Board of Commissioners - Regular Meeting

Right? Yes.

Can you put it aside?

That's what I was yesterday. Thanks. Thank you. No, no, no.

It's been a little while coming forward.

White check, test, one, two. Yes, definitely.

Yeah, I know. Do you like spices? Okay, now I feel like I'm...

It's important.

So let me remember. I think it's good. I think it's good. I think it's good. I think it's good. I think it's good. I think it's good.

My check, test one, two. My check, level check, one, two.

One, two, three, four.

Only, like, maybe two people.

And, like, three were, like, eight. And then, like, half of them were curious. That's why I said you wanted to talk to them. And they're amazing. They're awesome. They're awesome. They're awesome. Thank you.

Thank you.

Thank you. You can push this up or down. So if you want to put it up and then put it back down. Yeah. I think it went well. Yeah. I didn't feel attacked. But it was also their first language. Oh, sure. Yeah. All right. All right. Thank you.

Yeah, I mean, they went to China.

Yes. Yes. Yes. Thank you. Yeah. Yeah. Yeah. Yeah. Thank you. Thank you.

It's a great thing. Thank you.

Good morning. I'm going to call to order the Dakota County Board of Commissioners meeting for September 22nd, 2026. Please rise as you're able and join us in the Pledge of Allegiance. Thank you. We will note a quorum is present and no members are absent this morning. Next order of business is we will go out to the audience. Generally, our audience call for the beginning of the meeting is for items that are not on the agenda or that Consent agenda today. We are expanding that to the full agenda So if you're here to talk about items on the regular agenda You would come up at this time to address the board we'll keep it everybody together with board comments Which also means that after our regular agenda? We will not be taking more comments So at this time, I've got two people signed up. It's not limited to that, but we will start with our list. We also received one comment electronically, and I will note that for the board. First up is John Gutzman. Welcome. You can introduce yourself for the record, and you have five minutes in front of the board.

Thank you. I'm John Gutzman. I'm an Eagan. homeowner for the last 18 years. Historians remind us that to govern is to choose, and today we face a difficult choice. And I do stand in support of the county manager's budget recommendation scenario, too. I also want to thank our finance team and elected commissioners for having the courage to make these tough decisions to keep our county running. As the comparative data prove, Dakota County continues to have the lowest property tax rate in the 3.7 million populated metro area. And I know it's been a source of pride for the county for many years. People who may criticize this budget may rightfully care about their rising costs, yet some of that outrage is selective. According to the federal data, the trade policies, the sweeping tariffs, including on Canada and Europe, have acted as a direct tax on citizens, costing upwards of $2,500 per family. It takes a special kind of stable genius to pick a fight with Canada. Additionally, the geopolitical instability in the Middle East is now driving diesel to over $6.49 a gallon. And we haven't even faced those costs in our home pocketbook. So some folks kind of will tolerate those costs without a peep. When you are doing the really hard, transparent work of local democracy. So if we can bear the weight of those macro frictions, we can certainly choose this very tough decision that you've made to keep this county the best run in the state. Thank you.

Thank you. Next, Debbie Donahoe. Oops.

I'd like to bring up that Dakota County salaries in 2025 were 7% higher than the median, and the median was 30% higher than the U.S. median salary from 2024 to 2025. And if we're going to raise any property taxes, I think that I would like to bring up that property taxes are unlawful to begin with in the Constitution of the United States and in the Minnesota Constitution, Article I, Section 15. And so to put this on the people is a travesty against our Constitution.

Thank you. Thank you. Is there anyone else who wishes to address the board at this time on an item that's on the agenda, consent agenda, or not on the agenda? Hearing no one, we will move on to our next item, and that is to get an approval of the agenda. Are there any changes or a motion to approve?

Move to approve, Madam Chair.

Is there any – we need a motion to – Oh, amend?

Amend. Yes. With the motion to amend – and where is that? Where is that located?

We are adding one item to the regular agenda, which is an RBA that staff put forward. And, Heidi, do you want to explain it quickly before we move it?

yes madam chair commissioners uh item dc 60 30 is a walk-on item authorization to amend the 2026 budget and execute a transfer of up to 11 million 893 586 dollars from the employee services reserve fund to the general fund board you will remember that we discussed this at the budget workshop work session last tuesday

Yes. And Madam Chair, I believe it's item 11.2. And add that to the agenda, please.

And I maybe would request that we make a motion to add it before.

I would do that, Madam Chair.

Our first regular item. So we'll have to renumber. I'm looking to staff. We can renumber. So we will make the motion to add that RBA item to our regular agenda before item 11.1 and renumber as appropriate. That should be your motion, I believe. Okay. You said it. That's good. okay so we have a complicated motion and second but I'm looking to staff and I'm no one's concerned we did it right it's gonna be my assumption that said let us vote with a roll call Jenny

Commissioner Workman? Yes. Commissioner Atkins? Yes. Commissioner Holberg? Yes. Commissioner Halverson? Yes. Commissioner Droste? Yes. Commissioner Heyman-Roland? Yes. Commissioner Slavitt? Yes. Excellent.

So our agenda is approved as amended. Thank you. Next up, we are moving to our public hearing. It's a public hearing to receive comments and approve Dakota County Program Year 2025 Consolidated Annual Performance and Evaluation Report. Emily Anderson from Community Development is here to give us that report.

Thank you, Madam Chair.

Which way do I point this? I think so.

Oh, there we go. Perfect. OK. Good morning. So I'm here to present on our CAPER, which is a Consolidated Annual Performance and Evaluation Report. It's our year end report that details how federal entitlement grants were spent in the previous program year. which started on July 1 and ends the following June 30. The federal grants that we are discussing today are the Community Development Block Grant, the Home Investment Partnerships Grant, and the Emergency Solutions Grant. The CAPER must be submitted to HUD 90 days after the program year, which for Dakota County is September 28.

Oh, OK. I see now. All right.

