,000 - 3,288,000 7,113,600
Subtotal 23,661,599$ -$ 3,700$ 5,600$ 1,662,600$ 870,000$ -$ 1,293,000$ 650,109$ 28,146,608$ 6,318,582$ 5,343,523$ 1,235,378$ 12,897,483$ 41,044,091$
Transfers To Other Funds
General Fund -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ 270,000$ 268,000$ 130,000$ 668,000$ 668,000$
Construction Fund - - - - - - - - - - 1,150,000 1,020,000 693,000 2,863,000 2,863,000
Equipment Fund - - - - - - - - - - - - - - -
Park Equipment Fund - - - - - - - - - - - - - - -
Debt Service Funds 265,888 38,568 - - - - 371,250 - - 675,706 629,450 - - 629,450 1,305,156
PIR Fund - - - - - - - - - - - - - - -
Facilities Management Fund - - - - - - - - - - 30,000 30,000 - 60,000 60,000
EDA Fund - - - - - - - - - - - - - - -
Severance Compensation Fund - - - - - - - - - - - - - - -
Contingency - - - - - - - - - - - - - - -
Debt Service - 5,125,788 - - - - - - - 5,125,788 162,500 162,500 89,650 414,650 5,540,438
Subtotal 265,888$ 5,164,356$ -$ -$ -$ -$ 371,250$ -$ -$ 5,801,494$ 2,241,950$ 1,480,500$ 912,650$ 4,635,100$ 10,436,594$
Total Expenditures / Uses 23,927,487$ 5,164,356$ 3,700$ 5,600$ 1,662,600$ 870,000$ 371,250$ 1,293,000$ 650,109$ 33,948,102$ 8,560,532$ 6,824,023$ 2,148,028$ 17,532,583$ 51,480,685$
Change in Fund Balance -$ (277,528)$ 8,300$ 248,500$ (723,600)$ 135,700$ (166,904)$ 600,700$ (207,021)$ (381,853)$ (2,663,313)$ (697,209)$ 79,285$ (3,281,237)$ (3,663,090)$
2026 City Property Tax Levy Comparison Council Meeting 7.22.2025
Attachment 1
Change 25 - 26
Property Taxes 2025 2026 Amount Percent
Levy - Tax Capacity
General Fund - Operating 14,848,732$ 16,238,411$ 1,389,679$ 9.4%
Debt Service Funds 2,929,190 3,031,057 101,867 3.5%
Revolving Equipment Fund 1,025,000 925,000 (100,000) -9.8%
Revolving Park Equipment Fund 535,000 595,000 60,000 11.2%
Permanent Improvement Revolving Fund - - - n/a
Facilities Management Fund 255,000 305,000 50,000 19.6%
19,592,922 21,094,468 1,501,546 7.7%
Levy - Market Value - General Fund 262,488 265,888 3,400 1.3%
Total City Levy 19,855,410$ 21,360,356$ 1,504,946$ 7.6%
2026 EDA Property Tax Levy Comparison
Change 24 - 25
Property Taxes 2025 2026 Amount Percent
Total Economic Dev Authority Levy 405,000 405,000 - 0.0%
2026 Budget Expenditure Comparisons (2025 Original Budgets)
Capital Revolving Revolving Park Permanent Facilities Total Total
General Debt Service Cable Park Equipment Equipment Improvement Management EDA Governmental Water Sewer Water Quality Enterprise Budgeted
Fund Funds Fund Fund Fund Fund Revolving Fund Fund Funds Fund Fund Fund Funds Funds
2026 Total Expenditures / Uses 23,927,487$ 5,164,356$ 3,700$ 5,600$ 1,662,600$ 870,000$ 371,250$ 1,293,000$ 650,109$ 33,948,102$ 8,560,532$ 6,824,023$ 2,148,028$ 17,532,583$ 51,480,685$
2025 Total Expenditures / Uses 22,168,668$ 5,185,248$ 3,700$ 2,505,600$ 1,074,200$ 2,060,000$ 369,736$ 787,175$ 724,838$ 34,879,165$ 5,847,906$ 5,179,585$ 2,334,004$ 13,361,495$ 48,240,660$
Change 2025 to 2026 ($) 1,758,819$ (20,892)$ -$ (2,500,000)$ 588,400$ (1,190,000)$ 1,514$ 505,825$ (74,729)$ (931,063)$ 2,712,626$ 1,644,438$ (185,976)$ 4,171,088$ 3,240,025$
Change 2025 to 2026 (%) 7.93% -0.40% 0.00% -99.78% 54.78% -57.77% 0.41% 64.26% -10.31% -2.67% 46.39% 31.75% -7.97% 31.22% 6.72%
2026 Budget Expenditure Comparisons (2025 Amended Budgets)
Capital Revolving Revolving Park Permanent Facilities Total Total
General Debt Service Cable Park Equipment Equipment Improvement Management EDA Governmental Water Sewer Water Quality Enterprise Budgeted
Fund Funds Fund Fund Fund Fund Revolving Fund Fund Funds Fund Fund Fund Funds Funds
2026 Total Expenditures / Uses 23,927,487$ 5,164,356$ 3,700$ 5,600$ 1,662,600$ 870,000$ 371,250$ 1,293,000$ 650,109$ 33,948,102$ 8,560,532$ 6,824,023$ 2,148,028$ 17,532,583$ 51,480,685$
2025 Total Expenditures / Uses 22,734,456$ 5,185,248$ 3,700$ 2,505,600$ 1,074,200$ 2,075,000$ 434,563$ 1,183,175$ 724,838$ 35,920,780$ 5,438,406$ 5,698,585$ 2,349,004$ 13,485,995$ 49,406,775$
Change 2025 to 2026 ($) 1,193,031$ (20,892)$ -$ (2,500,000)$ 588,400$ (1,205,000)$ (63,313)$ 109,825$ (74,729)$ (1,972,678)$ 3,122,126$ 1,125,438$ (200,976)$ 4,046,588$ 2,073,910$
Change 2025 to 2026 (%) 5.25% -0.40% 0.00% -99.78% 54.78% -58.07% -14.57% 9.28% -10.31% -5.49% 57.41% 19.75% -8.56% 30.01% 4.20%
PERSONNEL PLAN
2026-2030
2026 – 2030 Personnel Plan / Page 2
INTRODUCTION
Similar to how the City plans its infrastructure and equipment needs through the Capital Improvement Plan (CIP), this Personnel Plan is designed
to address the staffing needs required to support the anticipated demand for City services as Prior Lake grows. The general fund budget is
dominated by personnel costs (71.6% of the total budget in 2025) which explains why planning for personnel is critical for long-range planning.
This Plan projects the anticipated staffing requirements for the City of Prior Lake by 2030. It will be revisited annually to adapt to the evolving
needs and expectations of the community.
The objectives of the plan include:
• Informing annual and long-range budget discussions and decisions;
• Forecasting future demands for service; and
• Identifying the resources required to perform current service levels in the future.
This five-year document will be incorporated into the City’s long-range financial plan and will be updated each year to inform the annual budget
process. Departments will be responsible for providing the metrics to justify the personnel requests and impact on current service levels during
annual budget deliberations. This document focuses only on the need and rationale for each position request. The discussion on how the City will
fund these positions will be held through the annual budgeting process in consideration with other budget requests like the CIP. The City Council
will determine the addition and timing of bringing on any new staff.
BACKGROUND
City staff provide essential services to 28,915 residents (2023 Met Council population estimate) over nineteen square miles, not including the
recent annexation agreement with Spring Lake Township. In addition, the residents of Spring Lake Township, the City of Credit River, and the
Shakopee Mdewakanton Sioux Community (SMSC) receive public safety services from the City. Prior Lake has grown at a steady pace of about
five hundred residents annually in one of the fastest growing counties in Minnesota. The Metropolitan Council forecasts Prior Lake’s population
will grow to 37,600 residents by 2040.
Cities do not grow solely in terms of population or households as the services -- infrastructure, parks, public safety, and technology, to name a few
– that are required to accommodate such growth must expand as well. These services are supported by municipal employees togethe r with the
equipment, supplies and training necessary to execute their functions
The City of Prior Lake currently operates with 121 employees. The majority (75%) of employees work in Public Works, Police Department, and Fire
Department, most of whom are considered essential employees. The City hires around fifty seasonal and temporary positions each year and
employs 26 paid on-call shift firefighters/EMTs.
