City Council - Regular Meeting

Call this meeting to order. Start with the Pledge of Allegiance.

I pledge allegiance to the flag of the United States of America and to the republic for which it stands, one nation, under God, indivisible, with liberty and justice for all.

Remain standing. We're going to do invocation by Harvest Community Church. They're not there, so roll call.

Sabres. Here. Goldhammer.

Here.

Davis.

Here.

McArdle.

Here.

Barrington. Here. Schlimgen.

Here.

Greenway.

Here.

Smith. Here.

Okay, we have a quorum. Approval of consent agenda items. I'd also like to add an executive session at the end of this agenda.

Motion to approve Schlimgen. Motion to approve.

Second, Mr. McCarroll. Further discussion? What do you want the audience to discuss? Anything on the consent agenda?

Anything to say, Sam?

Or are you just here?

I mean, I'll kind of introduce it.

Come on up and talk at the podium and state your name, please.

Hi, everyone. I'm Sam Nicholson. I'm the head men's basketball coach here at Dakota Westland. Fourth year in Mitchell, going into my second year as the head coach. But next Friday would be the 18th. We did it last year, and it's just using the parking lot on the north side of Bradley's there in between the Corn Palace. And it's a fan fest, right? reserve tables within Bradley's for families and things like that. But for the most part, last year was our first time. I'd say we had close to 300 people show up or walk by. And what was really cool to me is people within the community were walking by. They stopped by and they were just on the fence line. Right. And we bring a ton of free T-shirts and my kids sign autographs. It's very interactive fan fest. all of our players, both men's and women's teams, get on the microphone, introduce themselves, tell them where they're from. And last year, like I said, for year one, it was incredible. And we're trying a couple of different things to expand it this year and hopefully keep this growing for the community.

Thank you. Thanks. Anyone else in the audience to discuss the consent agenda? Okay, roll call.

Davis. Aye.

Aye.

Aye. Aye. Aye.

Aye. Aye. Aye. Okay, motion carries. Public comment. If you need to address the mayor and members of city council on an item that was not on the agenda, excluding personnel items, please come forward to the podium and state your name and your concern. Presentations are limited to three minutes. Items will be considered, but no action will be taken at this time. We have an excited crowd.

greetings i'm elizabeth with mitchell mainstream beyond and i just want to remind everyone oktoberfest is on september 19th it is going to be from 11 to 4. we have our traditional wiener dog races kicking off at one and then by request we have 35 pound and underdogs have their races after the wiener dogs it is incredible good time to just come watch and enjoy there will be other activities happening we'll have the cornhole tournament Nailed it because of trademark reasons. We call it a different thing, but that's where you take the hammer and hit the nail into the wood. And then we have a petting zoo that will be there. We will also have pumpkin throwing, stein holding, and all of our traditional Oktoberfest games. There will be also youth activities and adults separately. Then we are also partnered with the 301 Rods. They will be filling the street from first all the way to the Corn Palace that day. So I highly recommend checking out our Facebook event page to get all those details on how lineup works. There is a little bit of a pivot this year. They're going to be lining up at the Caldwell Park instead of North Main, just because of how this year worked out. We're still really happy about the partnership. We also have the... Fall Beverage Bash coming. We are opening that up for two categories. There's one for mixology, so that can be alcoholic or non-alcoholic. Kind of have some fun with it. And then there's going to be a coffee division as well, which has been a huge request since we started doing these rumbles. So it's supposed to be that Taste of Fall in Mitchell. Anyone is welcome to participate. You can find more information with Mitchell Mainstream and beyond or the Chamber of Commerce on that one. Ladies Day Out is October 3rd. There was 1,813 entries last year. We had some people that came up from Texas. I think that was just a whim that they entered, but it was really fun to call and ask them why they even signed up for the event. With that being said, our downtown trick-or-treat, there's a lot of other activities going on, but the downtown trick-or-treat, we've already been getting calls on that. We will be submitting a special event permit to close the road. from 5th to 2nd, business owners will still participate, still be that traditional downtown trick or treat, but we are gonna open it up for a trunk and treat down the middle with some of the other trunk events around town have dissolved, I think is the right word I wanna use. We're bringing that option down to Main Street so people can walk on the streets and down the middle without being ran over. So we will be putting in a road closure request And then Holiday Open House is that first weekend in November. And a lot of other events. But then December 1st is already Cradle Lights. And we already have a couple of sign-ups. So thank you all. And have a great time.