In order to receive federal funds for the CDBG home and ESG programs, HUD requires the county to adopt a five-year consolidated plan, which is a strategic plan, hold an annual public hearing, and adopt a one-year action plan. And we have to hold a public hearing and provide the annual caper. These are our seven priority areas that were listed in Dakota County's 2025 through 2029 consolidated plan. The entitlement funding that the county received for program year 2025, shown on the bar chart, was spent on activities that supported the seven priorities. Not all of the 2025 funds are spent in the year. Some of these projects take a couple of years to complete and use funding from various years. Going through the priorities, under reducing homelessness, the county assisted eight homeless individuals with the emergency solution grant funds for rapid rehousing and one household for homelessness prevention. The funding went towards rental assistance, damage deposit, and first month's rent. The county also assisted 227 people with emergency shelter. The consolidated plan had two priorities to support affordable housing. Activities that support affordable homeowner housing include the CDA's homeowner rehab program, which rehabs 65 homes in Dakota County. The photos on the left show the before and after for one of these homes. The home program supported one new construction Twin Cities Habitat for Humanity home in South St. Paul and the rehabilitation of eight Section 18 homes throughout Dakota County. Home funds were also used for Denmark Trail, a 40-unit townhome rental development targeted towards workforce families in Farmington.

No, too fast.

OK. Over the last year, the cities and the counties spent $227,444 of CDBG entitlement funds on public services that focused on seniors or low-income youth. Sorry. Okay. The primary activities in the neighborhood revitalization priority are the well sealing and septic repair programs run through county environmental services, and the Hastings assessment abatement program run with the City of Hastings. This year, three obsolete wells were filled, two septic repairs occurred, and 10 low and moderate income households in Hastings received full assessment abatement. The public hearing notice and public comment period notice were published on September 4th in the Star Tribune. The draft CAPER was also available on the CDA's website, so anyone from the public could review it and comment on it. We have not received any public comments about last year's activities. And with that, Madam Chair, we are asking that you hold the public hearing on the 2025 CAPER and authorize its submittal to HUD. And I'm happy to stand for any questions if there are any.

Thank you very much is are there questions from the board before open public hearing. Hearing none I will now open the public hearing to receive comments and approve about the program year 2025 of the consolidated annual performance and evaluation report. If there are any public comments please come forward. Any public comments please come forward. And I will call a third time, as is tradition. Any public comments, please come forward. Hearing none, I will go forward and close the public hearing. And members, if there are any questions, you may address them now, or we can entertain a motion to approve our action for the hearing.

Madam Chair, I have no questions, but I would move approval of the resolution.

And I will second. We have a motion. We have a second. Is there a, and you don't have questions, you said? Okay. Any discussion to the motion? Hearing none, we can take a roll.

Commissioner Atkins?

Yes.

Commissioner Holberg? Yes. Commissioner Halverson? Yes. Commissioner Droste? Yes. Commissioner Heyman-Roland? Yes. Commissioner Slavik? Yes. Commissioner Workman?

Yes. Very good. And that motion prevails. Thank you so much, Emily. Next up, we have approval of our consent agenda. So moved. We have a motion. Is there a second?

Second. Second, Madam Chair. There's a second.

Okay. There's a motion and a second. Any discussion to the motion? Hearing none, we may take the roll.

Commissioner Holberg?

Yes.

Commissioner Halverson? Yes. Commissioner Droste? Yes. Commissioner Heyman-Roland? Yes. Commissioner Slavitt?

Yes, with the exception of 10.3.

Commissioner Workman? Yes. Commissioner Atkins? Yes.

That motion prevails. Next up, we move to our regular agenda, and we have our RBA to approve the dollar transfer. Will, would you like to address that?

Sure thing. Good morning, Madam Chair and commissioners. The first item we are bringing forward this morning is a request for authorization to amend the 2026 budget and execute a transfer of up to $11,893,586 from the employee services reserve fund to the general fund. So this next slide just goes into a bit of background, which we touched on last week at our finance work session, but I'll reiterate here briefly. Over the past roughly 12 months staff have been reporting on decrease in general fund unassigned fund balance regularly to the board Staff have been working on developing structural solutions to address the deterioration in fund balance and that will be presented as part of the county managers recommended 2027 budget In June, the board reviewed and approved an updated fund balance policy which commits the board to replenishing fund balance with several milestones along the way, first restoring to a 20% fund balance level before eventually restoring to a 35% fund balance level in accordance with the Office of the State Auditor's recommendations. In August, on August 12th, the county was notified by S&P Global Ratings that credit watch had been placed on the county with negative implications. The reason that was cited in that credit watch was the deterioration of general fund fund balance. Staff, members of the board, the county manager have since met with S&P Global Ratings. We've also had several meetings with our municipal advisor, Ehlers. And while we have informed S&P about the structural proposals to fix general fund unassigned fund balance. We also worked with Ehlers to explore some potential one-time options to boost fund balance at the end of 2026. So that is what we are here today recommending is a proposal to move some one-time funds from one of our internal service funds to the general fund. So just looking at where things are currently projected to be prior to this transfer, these numbers are projections based on Q2 actuals. We are currently projecting unassigned fund balance to be just over $6 million at the end of 2026. As a percentage of the projected $339.7 million in expenditures, that is 1.8%. And that is well below the thresholds established by the board in the county's fund balance policy. So just to recap on what the Employee Services Reserve Fund is, it's an internal service fund and it's essentially there to record the liability for long-term other post-employment benefit costs and compensated absences and then hold cash to balance against those liabilities. As of today, that fund has excess unrestricted net position, meaning that there is more cash in the fund then it's necessary to pay off all future liabilities and obligations. If a transfer is moved forward, that fund will continue to hold the liability for those compensated absences and OPEB liabilities, and we will continue to hold cash in that fund. So this proposed transfer amount is made up of two pieces. The first one, as I mentioned, is that excess unrestricted net position. The second portion is unreimbursed general fund compensated absences costs that have been incurred in the past three years. And those two amounts add up to the just under $11.9 million amount requested this morning. As you can see here, this chart shows the impact on general fund unassigned fund balance as a result of this transfer. It would increase fund balance from just over $6 million projected at the end of this year to just under $18 million at the end of 2026, raising unassigned fund balance as a percentage of general fund expenditures from 1.8% to 5.3%. So just to be clear on what this transfer will do, it is increasing general fund fund balance. It increases our fund balance as a percentage of expenditures. And it still leaves the county able to meet its compensated absences and OPEB liabilities as they come due. What this transfer does not accomplish is it does not resolve the structural imbalance in the general fund that will be proposed as part of the county manager's recommended budget. It also does not restore unassigned fund balance to the minimum established by county policy 2003. And it does not change the overall government-wide position because our internal services funds are consolidated into our governmental activities at year end. So again, just to reiterate the requested action here this morning, staff are requesting amending the 2026 budget and authorizing the execution of a transfer of up to $11,893,586 from the Employee Services Reserve Fund to the general fund. Following approval, I will return, or the county manager will return, to present to the board what the final transfer amount was based on 2026 actual performance as part of year-end reporting. With that, I'll stand for any questions.