2026 – 2030 Personnel Plan / Page 3
PERSONNEL NEEDS THROUGH 2030
Below is an overview of the projected staffing needs to maintain current service levels through 2030. Community Development, Finance, and
Public Works have added or repurposed positions in the past few years and should be adequately staffed through 2030. Administration and the
Fire Department have identified positions to round out those departments’ staffing needs. In 2024, the Police Department completed a workload
study with an external consultant, and the results were presented to the City Council in February 2025. The findings of that study are incorporated
into this Plan. On the following pages, each department is profiled with a summary of all current and proposed positions within the department
and a rationale for each new FTE request.
*One added position in the Police Department is budget neutral due to schedule and overtime savings.
Department 2026 2027 2028 2029 2030
Administration (8)
1 1
- - .62
Community Development (10.8)
- - - - -
Finance (6.8)
- - - - -
Fire (15)
- - 3 - -
Police (39.42) 3* 2 - 1 1
Public Works (41) - - - - -
Total New: 4 3 3 1 1.62
Total City Headcount (121.02) 125.02 128.02 131.02 132.02 133.64
2026 – 2030 Personnel Plan / Page 4
DEPARTMENT
PROFILES
2026 – 2030 Personnel Plan / Page 5
ADMINISTRATION
*2026: Network Administrator (1 FTE). The city needs a full-time network administrator to assist in the management and oversight of the city’s
IT infrastructure, networks, server operations, security systems, and software. There is simply too much work for two employees to manage in a
city our size (comparable cities average IT 3.5 FTEs). Prior Lake’s IT division supports over 1,300 devices for 121 employees and 16 servers in
seven buildings. A major reason for the need for IT help is the Police Department. One full-time employee could support PD alone with the
evolving technology related to law enforcement (body cams, dash cams, squad tough books, video rooms, building security, LETG, etc.) and,
more importantly, unfunded CJIS (criminal justice information services) security mandates from the MN Bureau of Criminal Apprehension (BCA).
The current IT Specialist’s primary responsibility is responding to the city’s help desk (1,100 help desk tickets in 2024), the City’s phone system,
Microsoft outlook security training, and printer/copiers. That leaves one person, the IT Manager, to perform all the other technical support
functions related to systems maintenance of the local area networks (LANs), administration of personal computer workstations and peripherals,
security administration, technical support to users, troubleshooting of hardware and software problems, and installation of hardware equipment
and software applications (Laserfiche, BS&A), onboarding/terminating employees, building access and cameras etc. A cyber security risk
assessment conducted in 2024 rated the city poor in most policy categories and several process improvements, such as online licensing and
payment, have not moved forward because the IT Manager gets pulled away with break and fix items. The Network Administrator could assume
many of the higher-level technical aspects of the city’s IT needs so the IT Manager can focus on developing a cyber security program and policies,
budgeting, long-range planning, researching products and devices while also providing technical support.
*2027: Administrative Assistant (1 FTE). This will be a hybrid position that will support the Fire Department, City Manager, and staff the front
desk of City Hall. By 2026, the full-time Fire Department will have been functioning for three full years, including implementing a fire inspection
and fire pre-plan program for all commercial buildings along with strengthening its fire prevention and public education programs.
Administrative support will be required to assist with scheduling inspections, building walkthroughs, follow-up paperwork, and to organize public
education events. The position will also assist with the administration of Fire/EMS reporting, inspections, and Fire’s permitting software
platform. As for City Hall, we anticipate transitioning the Deputy City Clerk away from reception area duties into full-time clerk duties because of
increased election administration mandates and records management needs. The Administrative Assistant will greet customers, answer phones,
check mail, and conduct front desk tasks so the Deputy City Clerk can focus full-time on clerk duties. The City Manager also requires
administrative support for scheduling, correspondence, and other executive assistance. These duties used to fall to the combination HR
support/executive assistant position which transitioned to full-time HR duties in 2022. Finally, the proposed Administrative Assistant will receive
training on some utility billing tasks to serve as backup and additional support when necessary.
2026 – 2030 Personnel Plan / Page 6
*2030: Communications Specialist/Graphic Designer (.62 FTE). Communicating with the public is a core city service, and as a local government,
we are obligated to provide timely, relevant information to our citizens to ensure transparency and accountability. With only one full-time
communications employee, taking advantage of the multiple mediums (e.g., videos, social media content, press releases, news items, website
updates, etc.) to reach a broad spectrum of residents is a challenge. Additional support is needed to help manage the City’s website and to
create graphics for all communication mediums and City departments. Peer cities average 2.5 communications FTEs.
Total FTEs in 2025 – 8
Administration 2026 2027 2028 2029 2030
City Manager 1 1 1 1 1
Assistant City Manager 1 1 1 1 1
City Clerk 1 1 1 1 1
Deputy City Clerk 1 1 1 1 1
HR Coordinator 1 1 1 1 1
Communications Manager 1 1 1 1 1
Communications Specialist - - - - .62*
IT Manager 1 1 1 1 1
Network Administrator 1* 1 1 1 1
IT Specialist 1 1 1 1 1
Admin Assistant - 1* 1 1 1
TOTAL: 9 10 10 10 10.62
2026 – 2030 Personnel Plan / Page 7
COMMUNITY DEVELOPMENT
The department is anticipating the retirement of two key staff members in the near future which will require replacement; however, no new
personnel additions are anticipated through 2030. The last position added in Community Development was a full-time Building Inspector in
2021. The new Building Inspector position was necessary due to the increased demand for inspections, plan review, and permit issuance and the
first two years’ salary was partially funded by a Department of Labor and Industry grant. In addition to plan review and assisting customers at
the counter, the city issues over 2,800 building permits and conducts 6,000+ building inspections per year; it is common during the busier times
of year for each inspector to have over twenty inspections on their daily calendar. Code enforcement opens and closes over 500 cases per year
and generally completes over 1,500 inspections. Current staffing levels should meet the demand for services for the foreseeable future.
Total FTEs in 2025 – 10.8
Community Development 2026 2027 2028 2029 2030
Comm Development Director 1 1 1 1 1
Building Official 1 1 1 1 1
Building Inspector 3 3 3 3 3
Code Enforcement Officer 1 1 1 1 1
Planner 2 2 2 2 2
Development Services Assistant 2.8 2.8 2.8 2.8 2.8
TOTAL: 10.8 10.8 10.8 10.8 10.8
2026 – 2030 Personnel Plan / Page 8
FINANCE
In 2025, The Assistant Finance Director moved into a full-time position from a .8 FTE, and the Financial Analyst transitioned to a part-time position.
The Finance Department continues to provide alternative work arrangements to attract and maintain qualified and talented staf f with the
necessary technical, analytic and leadership skills to perform the work requirements of the Finance Department positions.
*2026/2027: On August 22, 2024, the federal government released proposed rules related to the Financial Data Transparency Act (FDTA). This
first proposed rule seeks to establish general guidelines for additional regulations. This law mandates that certain data and financial information
provided must be sent in a ‘structured data’ format after the rules are finalized (sometime in 2026 or thereafter). This effort to create new universal
reporting categories will have minimal value to transparency efforts and would be a significant cost to state and local governments. This unfunded
mandate would require extensive staff time along with the need for consulting resources and potentially risky updates to government financial
systems. This mandate poses a challenge as utilizing a specific technology for governmental and nonprofit financial reporting would require
identical financial reporting taxonomies across all types of public entities. Given the wide variety of governments and non-profit entities(e.g.,
states, cities, counties, water systems, public power, public gas, hospitals, etc.), combining all into a single standardized template has the potential
to lose valuable information and to reduce transparency by eliminating detail specific to the unique functions or services that governments provide.
Transitioning to or potentially adding new reporting categories would require changes to underlying financial systems. The la w does not provide
any financial assistance with these transition costs to hire consultants, reconfigure financial systems, or implement new software or to assist with
the ongoing staffing costs to support this additional reporting burden. If the proposed rules become law through regulatory r equirements,
additional staffing at the Senior Analyst/Senior Accountant level may be required.