Thank you. Dave Sietsema, director at the Corn Palace. I just wanted to take the time tonight to thank the council, mayor, staff, volunteers, and the Corn Palace Entertainment Board for all the support during festivals. Say thank you to the Mitchell public and the regional public, really. We had a great festival, and none of it is possible without your guys' support and help wherever you are. You pitched in passing the word, sharing social media, all that. I just really want to say thank you. It takes a village. And I thought Mitchell turned out and had a great job, did a great job that week. So appreciate that. Corn Palace continues to be busy. We've got shooting sports this weekend. We've got Central Electric Banquet coming up. We've got Dakota Oyatahe Volleyball Challenge, the bull riding in October. We'll refinish the floor. We'll have the pheasant banquet. So things continue to, things are popping, I guess. I'll use the joke one more time, at the Corn Palace. So thank you all for your support.

Thank you. Anyone else like to address the audience?

I was trying to find Stephanie's email here, but I can't find it. But I'd like to give Dave a shout out on the Corn Palace being the number five attraction coming down the, I don't know if it's in the top 250, but it was ranked number five in whatever he sent us. I can't find what that was. I think being number five, not a bad thing for an attraction for people to come off the road to see.

Very nice.

Thank you.

Anything else? All right, here and then we're going to move on. Board of Adjustment, entertain a motion for the City Council to recess and sit as a Board of Adjustment. So moved. Mr. Goldhammer.

Second.

Second by Mr. Barrington. All those in favor of the motion, say aye. Aye. All those in favor of the motion, say aye. Motion carries. Action in hearing on application for Abiot Conditional Use Permit. Abiot has applied for Conditional Use Permit for 105C-3 Family Residential Daycare located at 1016 Westworth, legally described as shown on the agenda. Mr. Schrader.

Mr. Mayor, Council, Planning Commission motion to recommend approval with the three conditions, which is license is not transferable. If the business ceases to operate for six months, then a new application will be required and to pass a fire inspection. That was unanimously approved. It has passed the fire inspection. There were six letters in favor that accompanied this request, and I can answer any questions you have.

Thank you. Move to approve. Mr. Goldhammer. Second by Mr. Davis. Further discussion?

The motion includes three conditions, I'm sure.

Yes.

Yes. Perfect. Thank you.

Anyone in the audience like to discuss this? Okay. All those in favor of the motion, say aye. Aye. Both same sign. Motion carries. Action to set the date for the Board of Adjustment hearing 921-26. Move to set the date. Mr. Goldhammer. Second by Mr. McArdle. Further discussion? Anyone in the audience like to discuss this? All those in favor of the motion, say aye. Aye. Opposed, same sign. Motion carries. Reconvene a City Council and entertain a motion for the Board of Adjustment to adjourn and the City Council to reconvene in regular session.

Second.

Second by Mr. Barrington. Second by Mr. Schlimgen. All those in favor of the motion, say aye. Aye. Opposed, same sign. Motion carries. Authorize Mayor to complete transfer of property for First United Methodist Church, Mr. Johnson.

All right. Thank you, Mayor and City Council. I know that there were quite a few council members that are now on the board that weren't here in 2019, but the City Council did previously approve a purchase of this property in order to construct a public parking lot at this location. That purchase agreement with the church included the provision that they could exercise an option to repurchase that property after a certain number of years, the city did receive their exercise of that option. So now we're really just putting this in the minutes so that there's a record of how this transaction took place and authorizing the mayor to complete that transfer back to the church at this point.

Move to approve.

Mr. Goldhammer, seconded by Mr. Smith. Further discussion?

John, do you want to come up here and kind of explain a little bit to us?

Yes, I'd be happy to. John Klagich, and I'm one of the trustees. And I just want to say thank you. Thank you so much. This is an interesting thing with the chamber being involved and with the city being involved. And it worked out well. We started out with a really, really bad, bad apartment house next to us. Some of you that have been around could see that. So we made that a lot better. And so we're just very thankful. So thank you ever so kindly.

Is there going to be a private parking lot then, John? Yes.