Thank you, Will. Members of the board, questions? Commissioner Holberg.

Thank you, Madam Chair. So when we had this conversation yesterday regarding putting this action on the agenda and discussions that you and I had about what you as an accounting professional would be comfortable with in moving today as far as, you know, a first step or a opportunity to the board to show their commitment to building fund balance. You stated that you probably would not support the entire amount that was presented to the board last week, being a good, cautious accounting professional. that you are, so for the record, what do you see as the minimum amount? I mean, we have an up-to amount, but if people are looking at this and kind of want to know what for sure is already there, that as of today, recognizing that things could change, I mean, at least that first half of it's already there, so what's the neighborhood of what we're looking at that you are confident we will be able to transfer?

Thank you, Commissioner Holberg. So if this action is approved, our first step would be to execute a transfer of that $6.5 million of excess unrestricted net position that's currently sitting in the fund. we would then wait till closer to year-end to see what performance is looking like both in the general fund and in terms of the Liability that our actuaries determine we need to record both open compensated absences before making a determination of How much of that additional five point three million dollars to transfer and we would come back and report to the board How much we eventually do transfer?

All right. Thank you.

I appreciate your help Thank you other comments questions

Actually, Madam Chair, with that answer, I'm comfortable. I'd make the motion unless other people have questions or concerns about it.

have a motion is there a second okay we have a motion we have a second discussion to the motion i have one uh additional uh point of clarification and that is um uh you you talked about the uh reporting uh back to the board um can you uh just talk a little bit about the accounting standards um that you are going to be using to ensure that we do not end up using money that puts us in another hole and I know that they exist and would love to hear how we are going to prevent creating a hole with this transfer.

Yeah Thank You madam chair So the standards that govern the reporting that we have and how we record the liability within this fund or Gatsby 75 and Gatsby 101 Gatsby 75 is for other post-employment benefits Gatsby 101 is compensated absences Both those standards and state statute require that we record the liability. So we're presenting to the public that we have this liability because of the paid leave that we provide staff or the post-employment benefits that we provide retirees. We are not obligated to hold cash to balance against those liabilities. That said, and as Commissioner Holbrook was alluding to, it is a good practice to do that. You want to make sure that you have sufficient assets on hand to pay any liabilities that could potentially come due. So when we're exploring how much we eventually want to transfer, we're going to be balancing what are the needs of the general fund right now versus over the long term. What do we think this fund needs to ensure that we're not putting ourselves in a position where we have a large unfunded liability going forward?

Okay. Thank you. And GASB is?

Oh, apologies. GASB stands for Government Accounting Standards Board. It is the body that issues statements that provide oversight for government accounting.

Excellent. Thank you for clarifying that. Any other discussion? Hearing none, we can take the roll on the motions.

Commissioner Halverson? Yes. Commissioner Duroste? Yes. Commissioner Heyman-Roland? Yes. Commissioner Slabitt? Yes. Commissioner Workman? Yes. Commissioner Atkins? Yes. Commissioner Holberg?

Yes. And that motion prevails. Thank you so much, Bill. Next on our agenda is the approval of the adoption of our Dakota County maximum proposed levy. And I will turn this one over to Will as well.