Total FTEs in 2025 – 6.8
Finance 2026 2027 2028 2029 2030
Finance Director 1 1 1 1 1
Asst Finance Director 1 1 1 1 1
Sr Financial Analyst/Sr Accountant 1 1 1 1 1
Financial Analyst .8 .8 .8 .8 .8
Account Specialist 1 1 1 1 1
Utility Billing Clerk 2 2 2 2 2
TOTAL: 6.8 6.8 6.8 6.8 6.8
2026 – 2030 Personnel Plan / Page 9
FIRE
2026: In 2025, the Fire Department (FD) moved to professional paid-on-call (POC) shift firefighters for a variety of reasons. The new model
means the FD now only hires trained, certified firefighters/EMTs who are assigned specific shifts. In the past, FD hired individuals who were not
certified to state standards, required training, and worked on-call only. By making the change in hiring requirements and scheduling shifts, FD
has more reliable, professional support than with the old model. There are currently 26 POC firefighters/EMTs, and the 2026 budget includes a
request for a wage increase from $17.50/hr to $21/hr. This increase is necessary to keep pace with other departments’ POC wages and to
acknowledge the training and background of current POC firefighters/EMTs.
*2028: Firefighter (3 FTE). In the fall of 2024, the FD became the primary responder for all medical calls. As a result, there has been a 60%
increase in the number of call responses. We expect this number to increase as the community grows. The Department took significant steps to
handle this increase by putting a lite rescue vehicle in service, adding shift assigned POC firefighters, and separating crews into two vehicles. This
change has made the FD’s medical response more efficient and keeps the other apparatus clear to answer other calls. The request to add three
additional firefighters (one firefighter per shift) will enable the FD to put an additional apparatus into service 24 hours per day to meet the
anticipated rise in calls as the area grows. This also means the FD can continue its non-emergency duties while providing effective and efficient
emergency coverage.
Total FTEs in 2025 – 15
Total POC firefighters/EMTs - 26
Fire 2026 2027 2028 2029 2030
Fire Chief 1 1 1 1 1
Assistant Fire Chief 1 1 1 1 1
Fire Marshall 1 1 1 1 1
Full-time Fire Captain 3 3 3 3 3
Full-time Firefighter 9 9 12* 12 12
TOTAL:
15 15 18 18 18
2026 – 2030 Personnel Plan / Page 10
POLICE
The Prior Lake Police Department (PLPD) is unique in that it provides services to two communities - Prior Lake and the Shakopee Mdewakanton
Sioux Community (SMSC). The recently completed workload study offered recommendations to maintain current service levels, including
increasing the allocation of personnel for patrol to 22 officers (currently 17), seven sergeants (currently six), and administrative support.
Recognizing the budget impact of adding several positions in one year, the PD proposes to increme ntally add these positions over the next few
years which is detailed below.
*2025, 2027 (2), 2029, and 2030: Patrol Officer (5 FTEs). The workload study found that staffing in the Patrol Division is not adequate to manage
workload volumes and the appropriate geographic distribution of personnel. It is recommended that PLPD should adjust its deployment of
personnel for primary response from 17 to 22 patrol officers. This number is considered the operational minimum and is the baseline for staffing,
not the maximum. The study notes that the addition of four positions represents the full volume of calls for service currently being handled by
PLPD sergeants. In addition, this increase takes into account the ‘non-operational’ (vacancies to ensure staffing at operational minimal levels)
hours for officers who are in training, on leave, injured or otherwise unable to fulfill their duties. The study also recommends adding an additional
officer to the investigations unit. Currently, PLPD has three general investigation detectives, and the city would benefit from the additional
capacity. This would allow active cases to be diverted from patrol into investigations and increase the numbers of hours dedicated to each case
per investigator. Using savings from reduced overtime by reassigning the Mystic Lake Casino beat officers to patrol, a new FTE could be added i n
2025 with a budget neutral impact.
*2026: Sergeant (1 FTE). The workload study identified the addition of a seventh supervisor as the highest priority for PLPD. Although sergeants
are expected to provide guidance and support to patrol staff, PLPD sergeants too often take on a primary response role. The workload study found
that PLPD sergeants contribute over 2,000 hours annually toward primary/back-up response, which detracts from their responsibilities as
supervisors. Supervisors are expected to perform administrative functions, manage training efforts, and develop patrol officers, including
monitoring performance and addressing performance issues which is why they should not serve as primary responders for service calls. Per the
study, “For the PLPD, it is evident that its patrol supervisors have been relegated to a de facto patrol role, all but eliminating their ability to perform
the more complex and intended role they are assigned.” In addition, PLPD has difficulty maintaining daily staffing at the sergeant level because
there is no redundancy when a sergeant is on leave or off work.
*2026: Records Specialist (1 FTE). The workload on the records staff has increased markedly with the addition of several sworn officers since 2019;
however no additional staff have been added to that workgroup to adjust to the workload. Additionally, increased data practic es requests, video
redaction needs, and State mandated law changes have compounded the daily tasks and volume of work of the records staff. With an extensive
backlog of criminal justice data needing to be addressed as well as falling behind on daily data needs, there is an urgent priority to bring the records
group to a higher staffing level. This may impact another workload study recommendation regarding administrative functions across PLPD (see
below). In addition, the Evidence Technician has significantly reduced the years long backlog of old evidence which means this position will have
additional capacity. Therefore, this position will be re-evaluated to determine the best use of this resources, including expanding duties into
investigations and records support.
2026 – 2030 Personnel Plan / Page 11
*TBD: Administrative Assistant (1 FTE). With a total headcount of 39.42 FTEs, the PLPD currently has no dedicated administrative personnel. All
administrative functions fall under the Records Division which is understaffed. The workload study found that the Records Supervisor has a
workload equivalent to 2 full-time employees, primarily due to administrative support work. In addition, command staff and investigators provide
their own administrative support which takes them away from their primary duties. As such, the study recommends adding a full -time
administrative assistant position to assist with workloads and to support department operations. An analysis of administrative duties currently
being performed by the Records Division (e.g., from scheduling, answering phones, website updates, presentations, agenda reports) will help
develop the job description and allow records staff, supervisors, and investigators to focus on their primary duties.
Total FTEs in 2025 – 39.42
*One patrol officer position in 2026 is budget neutral due to scheduling adjustments and overtime savings.
Police 2026 2027 2028 2029 2030
Police Chief 1 1 1 1 1
Commander 2 2 2 2 2
Sergeant 7* 7 7 7 7
Patrol Officer/Investigator 25** 27* 27 28* 29*
Records Supervisor 1 1 1 1 1
Records Specialist 4.62* 4.62 4.62 TBD TBD
Community Service Officer .8 .8 .8 .8 .8
Evidence Room Technician 1 1 1 1 1
Admin Support Staff - TBD TBD TBD TBD
TOTAL: 42.42 44.42 44.42 45.42 46.42
2026 – 2030 Personnel Plan / Page 12
PUBLIC WORKS
Several events occurred in late 2024 and 2025 that escalated the implementation of the Public Works Department’s prior personnel plan. As a
result, Public Works does not foresee the need to hire additional staff for the next few years.
1. As part of the 2025 budget, a Public Works Supervisor (Utilities) was created and filled through a promotion. With millions of dollars’ worth
of utility maintenance projects over the next several years (sewer lining, SCADA upgrade, water treatment facility filter beds, etc.),
positioning a team member to lead the management and delivery of these projects is critical.
2. When the Public Works Operator (Streets) left the City, that position was reclassified into a Facility Maintenance Manager position, which
was originally slated as a new position in 2028. However, with capital improvement projects for City Hall, the Police Department, and
Maintenance Center planned, Public Works took the opportunity to add the position early. The position was filled in January 2025.
3. With the unexpected retirement of the part-time (.63 FTE) Recreation Programmer supporting Club Prior, the position was moved to full-
time in late 2024 to expand the hours and offerings at Club Prior and to support community events and other recreation services.
4. In the fall of 2024, the current Public Works Director/City Engineer resigned, and the Assistant Public Works Director was promoted into that
position. The Assistant position was reclassified into a Maintenance Superintendent position.
Total FTEs in 2025 – 41
Public Works 2026 2027 2028 2029 2030
PW Director/City Engineer 1 1 1 1 1
Superintendent 1 1 1 1 1
Supervisor 3 3 3 3 3
Facility Maintenance Manager 1 1 1 1 1
Mechanics 3 3 3 3 3
Maintenance Worker/Operator 21 21 21 21 21
Facilities Maintenance Worker 1 1 1 1 1
GIS Coordinator 1 1 1 1 1
PW Specialist 1 1 1 1 1
Asst City Engineer 1 1 1 1 1
Engineering Tech 2 2 2 2 2
Project Engineer-Stormwater 1 1 1 1 1
Parks & Recreation Manager 1 1 1 1 1
Recreation Supervisor 1 1 1 1 1
Recreation Programmer 2 2 2 2 2
TOTAL: 41 41 41 41 41
2026 – 2030 Personnel Plan / Page 13
ATTACHMENT B: Org Chart
1
2026 Proposed Tax Levy Components
Attachment 3
LEVY CHANGE – 7.58%
Personnel Adds: 1.73%
Personnel Adds - $345,000 The city’s current full-time equivalent (FTE) headcount is 122.02. It is proposed to increase by 3 FTE to 125.02 in
2026. The 2026 budget includes new tax levy funding of $346k for a new Network Administrator position (July 2026
start), and the addition of a Police Sergeant and a Police Records Specialist.