Are you going to allow off? It's private, but we have the public coming into there. Okay. We are emphasizing having the public there, and we try not to have it overnight. That was another piece. For the church services, especially, on Sunday. Yeah, trying to be ready for them. Sounds good. Thank you. Thank you.

Anyone else in the audience? Okay. All those in favor of the motion, say aye. Aye. Opposed, same sign. Motion carries. Action to approve drinking water state water plan application with the Department of Agriculture and Natural Resources. Mr. Scherter.

Mr. Mayor, Council, the state water plan applications are renewed by the city every two years to keep the city eligible for state revolving loan funds or SRF through the Department of Agriculture and Natural Resources. The drinking water application comprised projects and a facilities plan for the water system prepared by SPN and Associates, which was completed in 2016. SPN is actively working on updating this plan, which is a 2026 budget item. Once complete, the new facilities plan will replace the 2016 plan. Staff recommends Council approval for application to the State Water Plan. and authorize the mayor to sign on their behalf. I can answer any questions you have. Thank you.

Move to approve.

Motion by Mr. Goldhammer. Second. Second by Mr. Schlinken. Further discussion? Anyone in the audience like to discuss this? All those in favor of the motion, say aye. Aye. Opposed, same sign. Motion carries. I can approve clean water state water plan application with the Department of

Agriculture and Natural Resources, Mr. Schroeder. Yep, Mr. Mayor, Council. Same thing, but on the sewer side. Currently, a sanitary sewer facilities plan by SPN Associates, which was completed in 2020. Again, SPN is actively working on updating that plan. Once complete, that plan will replace the 2020. The thing that's added into this portion is that Clean water loan applications are also eligible for non-point source funds, which assist in fire steel watershed enhancement efforts, such as the wetland project that was completed just upstream of the lake. Staff does recommend council approval and to authorize the mayor to sign on their behalf.

Thank you.

Does that answer any questions?

Motion by Mr. McArdle, second by Mr. Davis. Further discussion? Anyone in the audience like to discuss this? All those in favor of the motion, say aye. Aye. Opposed, same sign. Motion carries. Action to approve amendment number one to agreement A2024-43, South Wastewater Treatment Plan Phase 2, testing 2022-1 with Geotech Engineering. Mr. Schroeder.

Yep, Mr. Mayor, Council, this agreement is with Geotech Engineering and Testing Services. That was approved at the November 4th, 24 Council meeting. The agreement provided construction-based services for the South Wastewater Treatment Plan. Their services included earthwork excavation, observation, and testing. and American Concrete Institute certified testing for concrete. That fee was not to exceed $70,350. This amendment is for $10,750 to complete their services for the project. Additional soil testing was required due to unexpected soil conditions on the site, as well as additional soil compaction testing for piping that was added to the project. Staff recommends council approval of the attached agreement, and I can answer any questions you have.

Thank you.

Move to approve.

Mr. Goldhammer.

Second.

Second by Mr. Barrington. Further discussion?

Joe, where's the project at overall, budget-wise? Is it going to be still coming in under budget, are we expecting?

It's over the bid amount, but it's still within our contingency, within our budget. That should be wrapping up very soon. Completion date is September 1st. I think we had a few extensions due to some added work, but it's looking to be finished up this fall.

Perfect. Thank you.

Anything else? Anyone in the audience like to discuss this? All right. All those in favor of the motion, say aye.

Aye.

Opposed, same sign. Motion carries. Action to approve agreement A2026-51, Fire Station Staking 2026-08 with SPN and Associates, Mr. Schroeder.

Yep. Mr. Mayor, Council, SPN and Associates was requested to provide staking and testing services for the construction of the new North Fire Station building. SPN will provide staking for the new building and any associated utility and road improvements. They will also provide concrete and soil compaction testing where appropriate. The agreement is attached for your information. Staff recommends approval of the proposed agreement for services described in there and an hourly rate not to exceed of $30,000. I can answer any questions you have. Thank you.

Voted by Mr. Smith. Seconded by Mr. Davis. Further discussion? Any audience like to discuss this? All those in favor of the motion, say aye. Aye. Opposed, same sign. Motion carries. Actually approved agreement A2026-52, permanent easements for Ullman 23rd to Kemper Project 2026-06. And the rest shown in the agenda, Mr. Schrader.