Thank you, Madam Chair and Commissioners. The next item on our list this morning is the adoption of the 2027 Certified Dakota County Maximum Proposed Property Tax Levy. So this first slide just has the agenda for this presentation. I'm just going to start by running through a recap before we go into many of the slides that you've seen in previous finance work sessions before looking at a long-term general fund, fund balance and levy forecast, looking at some county comparisons, property tax impacts to different property classifications in the county before reiterating the recommended action and turning it over to the board for discussion. So this lays out kind of the process that we've taken to get here. And I didn't even include some of the things that we started working on last year. So we have really been working on the 2027 budget and determining the 2027 property tax levy in earnest for about eight months. We had our first finance work session in February. We've had several property tax and budget open houses along the way where we've engaged the community and gotten direct feedback from residents. And we are here today to recommend a 2027 maximum levy. So this is just a recap of the scenarios that have been presented to the board previously. And this encompasses the recommendations that were brought forward starting at the July 13th workshop. Those are obviously narrowed down over time, but we are bringing them all back forward here today. reiterating that it is the county manager recommendation to increase the property tax levy for 2027 by 18.7%, which will have approximately $143 per year impact on the median value home, which in 2027 is estimated to be $392,100. To balance the budget, we are planning to reduce expenditures by approximately $10 million, which will result in net FTE reductions of approximately 23, because this budget also will incorporate staff that were added to E&EA to deal with employment and economic assistance, to deal with the impacts of HR1 on Medicaid and SNAP eligibility. So here is the recommended 2027 levy. Our 2026 adopted levy was $184,246,066. An 18.7% levy increase will increase the levy by $34,454,014 for a total recommended maximum levy of $218,780. So I just want to also be clear about what is in this proposed max levy. This current recommended levy increase of 18.7% does not include a direct allocation of levy to replenish reserves. If the board chooses to allocate levy directly to reserves, the recommendation is to increase the levy above 18.7%. And as a reminder, each 1% levy increase raises revenue by $1.84 million. This table here summarizes the components that make up the levy increase, and this is just a reformatting of similar data you've seen in previous finance work sessions. Under the category of operational inflation, that includes things like personnel cost increases, salaries and benefits, increases to existing mandates, so things that we are required by law to provide, and then anticipated contractual increases for things like software, other enterprise wide agreements. The next item on the list is the structural deficit elimination, which we've talked quite a bit about We are changing our budgeting methodology where we are eliminating the 4% vacancy savings target in an effort to accrue any future vacancy savings to fund balance We are eliminating our operating budget deficit and we are back filling programs that were funded by ARPA the American Rescue Plan Act It also includes roughly a 4% levy increase to deal with state and federal cost shifts and new mandates. And those are included on a subsequent slide. And then to balance against that, we have $10 million of expenditure reductions that we will be enacting. So as I mentioned, this chart, which you've seen before, just highlights all of the anticipated state and federal cost shifts and new mandates that are coming online between 2027 and 2029. In total, in 2027, the estimated cost of these is $7.3 million, and we anticipate more costs coming online in 28 and 29. You've seen this chart before as well. This is the total unassigned general fund fund balance by year. And this goes back to 2008 and includes the 2026 forecast. So as you can see, again, prior to the authorization of the transfer that the board approved, we were anticipating $6 million in unassigned fund balance left in reserves at the end of 2026. This general fund forecast then is looking at that fund balance and is taking into account an 18.7% levy increase, removing that 4% savings target. That blue line now will be moved up because the board has authorized a transfer, so that number will be higher than what's presented here. And then the green and red lines just show, once that transfer is executed, the time it will take based on anticipated salary savings accruing to fund balance to return to both a 20% and then a 35% fund balance as a percentage of expenditures. This next slide is a five-year levy forecast. So this forecast is taking the elements that I showed on the previous slide with the state and federal cuts and cost shifts and also factoring in anticipated operational inflation in future years and then anticipated debt service needs to pay for capital projects that are in the 2027 to 2031 recommended or proposed CIP. Just for a brief county comparison, this data will be stale probably as soon as today. But this slide just compares 2026's percentage levy increases to the 2027 preliminary levy increases based on the data that we had at the time of preparation for this presentation. The next few slides walk through the property tax impacts. This chart here just goes through the median residential home, the agricultural per acre cost, and then midsize commercial and midsize apartment median value properties and the anticipated impact of this 18.7% levy increase on those properties. The next few slides then walk through by city and township based on the median estimated market value within that city and township. It includes also the percentage change in the value from 26 to 27 and then estimates what the 18.7% levy increase will do on that median value home. This next slide then, as I mentioned, just breaks down the townships. And then the final property tax impact slide looks then by property value. So within a residential home going from $200,000 up to $1 million. Commercial industrial going from $500,000 to a $10 million property. And then in apartments, same thing, from $500,000 to $10 million. So in summary, again, the recommended action before you today is to adopt the 2027 Certified Dakota County Maximum Proposed Property Tax Levy of $218,780,000 for 2027. And then I just wanted to highlight a few upcoming board dates as we move forward through the budget process. On October 6th, staff will be back here to release the Draft Capital Improvement Program Plan for 2027 through 2031. Budget and property tax open house and a public hearing on December 1st and then on December 15th We will present to the board for the adoption of the 2027 budget and property tax levy And with that I will turn it over to the board for any questions Commissioner

Thank you, Madam Chair, and I'm not sure who can answer this, but on slide eight, it outlines various unfunded mandates and challenges that have really you know, made a big impact on this budget process. My understanding is that there was a federal court ruling on Friday on the SNAP administrative eligibility and benefit costs, and I'm wondering which line items that would likely impact both of them or just the We have two line items giving a benefit share and administrative costs, and I'm just curious how that, if it stands, how that would impact us.

Thank you. Heidi has an answer. Madam Chair, Commissioners, I did look at that ruling. It's about the ruling actually says that it is illegal to kick people off of SNAP who were legal residents. So that doesn't change any of those line items. And then there's also a court case says that States cannot be held to pay a penalty for not meeting the deadline for doing the action, which now has been said is illegal. Sort of convoluted, but the bottom line is I don't think it affects anything from our – I think that the rest of the fees that we're – or the rest of the budget that we're going to need to meet the administrative cost still stands.

All right. Appreciate that. Thank you.

Thank you. Other comments? Commissioner Droste.

Madam Chair, if there's no comments, I'm ready to move motion. And I'll second it.

Okay. And your motion?

My motion, I'd like to make comments afterwards. But motion would be to propose 27 levy of 17% plus 1.5% for reserve or a total of 18.5%. And I'm comfortable seconding that, Madam Chair.

We have a motion. We have a second. Discussion to the motion. Did you have comments? Yes. Commissioner Dostey.

If I may, the primary reason, and this is painful after 24 years in public service, difficult budget. But I think the most important slide that you showed here is where our peer counties and across Minnesota They are all from excluding Olmstead, 7.15% to 8.5%. And they have the same federal state transfers, the same inflation, but there's one thing that's different, and that's because we have no fund balance, more or less, left after spending it down, especially the last decade. So when you look at this, we as a board, we cannot manage our budget without that fund reserve, where most counties, they're using fund reserve to keep it somewhat stable throughout this period. And each year, we'll be arguing with our state and federal legislators about passing costs down to us. But because of spending our fund balance down, it was good policy 10 years ago. I think it was over $130-some million. It was far exceeded what the levy was at that time. However, we never stopped spending. And even in this budget, it's just over 8% just to – filled the holes that we created in deficit spending. So with that as a background, yes, this will probably get us up to approximately 20-some million fund balance, hopefully by the end of the year. And it still puts us in a hole of about 100-plus million that we need to fill, and we're trying to do that in the next approximately 10 years. So having said that, especially with S&P giving us a warning on August 12th and Credit Watch, we will probably be most likely downgraded the end of this month or early October. But the stability of the county budget I see is the number one issue. I also think 17%. It's still a significant increase when you look at the raw numbers. But until we get a reserve minimal, our current policy is 35%. It was 20. We have very little ability to manage a budget looking forward. With that, I have no other comments.