Capital Improvement Program (CIP) Tax Levy Components – 0.05%
Equipment Replacement funding – ($100,000) The Equipment Replacement Plan (ERP) utilizes general tax levies to support replacement of the City’s equipment
and vehicle fleet. The ten-year average annual cost for the plan is about $1.65M. The financing plan reflects a
gradual increase in the tax levy until the annual levy reaches our annual funding goal. The proposed total levy for
2026 is $925k. The 2025 amount included a levy in advance of $150k, for a total of $1.025M which is why this
shows as a decrease from prior year. Since the proposed levy increase is gradual, bonding may be required for the
plan to meet our funding needs.
Park Equipment Replacement funding -$60,000 The Revolving Park Plan funds capital replacement projects, park amenities, and trail, sidewalk, and boardwalk
replacement. The plan proposes a phased increase in the tax levy to cover the capital projects in the plan. The
proposed total levy for 2026 is $595k.
Facilities Management Plan funding -$50,000
The Facility Management Plan (FMP) was developed to plan for major repairs, replacements, and upgrades for all
city facilities on a long-term basis (25 years). It does not cover minor expenses for repairs and maintenance.
Those will continue to be funded through the operating budgets. 2026 capital projects include projects at the
Police station, Library & Club Prior, Maintenance Center and City Hall. The proposed total levy for 2026 is $305k.
Mandatory Items – 5.80%
STAFFING
Wage/COLA and Benefits - $847,000
The budget includes a proposed cost of living adjustment, step increases, city payroll taxes and health/dental
insurance premium contribution increase, as well as incorporating the financial impacts of the police compensation
study that was completed in 2025. Union negotiations will be held in the fall of 2025.
CURRENT EXPENDITURES
Professional Services – ($265,000) • Reduction in funding for professional services primarily to decreases in Engineering, Human Resources, Police
and Parks professional services needs compared to 2025. In 2025 there were professional services in
Engineering as the department works on filling open positions. Also, there was $81k in professional services
budgeted for the compensation studies and park referendum consulting costs.
Supplies – ($24,000)
• This includes a $54k decrease for fuel and small equipment.
• There are offsetting increases of $29k in operating supplies, all repairs & maintenance supplies, uniforms/PPE,
etc.
2
Other Services and Charges – $156,000 • This includes a $92k increase for software service contracts primarily due to $40k budgeted for ADA compliant
website, $24k for new Police software, $18k for new IT needs and $11k for new Recreation software
implementation
• $34k increase in utilities (electric/gas)
• $16k increase in memberships/subscriptions, primarily for Fire, Administration and Police
Maintenance Agreements – $56,000
Increase in funding for maintenance agreements including general, building and equipment maintenance due to
increases in fertilizer & weed spraying, trees and vegetation, contracted mowing and graffiti removal services and
new development sealcoat.
Capital Outlay – $74,000 2026 costs are estimated to be $74k more than the prior year. 2026 includes a high-speed ballot scanner
recommended by Scott County ($30k) and IT increase of $80k to replace SAN and servers, as well as switch
replacement.
Non-Tax Revenue – ($259,000) • Intergovernmental revenue is increasing by $196k compared to 2025. This includes:
o $131k increase in township fire/rescue aid based on the fire agreement
o $76k increase in state road and bridge aid
o $60k increase in police state aid
o Partially offset by decrease in capital grants of $106k
• Increase of $53k for City Contracted Services based on 2024 revenue plus increased Police contracted rate due
to 2025 compensation study.
• Increase of $35k for project admin/engineering fees based on the proposed projects.
• Increase in Transfer-In as a funding source of $53k. This is based on operating transfers from the utility funds.
• Increase in interest earnings of $16k. Budget reflects anticipated earnings on investments.
• Revenue from residential building permits/fees budget is $117k less than the 2025 budget. The city collects
building permits and plan check revenue on new residential and townhome units built. Prior Lake is still
growing, but the 2026 estimate for new construction units is 50 single family/0 townhomes (50 total) which
generates less revenue than the 2025 budget mix of 60 single family/20 townhomes (80 total).
• Franchise fee revenue decrease of $27k.
OTHER
Change in Use of Reserves - $460,000
2025 Use of Reserves $460,000
2026 Proposed Use of Reserves $0
$460k change in use of reserves due to 2025 budget amendments.
Background information: The city’s comprehensive financial management plan calls for maintaining a fund balance
between 40-50% to ensure adequate reserves for cash flow, unplanned expenditures, and to maintain the city’s
credit worthiness (AAA credit rating). Staff recommends the use of reserves for one-time expenditures or revenue
shortfall; otherwise, the fund balance could drop below the level stated in the comprehensive financial
management plan over time.
2025 Council approved budget amendments resulted in use of reserves of $460k. Reserves were used for
carryforward items budgeted in 2025 and Police wage adjustments based on LELS labor agreements. The total 2026
planned use of reserves is $0. Over the next several years, the city may need to levy to maintain a reserve balance
of 40%-50% of the subsequent year’s expenditures.
Other Items – $108,000
Increase in debt service compared to 2025.
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
Fund 101 - GENERAL FUND
TAXES
31010.00 Current Property Taxes - General Purpos 12,957,796 13,832,904 13,832,904 15,225,983 1,393,079 10.07
31020.00 Delinquent Property Taxes - General Purp 17,543
31040.00 Fiscal Disparities 975,152 1,278,316 1,278,316 1,278,316
33423.00 Market Value Credit Aid 489
TAXES 13,950,980 15,111,220 15,111,220 16,504,299 1,393,079 9.22
FRANCHISE TAXES
31810.00 Franchise Taxes 543,869 555,000 555,000 528,000 (27,000) (4.86)
FRANCHISE TAXES 543,869 555,000 555,000 528,000 (27,000) (4.86)
INTERGOVERNMENTAL
33160.10 Fed Aids/Grants - Operating Grants
33160.11 Fed Aids/Grants - Operating Police 12,350
33401.00 Local Government Aid
33416.01 State Aid - Police Train 31,423 30,000 30,000 30,000
33416.02 State Police Aid-Ins Prem 378,355 318,000 318,000 378,000 60,000 18.87