Mr. Mayor, Council, a permanent easement agreement is necessary for the installation of underground utilities and grading work for drainage purposes at the identified location shown below. The easement agreements are attached for your information. Um, those owners are, uh, Lucas and Amy Norton, uh, Jody D, Camden and Samantha Miller, Brett and Nicole Sinke. Um, their addresses all are off of Augusta, but are adjacent to, uh, Oman. Um, staff does recommend council approve the permanent easement agreements and authorize the mayor to sign on their behalf. I can answer any questions you have. Thank you.

Motion to approve. Motion by Mr. McArdle. Second. Second by Mr. Goldhammer. Further discussion?

Joe, how are the dollar amounts calculated? Is it so much a foot based on the property, or how is that done?

Yep, based off of square footage. If you divide the square footage by the dollar amount, it should be the same number.

Thank you. Can you give us just a quick update on the project, Joe, on how it's progressing out there?

Yep. The roundabout is essentially complete. We're just tidying up some sidewalk items around there before we open it to traffic. Fingers crossed there's a chance it could be open end of this week or next week. All of the curb is poured on Oman, and they're finishing up fillet sections or the corners. They're also working on tie-ins this week. We hope that project has traffic started in the first part of October, and then sidewalks should follow shortly after that.

Yeah, we drove it today. It's really cool. It's like cement, and then there's red on the inside. It looks nice. It looks very nice.

Okay.

Anything else? Anyone in the audience? All those in favor of the motion, say aye. Aye. Opposed, same sign. Motion carries. Action to approve Resolution R-2026-38, Leavening Business Improvement District No. 3, Special Assessments for 2026 and 2027. Ms. Bathke.

This is the ninth year for the bid number three assessments. The amounts levied are based on the property valuation, and the levied amounts are payable in two equal installments due December 31st and June 30th of the year. The amount levied this year is $60,344. Thank you.

Move to approve.

Motion by Mr. McArdle.

Second.

Second by Mr. Goldhammer. Further discussion? Anyone in the audience like to discuss this? All those in favor of the motion say aye. Aye. Opposed, same sign. Motion carries. Second reading on Ordinance 02026-10, Updating the Standard Cable Franchise Agreement and Renewing Existing Cable Franchises. Mr. Johnson.

All right. As we discussed at the last meeting, this is really just renewing the existing cable franchises that are in place, updating a couple of contact information, thing like that. No serious changes to the ordinance. Thank you.

Move to approve.

Motion by Mr. Goldhammer. Second by Mr. Davis. Further discussion? Anyone in the audience like to discuss this? All those in favor of the motion, say aye. Aye. Opposed, same sign. Motion carries.

Motion by Mr. Goldhammer.

Second by Mr. Barrington. Further discussion? Anyone in the audience? Roll call, please.

Barrington. Aye. Schlimgen.

Aye.

Greenway.

Aye.

Smith.

Aye.

Savers. Aye. Goldhammer. Aye. Davis. Aye. McArdle.

Aye. Motion carries. Second reading on ordinance 026-11, amending provisions for the City of Mitchell discretionary formula districts.

Mr. Johnson. All right. Once again, as we discussed at the last council meeting, this ordinance would update provisions that we have adopted in our code as it relates to business... discretionary formula districts, particularly the Mitchell historic commercial urban renewal area. Those changes are being done in order to come into compliance with changes in state law that occurred earlier this year. Also discussed at the last meeting, basically the change at the state level that brought this change on was the state's removal of that urban renewal area criterion from the eligibility classification so that we can't we would have to adopt that classification for any property within the city that meets that standard whereas previously we could limit that to these urban renewal areas that we would define and I know Stephanie was gone last time. If there's anything that she wants to add.

Now, other than the state is the one that contacted us and said that our urban renewal area was no longer in compliance with state law. So we are repealing that to be in compliance with state law. It doesn't change the county's ability to adopt this countywide. Quite frankly, most of our other commercial construction is happening within TIF districts. So it's not really relevant specifically for the city of Mitchell.

Yeah, I did say last meeting that there haven't been any properties that have utilized this since it was adopted. Thank you.