Thank you, Commissioner Droste. Other comments to the motion?

Madam Chair. commissioner atkins thank you um so i'm i appreciate uh commissioner grassi's comments i believe this checks several boxes it helps restore the fund balance it presents devastating cuts there are cuts clearly there's going to be cuts within the county budget but it prevents the most devastating ones to public safety to our libraries to public health to mental health resources to homelessness prevention And then I want to tell a story that I shared with all of you, which came from a fellow named Jerry, who lives in West St. Paul, who chewed me out. And by the way, I've been keeping track. I've had 1,151 people contact me, and I appreciate that very much. I also appreciate all the work that's gone into getting us to this day, from Will, from Heidi, from all of the folks on the staff that have contributed to bringing this information to us. But Jerry had a great day. He came to our first budget hearing. And he came, I could see him from across the room. He came zooming over towards me. And I represent West St. Paul, as you all know, West St. Paul, South St. Paul, Invergrove. And he came up after seeing some of the boards and so forth, and he said, all right, so I've seen all these numbers. What's the actual impact? You know, because I've seen it, you know, at 16 or 18 or 20%. Tell me what the impact is on my house. And he goes, on the overall tax bill. And I said, at the time, we didn't have it narrowed down like we do with the motion that Bill made. And I said, well, at some place, you know, I live in West St. Paul, it's going to be someplace between about 2.5 and 3.5%. And he did, you know, when a dog hears a funny sound, he did kind of this cocking of his head, and he goes... well, why the hell didn't you say that to begin with? He goes, why did I drive all the way down here over 2.5%? And it's what people don't realize sometimes is that the county share of our overall tax bill is a very modest amount. And so when you do it on the overall tax bill, Now, in the townships, it's more significant, but the townships get additional services. The sheriff's department, I was just talking with Sheriff Lico, it's 355 patrol miles, square miles in the townships. So for them, it's a little bit heavier. But South St. Paul, West St. Paul, this number isn't even above 3%. It's about 2.7% or 2.8%. And so he goes, well, just make sure, he goes, I came all the way down because I read in your newsletter 16 or 18 or 20%. Make sure if you ever talk about this again, you talk about the overall impact. And actually for folks sitting at home and trying to calculate what this means, a rule of thumb is just take 3% of what your overall tax bill is. And that's about what this amounts to. In South St. Paul, West St. Paul, it's a little less. A couple other cities, a tiny bit more. But it does, like I said at the outset, it checks all of the boxes. It was like threading a very tiny needle to deal with the federal cuts, the state mandates that came without additional funding, and all the other issues that we're facing right now. And I think this does it. And, Commissioner Grassi, I appreciate you making the motion. I expect to support it.

Thank you. Other comments?

Yep. Oh, Commissioner Workman. Thank you. So I'm shooting from the hip here. I have nothing prepared. But it's just that never have I ever in my entire political career voted for a double-digit increase. And if you could understand the pit in my gut right now, I'm trying to get past that. So if you're going to ask me to do, to vote for that, I absolutely need guarantees that excess amounts will be going straight into the reserve fund balance. And I don't want to just be told that because I've heard this during our whole process. I need it memorialized. So that something like this doesn't ever occur. Because this is temporary. I keep thinking we're in a really tough temporary situation and we're going to get out of this because we can. But that is my one, you know, fall on the sword thing. I need it memorialized. So that's my comments. Thank you, Madam Chair.

Thank you. Other comments? Commissioner Slavik looked like you wanted to say something.

I guess I will. Thank you, Madam Chair. I think that as we've seen across, I think Commissioner Droste makes the point of what has been happening across all counties. I think You know, it's not just the new programs and the of state and federal shifts and mandates, but it's also the existing shifts and mandates that have inflationary increases that we are still expected to do as counties that as we look through this budget, what was not mandatory and determining if those should be where we make those cuts. That was a lot of what we're doing. Much of that. from parks to libraries to some social services to veterans and drug courts, they're all still part of what are actually the non-mandated things that we have to do. But I think that the first and foremost, what we heard was right in the financial ship of this organization. We are the third lowest tax rate of all 87 counties. So we've been very fortunate with a growing economy and with a lean organization that we've been able to go in and uh keep our tax rate lower so for a four hundred thousand dollar house in dakota county versus a four hundred thousand dollar house in traverse county you're talking almost five times more county taxes in real dollars than you are in dakota county for the exact same just just the way it is because of a growing economy because of the way we've been able to do things in our overall capacity that we've been able to be, of a large county, we are the lowest tax rate. I think we would realistically, even with the number we're discussing today, still maintain one of the lowest tax rates, if not the lowest tax rate of a large county for that part in there. But the biggest difference on here, and literally over 50% of what we're talking about in a levy increase, is righting the financial ship of this organization. It is the fact that we've been able to have the success of our tax rate and that for so many years because of some of the decisions that were made in the past. And what needs to happen now is to be able to make the very difficult choice to be able to put us into the right financial situation. It's going to take a few years, but by doing a move like we're discussing today, it accelerates that to be able to put this organization on the right track sooner than later.

Thank you. Other comments? Commissioner Hayman-Roland.