33417.00 State Aid - Fire Training 41,839
33418.00 State Road & Bridge Aid 443,943 476,340 476,340 552,295 75,955 15.95
33420.00 State Fire Aid-Ins. Prem.372,010 348,527 348,527 387,258 38,731 11.11
33422.10 State Aids/Grants - Operating Grants
33422.11 State Aids/Grants - Operating Police 17,466
33610.10 County-City Aids/Grants - Operating Gran 170
33610.11 County-City Aids/Grants - Operating Poli 4,072
33620.00 Township Fire & Resc Aid 960,250 961,430 961,430 1,092,405 130,975 13.62
33621.00 Liaison Aid 84,742 72,287 72,287 68,430 (3,857) (5.34)
33631.00 Payment in Lieu of Taxes 1,200,000 1,400,000 1,400,000 1,400,000
33700.10 Miscellaneous Grants - Operating Grants 36,631
33700.20 Miscellaneous Grants - Capital Grants 106,250 (106,250) (100.00)
33700.23 Miscellaneous Grants - Capital Parks 2,834
INTERGOVERNMENTAL 3,586,085 3,606,584 3,712,834 3,908,388 195,554 5.27
CHARGES FOR SERVICES
34103.00 Zoning & Subdivision Fees 37,778 40,000 40,000 40,000
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
34104.00 Plan Check Fees 332,114 203,430 203,430 157,545 (45,885) (22.56)
34105.00 Sale of Maps/Publications - Reports 175 500 500 500
34107.00 Assessment Searches - Reports 425 500 500 500
34108.00 Street Chip Seal Fee-New Development
34109.00 Project Admin/Eng Fees 240,223 150,000 150,000 185,000 35,000 23.33
34203.00 Accident/Warrant Reports - Reports 330 200 200 500 300 150.00
34731.00 Adult League Fees 4,274 5,000 5,000 5,000
34732.00 Recreation Program Fees - Contracted 50,967 40,000 40,000 45,000 5,000 12.50
34735.00 Recreation Program Fees - Staff Run 68,531 70,000 70,000 70,000
34735.01 Recreation Program Fees - Club Prior 13,970 12,000 12,000 15,000 3,000 25.00
34740.00 Concessions - Park Fees
34760.01 Facility Rental - Regular 49,216 66,449 66,449 68,088 1,639 2.47
34760.87 Facility Rental - Lease 15,045
34761.00 Studio/Pavilion Rental 37,315 27,500 27,500 30,000 2,500 9.09
34762.00 Park Shelter Rental 22,680 20,000 20,000 22,000 2,000 10.00
34762.01 Boat Slip Rental 65,875 72,000 72,000 72,000
34765.01 Tower Leases
34765.87 Tower Leases - Lease 282,809 273,183 273,183 289,104 15,921 5.83
34780.00 Parking Meter Fees 33,254 30,000 30,000 30,000
34782.00 Sign Lease Fees
34783.00 City Contract Services 256,447 229,960 229,960 283,053 53,093 23.09
CHARGES FOR SERVICES 1,511,428 1,240,722 1,240,722 1,313,290 72,568 5.85
SPECIAL ASSESSMENTS
36101.00 City Assess. Collections
36102.00 County Assess. Collection 5,057 4,000 4,000 4,000
SPECIAL ASSESSMENTS 5,057 4,000 4,000 4,000
INTEREST (LOSSES) ON INVESTMENTS
36210.00 Interest Earnings 368,872 277,500 277,500 293,500 16,000 5.77
36210.87 Interest Earnings 156,172
36215.00 Amortization - Premium/Discount 73,934 (20,000) (20,000) 20,000 (100.00)
36225.00 Unrealized Inv.Gain(Loss)93,577
36226.00 Realized Inv Gain/(Loss)
INTEREST (LOSSES) ON INVESTMENTS 692,555 257,500 257,500 293,500 36,000 13.98
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
MISCELLANEOUS REVENUES
36211.00 Developer Agreements 28,035 50,000 50,000 57,300 7,300 14.60
36212.00 Miscellaneous Revenue 523,543 69,800 69,800 70,000 200 0.29
36230.00 Contributions & Donations 10,769
36230.11 Contributions - Shop with a Cop 2,665
36230.12 Contributions and Donations 2,000
36230.13 Contributions and Donations 18,444
36230.33 Contributions - Charitable Gambling 28,500
MISCELLANEOUS REVENUES 613,956 119,800 119,800 127,300 7,500 6.26
SALE OF ASSETS
39102.00 Sale of Property 5,086
SALE OF ASSETS 5,086
TRANSFERS IN
39203.00 Transfer from Other Funds 876,400 615,000 615,000 668,000 53,000 8.62
TRANSFERS IN 876,400 615,000 615,000 668,000 53,000 8.62
LICENSES AND PERMITS
32100.00 Business Licenses 2,200 2,000 2,000 2,200 200 10.00
32110.00 Liquor Licenses 73,795 80,470 80,470 73,795 (6,675) (8.30)
32120.00 Cannabis Fee 4,200
32160.00 Refuse Haulers 6,290 5,900 5,900 6,290 390 6.61
32175.00 Public Private Gathering Permit 90
32180.00 Cigarette Licenses 2,795 2,250 2,250 2,750 500 22.22
32185.00 Food Truck Registration
32190.00 Community Event Application 1,980 2,500 2,500 2,000 (500) (20.00)
32210.00 Building Permits 631,834 312,962 312,962 242,097 (70,865) (22.64)
32211.00 Retainage Forfeiture
32215.00 Mechanical Permits 68,350 78,120 78,120 75,399 (2,721) (3.48)
32230.00 Plumbing Permits 67,899 55,620 55,620 56,703 1,083 1.95
32231.00 Sewer/Water Inspection 2,998 4,520 4,520 4,916 396 8.76
32232.00 Plumbing Registrations
32260.00 Burning Permits 4,550 5,000 5,000 4,560 (440) (8.80)
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
32270.00 Short-term Rental Fee 1,955 1,500 1,500 2,000 500 33.33
LICENSES AND PERMITS 868,936 550,842 550,842 472,710 (78,132) (14.18)
FINES AND FORFEITURES
35101.00 County Court Fines 100,632 108,000 108,000 108,000
35104.00 Prosecution Restitution 3,134
FINES AND FORFEITURES 103,766 108,000 108,000 108,000
TOTAL - FUND 101 22,758,118 22,168,668 22,274,918 23,927,487 1,652,569 7.42
DEBT SERVICE FUNDS
TAXES
31015.00 Current Property Taxes - Debt Service 3,187,883 2,929,190 2,929,190 3,031,057 101,867 3.48
TAXES 3,187,883 2,929,190 2,929,190 3,031,057 101,867 3.48
INTEREST (LOSSES) ON INVESTMENTS
36210.00 Interest Earnings 108,577 77,100 77,100 89,800 12,700 16.47
36225.00 Unrealized Inv.Gain(Loss)35,140
INTEREST (LOSSES) ON INVESTMENTS 143,717 77,100 77,100 89,800 12,700 16.47
DEBT ISSUED
39310.00 G.O. Bond Proceeds
DEBT ISSUED
OTHER FINANCING SOURCES
39315.00 Projects - Bond Premium
OTHER FINANCING SOURCES
TRANSFERS IN
39203.00 Transfer from Other Funds 968,114 1,256,974 1,256,974 1,305,156 48,182 3.83
TRANSFERS IN 968,114 1,256,974 1,256,974 1,305,156 48,182 3.83
SPECIAL ASSESSMENTS
36101.00 City Assess. Collections 1,306,399
36102.00 County Assess. Collection 427,419 569,714 569,714 460,815 (108,899) (19.11)
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
SPECIAL ASSESSMENTS 1,733,818 569,714 569,714 460,815 (108,899) (19.11)
MISCELLANEOUS REVENUES
36212.00 Miscellaneous Revenue 17,000
MISCELLANEOUS REVENUES 17,000
TOTAL - DEBT SERVICE FUNDS 6,050,532 4,832,978 4,832,978 4,886,828 53,850 1.11
Fund 210 - CABLE FRANCHISE FUND
CHARGES FOR SERVICES
34304.00 PEG Access Fees 13,368 17,000 17,000 12,000 (5,000) (29.41)
CHARGES FOR SERVICES 13,368 17,000 17,000 12,000 (5,000) (29.41)
INTEREST (LOSSES) ON INVESTMENTS
36210.00 Interest Earnings 3,645
36225.00 Unrealized Inv.Gain(Loss)880
INTEREST (LOSSES) ON INVESTMENTS 4,525
TOTAL - FUND 210 17,893 17,000 17,000 12,000 (5,000) (29.41)
Fund 225 - CAPITAL PARK FUND
INTERGOVERNMENTAL
33160.20 Fed Aids/Grants - Capital Grants 1,000,000 1,000,000 (1,000,000) (100.00)