Move to approve. Motion by Mr. Goldhammer. Second. Second by Mr. Slimkin. Further discussion? Anyone in the audience like to discuss this? All those in favor of the motion, say aye. Aye. Opposed, same sign. Motion carries. Looking for a motion to adopt. Motion by Mr. Goldhammer. Second by Mr. Barrington. Further discussion. Anyone in the audience like to discuss this? Roll call.

Greenway.

Aye.

Smith.

Aye.

Savers. Aye. Goldhammer. Aye. Davis.

Aye.

McArdle.

Aye.

Barrington. Aye. Schlemgen.

Aye. Motion carries. First reading on Ordinance 0226-12, providing a runoff elections for Mayor and City Council, Mr. Johnson.

All right. This ordinance was prepared at the request of a council member. Basically, what this would do is provide for runoff elections for mayor and city council offices. In the event that a candidate fails to get more than half of the vote in an election where there's multiple candidates, the top two candidates would then move to a runoff election that would take place several weeks later. If there were two candidates tied for second place, both of those candidates would advance to the runoff election. And then the election would be handled basically in the same manner as the original election. And really these provisions are almost verbatim what's in the state law. We don't have a lot of discretion to change provisions. how those runoff elections would be conducted. So I think with that, we can open it up to any questions.

I'll approve first reading. I'll second.

Seconded by Mr. Ricardo. Seconded by Mr. Goldhammer. Further discussion?

I think this gives people an opportunity, like all first readings, to reach out to us and discuss. This is an option. I'm the council member that brought this forward. I think that as discussions happened when I was, uh, running this last time around, uh, term limits and some of those conversation pieces, um, a lot of that was to encourage more people to run. And I think this is the next natural step to encourage people to run against their friends and neighbors, uh, having some kind of way to not allow for the risk of like, well, I don't want to take votes away from you or this person. Um, but rather we're trying to divide it, uh, And we can now have a specific majority taking control in the end. And so there's not a person potentially getting elected if there's five people that runs with less than 20% of the vote or whatever that number would be. But that's where that came from. It does not require a runoff if somebody does get 50%. And so there's a chance that maybe only one ward, for example, has the potential for a runoff, at the end of the day, there could be no runoffs. And so it's just, I think, something good to have on the record or a plan for, as that could be a potential issue.

Okay, anything else? Anyone in the audience?

Good evening, Mr. Mayor and Council. As you all know, my name is Stuart Hanson. I read the article in the paper about some on this council wanting to change the rules on how the mayor or council member is elected. They want to change it so that it would take 50% of the vote, a majority, to be elected like Sioux Falls does. It seems funny to me that when we talked about having term limits like Sioux Falls, some have said we don't want to be like Sioux Falls. But when talking about runoff elections, you say, if candidates in Sioux Falls don't get 50% of the vote, a majority, then the top two vote getters have a runoff. So now you want to be like Sioux Falls. Mr. McArdle was interviewed for the September 3rd edition of the Mitchell Republic. And if they accurately reported what he said, then I have to say Mr. McArdle was incorrect. He stated examples of recent elections for Sioux Falls mayor and the Republican primary for South Dakota governor in which a runoff was necessary. He said both of those races required a 50% majority of the vote to win. He also said, in those cases, the person who won the first election but did not get 50% of the vote, a majority, failed to win in the runoff. You were wrong, Mr. McArdle, when you said that a candidate in the Republican primary for South Dakota governor needed 50% of the vote, a majority, to win. A candidate only needs 35% of the vote to win the primary. Toby Doden finished first with 31% of the vote, and Governor Roden finished second with 25.2% of the vote. A runoff was necessary since no one got 35% of the vote. Those results... Governor Roden got 70.8%, Doden 29.2%. Wasn't even close. Why the big discrepancy? Because Dusty Johnson was able to give his cash and resources to Governor Roden to blow out Toby Doden. Does that sound fair? Not to me. No one thought Toby Doden had a chance in the primary. So sort of like Mr. Davis and the mayor, no one thought they had a chance either. Once Mr. Doden was the top vote getter, people decided they needed to do something about it. Hence, Dusty Johnson giving his resources to Governor Roden. Again, does that sound fair? Not to me. So if we had the 50% rule in Mitchell and Mr. Davis and the mayor shocked everyone by getting the most votes, but not 50%, and there was a runoff, I do believe this council or anyone else that didn't like those results would pool all their resources together to make sure someone else won the do-over election. Does that sound fair? Not to me. Mr. McArdle referenced the Sioux Falls mayoral race and said the person who won the first election but did not get 50% of the vote, a majority, failed to win the runoff. Again, not true. In the first vote, Christine Erickson finished first with 37.2% of the vote. Jamie Smith finished second with 28.2% of the vote. In the runoff, Christine Erickson got 49.92% of the vote. Jamie Smith got 49.1% of the vote. So in the runoff, Erickson, who finished first in the first election, won in the runoff. How much did it cost the taxpayers for that runoff election? Nothing changed. Erickson still won. But here's a question I have. Why doesn't the Mitchell Republic fact-check what the council members say before they print it? Mr. McArdle, you said you were voting in favor of this ordinance even before it's been brought to the council for discussion. You said it isn't fair when someone wins with less than 50% of a majority of the vote. From the information I could gather, only two cities in the whole state of South Dakota require a 50% majority to win, mayor or city council races, Sioux Falls and Rapid City. Mr. Davis received 38% of the vote, which would have been more than enough to win the Republican primary for governor. Same goes for the mayor, who received 41% of the vote. What if Mr. Terry Sabres got 41% of the vote and the mayor got 40% of the vote? Or Mr. Dosher got 38% of the vote and Mr. Davis got 34% of the vote? Would we be having this discussion right now? I don't think we would. Let's not change the rules because someone doesn't like the way certain elections turn out. Thank you.