Thank you, Madam Chair. I really appreciate everyone that has given input into this process. The transparency, County Manager Welsh has been the best that I've seen. And Will, the work that you've done is exemplary. This is a hard decision. This is something that really has taken a lot of thought, but we want Dakota County to be the Dakota County that we've always come to love and to know that has always been so good at being able to provide the services that are necessary for our residents. And so in that deliberate decision to fund at the level of the county manager's recommendation, We are doing that and we are deciding deliberately that our future will be at least as good, if not better, because we made this decision today. So I want to thank Commissioner Droste and thank Commissioner Atkins for making the motion and for this board to understand the importance that today collectively we will deliberately continue to make Dakota County one of the best places to live in this state.

Anything else from the I will just add to the comments briefly. Looking at these budget scenarios and looking at what we've been facing, there's a few things that I think have been really positive. First and foremost, I think, has been the transparency. The board has been very committed to transparency. Staff have been very committed to transparency through doing outreach to employees immediately with town hall discussions, getting out there and answering questions to the people who are making Dakota County what it is day to day, to meeting with the public where people are. It's very easy in government to hide behind the complexity of our systems. And sometimes what folks say when they're explaining things doesn't super duper sound like English when it comes out. I often think that's deliberate. I think the question of how does this affect me? How does this affect my neighbors? How does this affect things that I count on? How does this change the Dakota County that I know today? And having that conversation with the public, having that conversation with the employees of this county, I was overwhelmed and frankly surprised. We've all been serving in government on this board for a very long time. The appreciation for the county, the appreciation for the county employees, and the appreciation for the value of services that I heard from the public was overwhelming to me. It definitely was the majority of comments that I personally heard from my constituents. And boy, did that do my heart good. Because I've had a lot of pride sitting on this rostrum and representing my communities and supporting the visions that the impressive professionals of this county have brought to us. Do you know what we can do to improve native species in California? Do you know what we can do to help support our park utilization? Do you know what we can do to improve the services, not only of folks who want to learn more in our libraries, but folks who may be experiencing some challenging times? And making sure that people have access to life-saving medication and homelessness services, places where people gather. The county has stepped up to provide that. And even people who don't use those services say, let's keep doing it. So my priority going in was to preserve the things that make Dakota County Dakota County. Over the weekend, lots of math was getting done and really appreciate the willingness of staff. And I know different board members were probably having different conversations. I was having different conversations all weekend. and running through scenarios. How are we going to save what we have? And I think that this proposal gets us there. We have been very clear, I have been very clear that we need to continue money management because we've taken the big swing on saving what needs to be saved, but I think before the end of the year, we are going to be able to manage our dollars in a way that are going to continue to preserve our future. And that is my priority and my request. And I think the work that this board has done to be transparent and thoughtful is... important. And I think we all agree we never want to be in this position again. So long-term stability is vitally important in all of the actions that we are taking today. And that's what I will say.

Heidi. Madam Chair, the attorney has asked me to just restate the motion for clarity. Very good. The motion on the table is for a 17% increase to the 2026 levy for operations equal to $31,321,831, an additional 1.5 increase to the 2026 levy, for reserves in the amount of $2,763,691 for a total increase from the 2026 levy of 18.5%, an amount of $34,085,520. That's the increase, which would bring the 2027 max levy amount to $218,331,588. And with all unspent 2026 budget directed into reserves. Speaking to Commissioner Workman's thought. Thank you.

That's the motion. It's guaranteed. It's guaranteed.

Okay. Thank you for restating that. I have a question about the addendum about all additional dollars going into reserves because we've had a lot of conversations, you and I, about saving programs like youth homelessness prevention and library services and other staff. So I want to be sure that as we talk about money management that It is. that we are not going to sacrifice positions for that, as we've discussed.

Madam Chair, Commissioners, I believe that what Commissioner Workman is talking about is all of the money that might be unspent at the end of the year, for example, are holding open of positions during the year. We have held open more than 100 positions for months. All of that savings will accrue to reserves.

Madam Chair. Commissioner Workman. I would include any account that we have if there's excess at the end of the year goes into the reserve fund balance. Any account.

Commissioner Joste, it's your motion, and so that was an amendment to your motion. I will say I really am concerned about locking us in too much because we are trying to balance a lot of things. I think we... are putting a lot toward the reserves, but my understanding was that we would be able to save programs and positions with this and i'd be afraid that i just want to be sure that we are not going to lose that hope by locking us in too much with money management madam chair commissioner workman thank you

i don't know how then you're going to say you're going to try and curb the spending commissioner drossi that was part of your opening statement and i don't hear that if there's not a commitment to filling up that reserve fund balance as quickly as possible so if there isn't going to be a some sort of acknowledgement or commitment to curb the spending then Then we have a problem. Commissioner Droste.

If I may, thank you, Madam Chair. The motion, we set max levy here. Max levy was 17. And thank you for calculating the actual number. And then 1.5 to fund balance, that's clear. Now, this would be another amendment subject to any other remaining balances in any fund was not part of the amendment. Right. I know what you're saying. But I'm assuming when we get to the end of the year, any remaining funds, we as a board would have a discussion specifically, whatever the fund is or et cetera, to that number. And it's getting away from all governments at max levy. It can go down. It just can't go up.

can i make one point and to address the county attorney because we just voted on when we move over those funds from the employment services reserve fund there is um a statute in here i asked you about the definition earlier about the needs of the current year and the funds being transferred over to any other county fund, from one county fund to another county fund. Can you just explain that a little bit, please? I'm sorry, Madam Chair.

Madam Chair, Commissioner, on what any other fund means?

We had a discussion when we decided to move funds over into the general fund, it was pursuant to a statute that was cited in our background. Does that still apply to what this discussion is?

Yes, that statute refers to any excess funds, any county fund, and the authority of the board to move those funds to other funds within the county. So pursuant to the statute, there is an authority. And then the action that was brought today was based on county policy, where there's thresholds on delegations to the county manager for moving certain dollar amounts. Larger dollar amounts require the county board to weigh in on where those funds can be shifted to.

So just point of clarification, if I may, Madam Chair, does this apply then to the conversation that we're having?

Yes, it applies depending on dollar amounts based on policies. Thank you.