33700.20 Miscellaneous Grants - Capital Grants
INTERGOVERNMENTAL 1,000,000 1,000,000 (1,000,000) (100.00)
CHARGES FOR SERVICES
34760.01 Facility Rental - Regular 24,800 32,000 32,000 25,200 (6,800) (21.25)
34760.87 Facility Rental - Lease
34791.00 Dedication Fees 36,810 300,000 300,000 187,500 (112,500) (37.50)
CHARGES FOR SERVICES 61,610 332,000 332,000 212,700 (119,300) (35.93)
INTEREST (LOSSES) ON INVESTMENTS
36210.00 Interest Earnings 56,165 43,800 43,800 41,400 (2,400) (5.48)
36210.87 Interest Earnings (715)
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
36225.00 Unrealized Inv.Gain(Loss)14,357
INTEREST (LOSSES) ON INVESTMENTS 69,807 43,800 43,800 41,400 (2,400) (5.48)
MISCELLANEOUS REVENUES
36230.00 Contributions & Donations 7,450
MISCELLANEOUS REVENUES 7,450
TOTAL - FUND 225 138,867 1,375,800 1,375,800 254,100 (1,121,700) (81.53)
Fund 240 - EDA SPECIAL REVENUE FUND
TAXES
31010.00 Current Property Taxes - General Purpos 365,707 382,506 382,506 378,076 (4,430) (1.16)
31040.00 Fiscal Disparities 21,490 22,494 22,494 26,924 4,430 19.69
TAXES 387,197 405,000 405,000 405,000
CHARGES FOR SERVICES
34760.02 Facility Rental - EDA 27,867 24,588 24,588 26,988 2,400 9.76
CHARGES FOR SERVICES 27,867 24,588 24,588 26,988 2,400 9.76
INTEREST (LOSSES) ON INVESTMENTS
36210.00 Interest Earnings 12,913 9,800 9,800 11,100 1,300 13.27
36225.00 Unrealized Inv.Gain(Loss)4,064
36226.00 Realized Inv Gain/(Loss)
INTEREST (LOSSES) ON INVESTMENTS 16,977 9,800 9,800 11,100 1,300 13.27
MISCELLANEOUS REVENUES
36230.00 Contributions & Donations
MISCELLANEOUS REVENUES
TRANSFERS IN
39203.00 Transfer from Other Funds
TRANSFERS IN
TOTAL - FUND 240 432,041 439,388 439,388 443,088 3,700 0.84
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
Fund 410 - REVOLVING EQUIPMENT FUND
TAXES
31010.00 Current Property Taxes - General Purpos 796,530 875,000 875,000 925,000 50,000 5.71
31015.00 Current Property Taxes - Debt Service 150,000 150,000 (150,000) (100.00)
TAXES 796,530 1,025,000 1,025,000 925,000 (100,000) (9.76)
INTEREST (LOSSES) ON INVESTMENTS
36210.00 Interest Earnings 20,932 20,400 20,400 14,000 (6,400) (31.37)
36225.00 Unrealized Inv.Gain(Loss)7,642
INTEREST (LOSSES) ON INVESTMENTS 28,574 20,400 20,400 14,000 (6,400) (31.37)
MISCELLANEOUS REVENUES
39104.00 Forfeiture Property Sales
MISCELLANEOUS REVENUES
SALE OF ASSETS
39102.00 Sale of Property 294,704
SALE OF ASSETS 294,704
TRANSFERS IN
39203.00 Transfer from Other Funds 400,000 342,166 342,166 (342,166) (100.00)
TRANSFERS IN 400,000 342,166 342,166 (342,166) (100.00)
DEBT ISSUED
39310.00 G.O. Bond Proceeds
DEBT ISSUED
TOTAL - FUND 410 1,519,808 1,387,566 1,387,566 939,000 (448,566) (32.33)
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
Fund 430 - REVOLVING PARK EQUIP FUND
TAXES
31010.00 Current Property Taxes - General Purpos 458,181 535,000 535,000 595,000 60,000 11.21
TAXES 458,181 535,000 535,000 595,000 60,000 11.21
INTERGOVERNMENTAL
33160.20 Fed Aids/Grants - Capital Grants 212,500 212,500
33700.20 Miscellaneous Grants - Capital Grants 13,672
INTERGOVERNMENTAL 13,672 212,500 212,500
INTEREST (LOSSES) ON INVESTMENTS
36210.00 Interest Earnings 30,764 32,500 32,500 28,200 (4,300) (13.23)
36225.00 Unrealized Inv.Gain(Loss)9,108
INTEREST (LOSSES) ON INVESTMENTS 39,872 32,500 32,500 28,200 (4,300) (13.23)
MISCELLANEOUS REVENUES
36230.00 Contributions & Donations 170,000 170,000
MISCELLANEOUS REVENUES 170,000 170,000
TRANSFERS IN
39203.00 Transfer from Other Funds
TRANSFERS IN
DEBT ISSUED
39310.00 G.O. Bond Proceeds 1,030,000 1,030,000 (1,030,000) (100.00)
DEBT ISSUED 1,030,000 1,030,000 (1,030,000) (100.00)
TOTAL - FUND 430 511,725 1,597,500 1,597,500 1,005,700 (591,800) (37.05)
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
Fund 440 - FACILITIES MANAGEMENT FUND
TAXES
31010.00 Current Property Taxes - General Purpos 204,419 255,000 255,000 305,000 50,000 19.61
TAXES 204,419 255,000 255,000 305,000 50,000 19.61
INTERGOVERNMENTAL
33160.00 Fed Aids/Grants
33620.00 Township Fire & Resc Aid
33700.10 Miscellaneous Grants - Operating Grants 47,000 47,000 (47,000) (100.00)
INTERGOVERNMENTAL 47,000 47,000 (47,000) (100.00)
INTEREST (LOSSES) ON INVESTMENTS
36210.00 Interest Earnings 43,750 35,800 35,800 28,700 (7,100) (19.83)
36225.00 Unrealized Inv.Gain(Loss)13,733
INTEREST (LOSSES) ON INVESTMENTS 57,483 35,800 35,800 28,700 (7,100) (19.83)
TRANSFERS IN
39203.00 Transfer from Other Funds 24,000 60,000 60,000
TRANSFERS IN 24,000 60,000 60,000
DEBT ISSUED
39310.00 G.O. Bond Proceeds 515,000 515,000 1,500,000 985,000 191.26
DEBT ISSUED 515,000 515,000 1,500,000 985,000 191.26
TOTAL - FUND 440 285,902 852,800 852,800 1,893,700 1,040,900 122.06
Fund 450 - PERMANENT IMPROVEMENT REVOLVING FUND
TAXES
31010.00 Current Property Taxes - General Purpos
TAXES
FRANCHISE TAXES
31810.00 Franchise Taxes 1,096,647
FRANCHISE TAXES 1,096,647
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
INTERGOVERNMENTAL
33610.25 County-City Aids/Grants - Capital PW 23,573
INTERGOVERNMENTAL 23,573
SPECIAL ASSESSMENTS
36101.00 City Assess. Collections 939,493
36102.00 County Assess. Collection 42,224 298,642 298,642 178,246 (120,396) (40.31)
SPECIAL ASSESSMENTS 981,717 298,642 298,642 178,246 (120,396) (40.31)
INTEREST (LOSSES) ON INVESTMENTS
36210.00 Interest Earnings 45,379 48,300 48,300 26,100 (22,200) (45.96)
36225.00 Unrealized Inv.Gain(Loss)4,453
INTEREST (LOSSES) ON INVESTMENTS 49,832 48,300 48,300 26,100 (22,200) (45.96)
TRANSFERS IN
39203.00 Transfer from Other Funds 615,441 300,000 300,000 (300,000) (100.00)
TRANSFERS IN 615,441 300,000 300,000 (300,000) (100.00)
DEBT ISSUED
39310.00 G.O. Bond Proceeds 1,580,000
DEBT ISSUED 1,580,000
TOTAL - FUND 450 4,347,210 646,942 646,942 204,346 (442,596) (68.41)
Fund 601 - WATER FUND
INTERGOVERNMENTAL
33422.15 State Aids/Grants - Operating Public Wor 5,437
INTERGOVERNMENTAL 5,437
CHARGES FOR SERVICES
37106.00 Spring Lake Township Utility Surcharge
CHARGES FOR SERVICES
SPECIAL ASSESSMENTS
36102.00 County Assess. Collection 6,248
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
SPECIAL ASSESSMENTS 6,248
INTEREST (LOSSES) ON INVESTMENTS
36210.00 Interest Earnings 290,835 196,500 196,500 237,900 41,400 21.07
36225.00 Unrealized Inv.Gain(Loss)64,554
INTEREST (LOSSES) ON INVESTMENTS 355,389 196,500 196,500 237,900 41,400 21.07
MISCELLANEOUS REVENUES
36212.00 Miscellaneous Revenue 14,935
37190.00 Miscellaneous Revenue Adj
MISCELLANEOUS REVENUES 14,935
TRANSFERS IN
39203.00 Transfer from Other Funds 257,313
TRANSFERS IN 257,313
CAPITAL CONTRIBUTIONS FROM OTHER FUNDS
37901.00 Contribution (Other Fund)1,856,220