Anyone else in the audience like to discuss this? Okay. All those in favor of the motion, say aye. Aye. Aye. Opposed, same sign. Motion carries. 2027 proposed budget overview.

Okay. Shown on the screen are the tentative proposed budget work schedule that we have for 2026. It's important to point out anybody who's watching these or coming to the meetings that this is an ongoing discussion. Any documents you see from meeting to meeting can change as council goes through their discussions. The annual budget hearings are scheduled for November. So we'll have the first reading on November 3rd and the second reading on November 17th. First, to start off with, the city did propose.

What? I just also, just for those watching at home, if they're watching on Mitchell Telecom, we will broadcast those on our YouTube channel, but not necessarily make it available. But Mitchell Telecom chooses whether or not they pick it up.

That's a very good point. It will be broadcasting on YouTube, but it is up to the cable channels to stream those if they are showing or not. Any of the documents that you see as we go through the work schedule or work sessions as well, those will be posted online. This was also posted online in advance of the meeting tonight. Andrew, can you switch to content? Oh, it is. Okay. Sorry, I'm trying to do both here. First to start off with, we had mentioned at the last facility tour that we did forecast a conservative budget this year. We're not really showing any growth in sales tax for 2027. We did bring sales tax up to the levels collected in 2025. But the reason why is so far this year, it has been pretty volatile. As of the first half of August, I believe, right, was the last one. I keep getting my months messed up. We were at, I believe, 2.5% above 2025, but that has ranged every month. You can see here, this is the total taxes collected on the state's report. We've been down up all over the board. So just to be conservative moving forward, we did keep those at the levels collected in 2020. 2025, excuse me. Down below you can see year to date through July off the state's reporting where our sales tax categories have changed. So you can see the ones in red are down from the previous year and the other ones are either flat or increased. As I said, the 2026 budget was $400,000 below the 2025 collections. So in the 2027 budget, we did bring it up to the 2025 collection level. So we'll see a small increase in revenue for sales tax due to that. But again, we only went from 2.4% above in July to now the first half of August, we were 2.5% above. Entertainment tax collection, this has been much more volatile than sales tax has. Actually, as of the first half of August, we've now dropped and we are 1.1% below. And as you can see, my first bullet, when I put this together, we were above, but now we've dropped again the first half of August. We did, I do forecast a slight increase from 2025 collections in the 2026 budget, but you'll see in 2027, we're bringing it back down to the 2025 collection level, just because I don't think we're going to hit that at the end of this year. And again, entertainment tax has just prepared food, alcohol sales, ticket sales in hotel rooms. So as we go through the proposed budget, just some things that we'll review today is the overall projected revenue, expenditures, where we're looking at for cash balances, what capital items are in there, and then council. Obviously, if you have questions as we go through, I did add some pictures and things like that into some of the capital requests. And then you guys can give direction to staff what you would like to see at future meetings. So to start, our total proposed revenue budget is $66.9 million. There you can see the individual revenue broken out by each fund, but the total revenue budget for 2027 is $66.9 million. If you just look at the general fund revenue, which is where we do the majority of our operations out of, the proposed general fund revenue budget is $27.8 million. You can see last year our, oh wait, that doesn't show up here. Here we go. Last year, we were at $31.3 million. This year is at $27.8. The decrease is really because we have less SRF financing coming into the revenue budget for 2027. But here you can see those revenue broken out by different categories. 88% of the general fund revenue comes from taxes. If you look at those taxes, I mean, that's a question we get a lot every year and you break it out by the category of tax. I like to show this because the lion's share of what we do as a city comes from sales tax. So 68% of the taxes we collect comes from sales tax. Property tax is about equal to one penny that we collect. And then we have some franchise fees as well. Let's see if I have any other notes. We'll keep going there. Special revenue fund budgets. Funds are classified as special revenue. They still receive general fund support. Not all of them. The bids don't. They may receive general fund support, but they really have a specific purpose and their revenue is kind of segregated into that fund to help them fund what they're doing. So the funds that you see here that would be receiving general fund support would be airport, nutrition, Lake Mitchell, 911, community services, and the park fund. community services would be our James Valley Community Center and Palace Transit. Here you can see the comparisons of our enterprise fund budgets. Again, enterprise funds may receive support from general fund. The difference with enterprise funds is they operate like a business, so we track the activities of those funds like you would track the business account. So here you can see campground, golf course, corn palace, EMS sanitation, sewer and water. You'll see a big, the largest changes would be we have some capital projects going into the corn palace revenue there, so they're getting transfers in from other funds. You'll see sewer fund revenue is decreasing, but that's just due to a decrease in financing proposed in the budget. The golf course fund revenue decrease is because in 2026 they received a general fund transfer to do a capital project. When you look at the total city expenditure budgets, the total expenditure budget is $73.3 million, and then you can see the detail broke out by fund. Of course, general fund is $28.5 billion, and then we go from there. General fund's the largest one, followed by water at $12.5 and sewer at $8 million. When we look at general fund expenditures, we kind of break those into categories. So you can see there the general government, public works, law enforcement, and cemetery. I got to look at my bigger sheet so I can read this.

Okay.