So, it's guaranteed. And to the Chair's point of having a little anxiety about certain things, if there's an excess, it's going into the reserve fund balance.

Heidi. Madam Chair, yes, and that is how it generally works every year. There are, as our county attorney pointed out, levels of authority for spending. And at the end of the year, we've been pretty strict, actually, since I got here, pretty strict about what we allow to be spent and what gets put into reserves. To the point of Commissioner Halverson, Your discussion is really about what gets cut. We're still making cuts in this budget. It's still going to be $10 million, a little more than $10 million in cuts. And your comments are more to what exactly are the cuts, if that makes sense.

Correct. And then I guess my other question is, you know, I think Bill clarified it. what is the appropriate motion our job today is to spend is to set the max levy and commissioner drossi's motion does that i think that our work as a board continues um to uh you know finalize our budget by uh december 1st and i think that to commissioner workman's point the um Our policies around our reserves are part of that. And historically, that has been what the board work has done. So I just question the need for that additional motion. But others will have.

Well, I'll withdraw.

Okay.

My amendment.

Thank you. Commissioner Holberg. Thank you.

So just for clarity's sake, for the maker of the motion to just kind of I need clarity. So basically what your motion does is when you have all the little boxes of choices, you're plugging in 17 percent in the spending box. So it's not a reflection of the manager's recommendation, you're going to 17 percent in the spending box, and then 1.5% dedicated to the reserve. Plus 1.5% for simplicity. sake to just kind of get it down. So when the budget is being prepared by staff, they will be hitting that 17% threshold, and we will then have the opportunity within that 17% threshold to make modifications as we work between now and December, but unless there were some change to the one and a half supported by four members, that one and a half percent for reserve would stay, is that correct? Correct. All right. Well, I appreciate that. I probably, you know, I don't know where this, I'm assuming this is going to pass, but, you know, I just, I can't, when you add this on top of the wheelage tax, which is over $4 million, which equates to to about a 2.3% increase in spending. We're up over 20%. There's a lot of people hurting out there, particular people that are surviving on fixed incomes, whether it's Social Security or disability. This is a really big ask. I think it's too big. You know, I look forward to maybe there's some opportunities to make some reductions as we move towards December. But for today, I'll be a no-go. Madam Chair.

Commissioner Heyman-Roland.

Thank you, Madam Chair. I just want to make sure that We all know that this vote means that we're protecting people who are the most vulnerable people, who are on Social Security, who need the services that are mental health services, the social services, the housing services. I think that's really why we would even consider

um increasing our levy at this this rate so i just want to make sure that that statement is made and is very clear any other discussion hearing none sounds like we have um nine months of discussion we're here so with that let's um take the role jenny commissioner drasty yes

Commissioner Hayman-Roland?

Yes.

Commissioner Slavik? Yes. Commissioner Workman?

No.

Commissioner Atkins? Yes. Commissioner Holberg? No. Commissioner Halverson? Yes.

With that, the motion prevails. Thank you. Thank you, everybody, for their hard work. Next up, Interagency Reports, Association of Minnesota Counties, Commissioner Heeman-Rowland and others.

It was a busy week. And I'm going to pass this along to Commissioner Slavik so he can give a report out. Thank you. Commissioner Slavik.

Thank you, Madam Chair and Commissioner Heyman-Rowland. A couple things. First of all, we had a board meeting last week, which was a majority that was update on the upcoming policy conference, but also we received presentations from our elite and premier partners, those who help fund the organization and who are partners within county work, including a number of partners who Dakota County uses for services. Then we did have the policy conference. One thing that I, we were able to have both gubernatorial candidates come to the conference and speak. Commissioner Atkins was also there representing Dakota County. And I can certainly add in more on that part in there. One of the things that I do want to make note in here is This is the North Star vision. This was actually put together by the Board of Directors, given to both governor candidates, and it's really a direction of a future for the state and county government partnerships and relationships, and really trying to do a reform More and more, every year, more burden goes on to the property taxes as opposed to state government. The state and the feds have continued to put more pressure on this and that model is certainly under distress and it's coming to a breaking point. And what we were able to do is we created this document and were able to send that to both candidates for governor, both actually read it and cited it during the part in there. There's kind of a one-pager that went with this as well, but it really breaks down to some of the things such as the long-term service supports that are being shifted at the last minute to counties back in May, some of the things that we've been working with with SNAP and Medicaid, but also trying to find a different vision that I think some points in here is we've really had, we want to go, this partnership needs to look more from oversight and compliance to an actual partnership and problem solving. One size does not fit all. We need local flexibility in some of this part in here. And then these COPS just are unsustainable to property taxpayers. And how do we align the appropriate responsibilities and adequate resources that go with that? So this was, as I said, a lot of work by the board of directors to be able to get to this point here and has been noted by both campaigns as a um as a step in the right direction both campaigns actually have acknowledged that the relationship with counties has been strained due to uh what has been happening at the legislature over the last in essence five years but maybe more um but but particularly in the in recent years what has been doing there and um action needs to happen that's going to be far more dramatic than frankly, both acknowledged that either one of their own friends and parties, they were going to have to make tough decisions on that because that's kind of the real situation that we're in today. And so I only have one copy. I'll either pass it around or try to get more copies of that. But I think you all got it in an email as well. It was a very, very positive conference. I want to talk real quick on the priorities of general government, very broadly speaking, that we came up with was some property tax relief, data practice reform, and election support. There's a lot of special elections that are going to happen, have been happening, and those are on the cost of counties. They're not on the cost of cities or townships or the state. realizing that as we see more and more special elections that these are a direct unfunded mandate in what elections and what we do. So that's a little bit what we did in general government. Commissioner Atkins?