57901.00 Capital Contributions (Other Fund)
CAPITAL CONTRIBUTIONS FROM OTHER FUNDS 1,856,220
CAPITAL CONTRIBUTIONS FROM DEVELOPERS
37902.00 Contribution (Developers)
CAPITAL CONTRIBUTIONS FROM DEVELOPERS
OTHER FINANCING SOURCES
39315.00 Projects - Bond Premium 16,160
OTHER FINANCING SOURCES 16,160
CONTRIBUTIONS AND DONATIONS
36231.00 PERA Pension Contributions 15,729
CONTRIBUTIONS AND DONATIONS 15,729
WATER CHARGES
37100.00 Utility Receipts - Water 3,515,380 4,439,648 4,439,648 4,117,125 (322,523) (7.26)
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
37160.00 Penalties 9,636 10,000 10,000 10,000
WATER CHARGES 3,525,016 4,449,648 4,449,648 4,127,125 (322,523) (7.25)
CAPITAL FACILITY CHARGES
37110.00 Utility Base Fee Revenue 1,389,992 1,412,862 1,412,862 1,468,569 55,707 3.94
CAPITAL FACILITY CHARGES 1,389,992 1,412,862 1,412,862 1,468,569 55,707 3.94
METER SALES
37170.00 Water Meter Sales 49,859 56,625 56,625 50,725 (5,900) (10.42)
37175.00 Pressure Reducers 11,548 15,900 15,900 12,900 (3,000) (18.87)
METER SALES 61,407 72,525 72,525 63,625 (8,900) (12.27)
TOTAL - FUND 601 7,503,846 6,131,535 6,131,535 5,897,219 (234,316) (3.82)
Fund 602 - STORM WATER UTILITY
INTERGOVERNMENTAL
33422.10 State Aids/Grants - Operating Grants 38,000
33610.20 County-City Aids/Grants - Capital Grants
INTERGOVERNMENTAL 38,000
SPECIAL ASSESSMENTS
36102.00 County Assess. Collection (6,572)
SPECIAL ASSESSMENTS (6,572)
INTEREST (LOSSES) ON INVESTMENTS
36210.00 Interest Earnings 136,623 69,300 69,300 100,100 30,800 44.44
36225.00 Unrealized Inv.Gain(Loss)24,031
INTEREST (LOSSES) ON INVESTMENTS 160,654 69,300 69,300 100,100 30,800 44.44
MISCELLANEOUS REVENUES
36212.00 Miscellaneous Revenue
MISCELLANEOUS REVENUES
TRANSFERS IN
39203.00 Transfer from Other Funds 2,395
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
TRANSFERS IN 2,395
CAPITAL CONTRIBUTIONS FROM OTHER FUNDS
37901.00 Contribution (Other Fund)414,512
CAPITAL CONTRIBUTIONS FROM OTHER FUNDS 414,512
CAPITAL CONTRIBUTIONS FROM DEVELOPERS
37902.00 Contribution (Developers)
CAPITAL CONTRIBUTIONS FROM DEVELOPERS
OTHER FINANCING SOURCES
39315.00 Projects - Bond Premium 1,248
OTHER FINANCING SOURCES 1,248
CONTRIBUTIONS AND DONATIONS
36231.00 PERA Pension Contributions 3,061
CONTRIBUTIONS AND DONATIONS 3,061
WATER CHARGES
37160.00 Penalties 1,723 1,500 1,500 1,500
WATER CHARGES 1,723 1,500 1,500 1,500
STORM WATER CHARGES
32250.00 Wetland Conservation Act Fees 300
37120.00 Storm Water Revenue 1,626,421 2,000,772 2,000,772 2,125,713 124,941 6.24
STORM WATER CHARGES 1,626,721 2,000,772 2,000,772 2,125,713 124,941 6.24
TOTAL - FUND 602 2,241,742 2,071,572 2,071,572 2,227,313 155,741 7.52
Fund 604 - SEWER FUND
INTERGOVERNMENTAL
33630.20 Metro Council Grants - Capital
INTERGOVERNMENTAL
CHARGES FOR SERVICES
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
37106.00 Spring Lake Township Utility Surcharge
CHARGES FOR SERVICES
SPECIAL ASSESSMENTS
36102.00 County Assess. Collection 4,911
SPECIAL ASSESSMENTS 4,911
INTEREST (LOSSES) ON INVESTMENTS
36210.00 Interest Earnings 145,480 106,400 106,400 119,500 13,100 12.31
36225.00 Unrealized Inv.Gain(Loss)32,295
INTEREST (LOSSES) ON INVESTMENTS 177,775 106,400 106,400 119,500 13,100 12.31
MISCELLANEOUS REVENUES
36212.00 Miscellaneous Revenue 6,250
37190.00 Miscellaneous Revenue Adj
MISCELLANEOUS REVENUES 6,250
SALE OF ASSETS
39102.00 Sale of Property
SALE OF ASSETS
TRANSFERS IN
39203.00 Transfer from Other Funds 88,032
TRANSFERS IN 88,032
CAPITAL CONTRIBUTIONS FROM OTHER FUNDS
37901.00 Contribution (Other Fund)1,229,310
CAPITAL CONTRIBUTIONS FROM OTHER FUNDS 1,229,310
CAPITAL CONTRIBUTIONS FROM DEVELOPERS
37902.00 Contribution (Developers)
CAPITAL CONTRIBUTIONS FROM DEVELOPERS
OTHER FINANCING SOURCES
39315.00 Projects - Bond Premium 16,160
2024 2025 2025 2026 2026 2026
ACTIVITY COUNCIL ADOPTED AMENDED PROPOSED PROPOSED PROPOSED
ACCOUNT DESCRIPTION BUDGET BUDGET BUDGET AMT CHANGE % CHANGE
From Amended Budget
REVENUES - DETAIL
CITY OF PRIOR LAKE
BUDGET REPORT
OTHER FINANCING SOURCES 16,160
CONTRIBUTIONS AND DONATIONS
36231.00 PERA Pension Contributions 9,919
CONTRIBUTIONS AND DONATIONS 9,919
WATER CHARGES
37160.00 Penalties 6,449 5,000 5,000 6,000 1,000 20.00
WATER CHARGES 6,449 5,000 5,000 6,000 1,000 20.00
CAPITAL FACILITY CHARGES
37110.00 Utility Base Fee Revenue 1,206,346 1,311,476 1,311,476 1,527,666 216,190 16.48
CAPITAL FACILITY CHARGES 1,206,346 1,311,476 1,311,476 1,527,666 216,190 16.48
SEWER CHARGES
37102.00 Utility Receipts - Sewer 1,928,213 2,172,946 2,172,946 2,355,762 182,816 8.41
37104.00 Utility Recpt-Sewer MCES 1,975,174 2,092,022 2,092,022 2,117,886 25,864 1.24
SEWER CHARGES 3,903,387 4,264,968 4,264,968 4,473,648 208,680 4.89
TOTAL - FUND 604 6,648,539 5,687,844 5,687,844 6,126,814 438,970 7.72
TOTAL - ALL FUNDS 52,456,223 47,209,593 47,315,843 47,817,595 501,752 1.06
608,002 1.29
From Original Budget
2026 Preliminary Tax Levy and Budget
July 22, 2025
PriorLakeMN.gov
Agenda
2
2026:
Tax Levy Considerations
Budget and Proposed Tax Levy Assumption
Proposed Tax Levy Change and Tax Rate
Residential Impact
General Fund Reserves
PriorLakeMN.gov
* Used March YTD wage growth of 4.3% as 72% of city
budget is personnel costs.
3
2026 Base Tax Levy Considerations
Growth (New Construction)1.6%
Wage Growth *4.3%
Debt Service 0.9%
Unfunded Mandates 0.6%
Base Property Tax Levy Considerations 7.4%
PriorLakeMN.gov 4
U.S. inflation rate versus wage growth 2021-
2025
March 2025:
•Wages 4.3%
•Inflation 2.4%
PriorLakeMN.gov
2026 Budget and Property Tax Assumptions
5
Growth in tax capacity and market value assumptions for pay 2026:
Estimated market value has increased 4% to $5.9B
Estimated tax capacity has increased 5% to $65.6M
Revenue Assumptions:
Building permits of 50/year (50 single family/0 townhomes)
SMSC aid for Policing – no proposed increase for 2026 budget
Fire service contract/City of Credit River and Spring Lake Township – incorporates financial impact of
Full-time Fire staffing model
PriorLakeMN.gov
2026 Budget and Property Tax Assumptions
6
Staffing Changes per Personnel Plan
2026:
•Network Administrator (July 2026 start)
•Police Sergeant
•Police Records Specialist
•Salary and wages assume 3.0% increase
•Paid family medical leave beginning in 2026 (0.88% split between employer and
employee)
Funding to support inflation for wages and goods & services
Commitments to long-term plans (CIP)
PriorLakeMN.gov
Property Tax Projection Summary
•Total CITY tax levy of $21,360,355 which is
a 7.6% increase from the prior year levy
based on the preliminary budgets.
•City tax rate of 31.4% (2.82% increase).