So general government, general government services is 2.9 million. That's about 10% of the general fund budget. And you'll see that those changes aren't really very significant. I think the only one, we had some capital purchases in 2026 for IT. We did some server upgrades and a firewall upgrade. And we are budgeting for those next year. Cemetery is 1% of the general fund budget, and you can see the change there, 2026 versus 468. This year is 342. Library is 3% of the general fund budget. That is going up in, that should say 2027 proposed in 2026. Sorry about that. Law enforcement is 4.3 million, and that is 15% of the total general fund budget. Within that law enforcement category, we include animal control and the police department. Fire is still up their ways. Last year it was higher because we transferred $2.5 million from general, we didn't transfer, we were using reserve funds in order to construct our new fire station. The 2027 budget includes additional funds to finish that fire station as well as some equipment needs and furniture and fixture to finish that building as well. Fire represents 11% of the total general fund budget. And then we have public works. That's $7.8 million, which is 27% of the general fund budget. There you can see the categories of difference. You'll see a big decrease in storm drainage. That's really because we had some SRF projects planned in 2026 that we are doing much less of in 2027. Same with street and sidewalk. Less projects coming in in 2027 than in 2026. Other uses is 32% of the general fund, and that's $9 million. And you can see how that's broke out between subsidies. We have a new proposal this year moving some of the subsidy funds into an internal economic development position. contingency we've got our debt service payment that stays pretty flat every year we haven't taken on any new debt from general fund and then transfers out and last year our transfers out was probably the highest it had been in five years and we didn't drop down the amount that we increased we're still at a really high level the transfer to park loan is a million dollars over the three-year average so we're still up there quite a bit from where we used to be in the past And here you can see where those transfers out of general fund are. So as I said, last year in 2026, we had 4.7 going to the general fund, but that included $1.5 million to replace the roof, as well as the infield project and several other projects that we were doing. This year, we're not down much, and we're not doing that $1.5 million project. We just have that many other capital projects that are proposed out of that park fund for 2027. The reason why we don't have transfers to Airport E911 in 2027 is they have sufficient cash balances that they won't need that general fund cash in 2027. Golf Fund, the only reason why we transferred money last year was for the, I think it's Phase 3 project, the short course that the council had approved, and obviously we wouldn't be doing that next year. You would have already received a handout that shows what the subsidy funding. Hold on, let me switch my glasses. history is for the past couple years as well as what the proposal is for this year. Currently, the subsidies were plugged in at last year's funding level beyond that one change that was made to MADC. Everything else was plugged in at the 2026 funding level. Any new applications were not currently funded in the proposed budget. When you look at special revenue fund expenditure budgets, you can see the breakout here. I didn't mention this during revenue, but bid three is a Main Street bid. All the revenue that they collect from that tax assessment just stays in their fund, and they're using it for grant and other projects that they're working on. Bid four is the hotel bid. All of that money stays in the bid four fund, and they just use it for SEA and then anything else that that board decides that they're going to move forward with. Here you can see the changes to the community services