Thank you, Madam Chair. So I serve on the Public Safety Committee, and it kind of became a general government kind of meeting. Obviously, there was lots of talk about 9-1-1, next generation 9-1-1, but considerable amount of discussion along the same lines of what Commissioner Slavik talked about, which was lots of folks talking about mandates, lack of funding for those mandates. Very pleased to hear both Senator Klobuchar and Speaker Damuth, the two candidates for governor, both lean into understanding the unfunded mandate issue that we have been trying to deal with. I think Will told us a while back that we've got over 100 mandated programs that we carry out on behalf of the state. And we get about, at one time, it was 72 cents of every dollar the state actually provided, meaning local property tax folks got to make up the other 28. I think that's down to 66 cents that the state compensates for those required programs that we have to carry out. which means that's $0.34 of every dollar gets put onto our property taxpayers. But both Senator Klobuchar and Speaker Damuth talked a lot and leaned into the desire to not do unfunded mandates and just get passed along. That's the equivalent of a property tax increase. That's a lot of what we talked about today. So that's my report relative to AMC.

I did not go to the conference, but I did get a report back on health and human services. This has been a big target for the cost shifts, and so that was a large part of the discussion in health and human services committee that I serve on. In addition, modernization going forward is important. also a priority we had the first meeting of the modernization work council which is unique it was in statute that the legislature created a council that consists of the three agencies that were given money in order to help write the ship on our i.t modernization in human services and four seats for counties so the Equal voices at the table is something that we've worked on for a very long time I'm serving on that and then we there are three IT professionals from three other counties throughout the state That are part of that as well. We plan to start meeting monthly So we had our first meeting last week and we will continue to meet monthly to make plans and put pen to paper about what the changes are that we are going to make. And my commitment as the chair of that is that we are not going to admire the problem anymore. We are going to come forward with solutions and put the experts front and center. Those are the people that are working these systems every day in counties around the state. And I'm excited to see that work get started. That's my update. Other updates? Okay, good. Metropolitan Emergency Services Board.

So I had to leave a little early for another meeting. I'm going to let Commissioner Grassi carry that one.

We had a meeting September 9th, standard issue. We added a couple expansions to the network. Otherwise, nothing else to mention.

All right. Thank you so much. Minnesota Inter-County Association, MICA, we met two weeks ago.

Yes.

It goes so fast. Our board met with the co-chair of the tax committee, Aisha Gomez. Next month we are going to be meeting with the other co-chair of the House Tax Committee, Representative Greg Davids. Our conversation with Representative Gomez really focused on property tax relief and what ideas are going to be in the hopper to help property taxpayers around the state. My personal analysis, I'll put my own opinion on this, but when it came to modernization, we... We stopped asking and started telling, and I'm curious if that needs to be our approach with property tax reliefs. I'll just put it out there, and hopefully we'll be able to have some really productive conversations preparing for the next legislative session. Anything else from Micah?

Just one comment. Being new to the board, MICA has been around. We had cupcakes 55 years. I was somewhat surprised. But for the audience, MICA is the larger counties, primarily metro, but also includes Duluth, Homestead, St. Cloud, and represents 44% of the population within the state and they do tremendous amount of work voice from the metro counties especially in larger growing counties on working with legislature and providing great data for background just side comment and i did not have a cupcake neither did i but they were beautiful

Next up, Metropolitan Mosquito Control Commissioner Workman.

Joe would have ate that cupcake. We have an executive board meeting tomorrow and just a friendly PSA. I'm loving this cool weather out here. But the mosquitoes are still out there, so don't get too comfortable. They don't go away until after the first hard frost.

That's right. National Association of Counties. Nothing. Transportation Advisory Board Commissioner Holman.

Thank you, Madam Chair. We did not have a September meeting, but there are some updates on the issues that we've been working on with the Federal Transportation Commission. administration, there was a response to the Scott County letter regarding the community considerations and them being in conflict with the federal transportation funding standards. So it's my understanding there's some conversations there being had. And then Congressman Emmer introduced A bill, I don't have the exact press release, but something the local control bill which would undo the grandfathering of the unelected Met Council as the MPO for the Twin Cities. planning organization for the Twin Cities, so we're not sure what the ramifications of that are. It could be. provide a whole new range of challenges given how it would tilt the power structure to the largest city in the district under federal standards. So I think we're still trying to kind of figure out what that means some more later. And then I have an update under other as well.

Vermillion River Watershed Joint Powers Board.

We will meet next on Thursday.

Okay. And the Workforce Development Board.

Thank you. Thank you, Madam Chair. We said farewell to Mark Jacobs, and we welcome Dana DeMaster as our Executive Director of the Workforce Development Board.

Thank you. Good update. And other. Commissioner Holberg.

Thank you, Madam Chair. This relates to my position on the law library governing board. There has been a decision to close the Apple Valley satellite branch. We lost another employee, so it would be four employees in five years. The last three I'm going to just read. from the memo that we received that the daily stress of working alone in the front lines as a solo law librarian was not sustainable. And so they are going to consolidate down to just the Hastings location and we're only one of two counties in the whole state that had two locations. St. Louis, I believe, is the other county. And the state law requires that there be a law library in the county seat. And so the need for the consolidation and the choice of keeping Hastings open is that part of it is dictated by state law. And that's going to go into effect on November 1st. But in the meantime, we have just two staff members trying to cover both locations. So that's providing some challenge as well. So FYI.

Thank you. Any other updates from board members at this time? Hearing none, we can hear from the county manager.

Madam Chair, Commissioners, just one quick item today. Ahead of November 3rd, Election Day, I'm happy to report that elections are going smoothly. Absentee voting began on Friday and we mailed out over 17,000 ballots to folks who wanted those mailed out. We encourage everyone to get out and vote. And you can come to one of our three centers, the Administration Center here in Hastings, our Northern Service Center in West St. Paul, or our Western Service Center in Apple Valley, and vote absentee any time between now and the time of the election. Thank you for that update, and thanks to our election staff.

All right. With that, we can entertain.

Motion to adjourn.

Thank you. We have a motion and a second. Any discussion? Hearing none. All those in favor, aye. Aye. Any opposed? No. We are adjourned.

Thank you.