•Total EDA tax levy of $405,000 which is a
0% increase from the prior year levy based
on the preliminary budgets.
•EDA tax rate of .60% (4.97% decrease).
7
CITY OF PRIOR LAKE
PROPERTY TAX PROJECTION SUMMARY - CITY
Adopted
Budget 2025
Proposed
Budget 2026
TAX LEVIES - CITY 19,855,410 21,360,355
TOTAL $ CHANGE IN TAX LEVIES 1,155,263 1,504,945
TOTAL % CHANGE IN TAX LEVIES 6.18%7.58%
CITY TAX CAPACITY TAX RATE 30.5%31.4%
Annual % Change -city only excludes EDA 0.74%2.82%
CITY MARKET VALUE TAX RATE 0.00464%0.00451%
Annual % Change 1.41%-2.95%
PROPERTY TAX PROJECTION SUMMARY - EDA
Adopted
Budget 2025
Proposed
Budget 2026
TAX LEVY - EDA 405,000 405,000
TOTAL $ CHANGE IN TAX LEVIES 15,000 -
TOTAL % CHANGE IN TAX LEVIES 3.9%0.0%
EDA TAX RATE 0.63%0.60%
Annual % Change -0.28%-4.97%
PriorLakeMN.gov 8
•The 2026 proposed
tax levy increase is
$1,505,000
•The proposed tax
levy increase is 7.6%
•Public Safety
represents 42% of the
tax levy increase
Components of the Tax Levy Change
PriorLakeMN.gov 9
2026 Proposed Budget & Tax Levy Change
Staffing:Current Expenditures and Capital Outlay:
472 Wages/PERA/Tax Increase -24 Supplies
270 Health insurance increase -265 Professional Services
54 New MN Paid Leave 92 Software Contracts
39 FRA pension (passthrough)56 Maintenance Agreements
12 Other (comp absences, sick leave buy-down, allowances, seasonal OT)64 Other Services and Charges
847 Subtotal Personnel related cost increase 74 Capital Outlay
-3 Current Expenditures and Capital Outlay
Non-Tax Revenue:
196 Increase in intergovernmental revenue Other Levy Impacts:
53 Increase in city contracted services revenue 460 Change in Use of Reserves
35 Increase in project admin/engineering fees 105 Increase in Debt Service
53 Increase in transfers in from utility funds 565 Total Other Levy Impacts
16 Increase in tower lease revenue
36 Increase in interest earnings
-117 Reduction in residentital building permits/fees revenue
-27 Reduction in franchise fees
14 Other net increase
-259 Non-tax revenue increase (tax levy reduction)
PriorLakeMN.gov
•Estimated market value has
increased 4% for pay 2026.
•The estimated increase in city
tax is $76 for a median valued
home of $433,600 for pay
2025.
10
Residential Impact of the Proposed City
Tax Levy Change
% Net Net Net Net Net Net
of Inc/Dec Difference Inc/Dec Difference Inc/Dec Difference
Inc/Dec Total 25 vs 26 % Change 25 vs 26 % Change 25 vs 26 % Change
+15.01+%71 1%265$ 20.0%415$ 21.4%699$ 20.1%
+10.01-15.00%49 1%227$ 17.2%355$ 18.4%599$ 17.2%
+5.01-10.00%1,707 18%152$ 11.5%236$ 12.2%401$ 11.5%
+0.01-5.00%5,055 52%76$ 5.8%117$ 6.0%202$ 5.8%
No Change 630 6%39$ 2.9%57$ 2.9%103$ 3.0%
-0.01-5.00%2,223 23%1$ 0.1%(3)$ -0.1%3$ 0.1%
-5.01 - 10.00%8 0%(74)$ -5.6%(122)$ -6.3%(195)$ -5.6%
-10.00 - 15.00%1 0%(149)$ -11.3%(241)$ -12.5%(394)$ -11.3%
-15.01% +7 0%(187)$ -14.2%(301)$ -15.5%(493)$ -14.2%
9,751 100%
% EMV Value Range
# of
affected
Properties
Median $433,600 $600,000 $1,000,000
PriorLakeMN.gov
General Fund Reserve *
11
CFMP specifies a range between 40% and 50%
2025 Year-End Estimated Reserve Balance - $12.9M (54%)
2026 Year-End Estimated Reserve - $13.0M (51%)
* Estimated
PriorLakeMN.gov
City Financial Plan – Five Year
12
CITY PROPERTY TAX PROJECTION - INCLUDING PARK IMPROVEMENT BONDS
2025 2026 2027 2028 2029 2030
TAX LEVIES
General Fund Levy - Tax Capacity 14,848,732 16,238,411 17,660,526 19,264,383 20,425,810 21,695,077
General Fund Levy - Market Value 262,488 265,888 273,988 281,638 283,838 290,738
Debt Service Fund (not incl Park Improvement Bonds)2,929,190 3,031,056 3,648,002 4,037,676 4,211,165 4,077,930
Debt Levy (Park Improvement Bonds Only)470,838 1,766,767 1,903,484 3,197,954
CIP Funds 1,815,000 1,825,000 1,985,000 2,185,000 2,355,000 2,505,000
Total Tax Levies 19,855,410 21,360,355 24,038,354 27,535,464 29,179,297 31,766,698
Annual $ Change 1,859,077 1,504,945 2,677,998 3,497,111 1,643,832 2,587,401
TOTAL % CHANGE IN TAX LEVIES - including Park Imp Bonds 6.2%7.6%12.5%14.5%6.0%8.9%
CITY TAX CAPACITY TAX RATE- No Park Improvement Bonds 31.43%34.05%36.39%37.24%37.68%
Annual % Change 3.03%8.35%6.86%2.34%1.20%
CITY TAX CAPACITY TAX RATE- Including Park Improvement Bonds 31.43%34.78%39.04%39.99%42.15%
Annual % Change 3.03%10.67%12.26%2.44%5.38%
Debt per Capita - No Park Improvement Bonds 853 967 1,039 1,380 1,420 1,463
Debt per Capita - Including Park Improvement Bonds 853 1,143 1,734 2,231 2,763 2,937
Bonds Outstanding - No Park Improvement Bonds 24,145,000 27,510,000 29,725,000 39,650,000 41,080,000 42,620,000
Change in Bonds Outstanding 3,365,000 2,215,000 9,925,000 1,430,000 1,540,000
Bonds Outstanding - Including Park Improvement Bonds 24,145,000 32,510,000 49,615,000 64,100,000 79,960,000 85,580,000
Change in Bonds Outstanding 8,365,000 17,105,000 14,485,000 15,860,000 5,620,000
Five Year Planning Period
PriorLakeMN.gov
Seven County Metro Area Average Tax
Capacity Rate
13
City Levy/Tax Capacity = Tax Rate
PriorLakeMN.gov
•City Levy/Tax Capacity = Tax Rate
•2026 Prior Lake City Tax Rate estimate
based on preliminary 2026 budget is
31.43%
14
Scott County Tax Capacity Rate by City
City 2024 2025
Belle Plaine 88.96%93.46%
Credit River 17.10%15.76%
Elko New Market 46.25%46.80%
Jordan 57.23%56.79%
New Prague 42.43%44.88%
Prior Lake 30.30%30.50%
Savage 37.61%40.53%
Shakopee 27.40%27.77%
PriorLakeMN.gov
Future Challenges
15
General Fund:
•Funding for additional staff to maintain city services
•Unfunded mandates
•Reduction in the rate of development
•Wages/Healthcare and commodities – Market conditions and inflation impacts
Capital Project Funding:
•Funding for pavement management plan
•Funding for Master Park Plan
•Funding for future facility improvements, including Maintenance Center expansion in 2032
•Exposure for limited ability to assess for street projects
PriorLakeMN.gov
Fee Schedule Proposed Changes
(preliminary)
16
Utility Billing – rate changes
Increase in rate for Police contracted services due to salary increase from comp
study
PriorLakeMN.gov
2026 Tax
Levy and
Budget
Schedule
17
May/June/July – Personnel Plan, 10-year
Financial Plan, CIP Plan
July 23 – Preliminary Budget/Tax Levy
Discussion/CIP Debt Impacts – 2026 only
August 26– Budget Work Session, if needed
September 23 - Public Budget Meeting/Adopt
Preliminary Tax Levy and Budget
Nov. 11 – Budget Work Session
Dec. 9 – Public Budget Meeting/Adopt Final Tax
Levy and Budget
Next Steps
PriorLakeMN.gov
Council Discussion
18
•Council direction on proposed tax levies