fund on the left. Palace Transit shows a slight increase. James Valley Community Center also has a slight increase. Nutrition Fund, they are taking on another contract, I believe, that shows the increase in expenditures for 2027. They do also have in Palace Transit two new bus purchases included in that budget request, but the city is very fortunate. We only pay a fraction of the cost. The state DOT covers the majority of that cost for us. Airport fund, you can see a significant decrease. In 2026, we did the runway construction project. That project has been removed from the budget, so that's why the budget request has dropped. The 225 is more realistic of what we do on an annual basis. entertainment tax fund. You can see the breakout that's proposed in 2027 to come out of this fund. We have the CVB funded at the 26 level. We are increasing the transfer to the Corn Palace. It includes $375,000 to do The floor and subfloor replacement out of entertainment tax fund reserves. I think I got that number right. I'm looking for the mayor to nod his head. And then we also had transfer out to the park fund out of current revenue. And that was to help fund the splash park that or splash pad that's proposed in the budget. The 2026 community projects that includes the Corn Palace Plaza that we're getting close to coming back with design for Council to review on the much scaled down option when the budget was set at 650. Within the park fund, the total park fund is 6.2 million. You can see how that's broke out by individual departments. The largest amount going to the parks, 36%, followed by sports complex at 23%, and then rec center at 20%. Enterprise proposed budgets, you can see those broke out. And here's the comparison from the previous year to this year. Again, similar to revenue, you're going to see the wastewater expenses go down just like the revenue went down because we don't have the SRF finance projects within that budget. Campground fund in 2026 included the construction of the shelter, which is no longer in the budget. That's why that has a significant decrease. Corn Palace fund, not really that much of a change, I guess 300,000. We did the seat project in 2026, but we also now next year have the floor replacement and a couple other capital projects planned as well. EMS fund, slight increase. Sanitation fund, the total budget is $4.3 million. You can see the majority of that is within the landfill, 76% followed by collection and then recycling. And here's the changes from last year to this year. Last year at the landfill, we did have a project, so that construction project is going to be removed out of the budget for 2027, or capital project, not construction. Water fund is $12.5 million. The largest part of the water fund would be distribution, water distribution at 53% followed by treatment and then our debt service payments. This would be the annual debt service paid for projects that are financed with SRF loans. And here you can see the change from 2026 to 2027. Wastewater fund is at $8 million. You can see the largest percentage of that comes in at the debt service at $3.5 million annually, followed by collection and then the treatment plant. And here's your changes from 2027 to 2026. So you'll see the debt service jumping up because of the projects being completed. So this one, the yellow is 2027. Oh yeah, you guys can't see that. Sorry. In the proposed budget, there is cash being applied from reserve, nutrition, airport, community services, 911, and EMS. Those are just using cash balances for balancing their budget. We've had several years where we've had health insurance premium holidays at the end of the year, so they have some cash. that was already transferred from the general fund in previous years, so we're going to apply some of that to bring that cash balance down. Entertainment tax fund, that's the $375,000 that would be used out of dedicated reserves for Corn Palace facilities towards the replacement of the floor and the subfloor in the Corn Palace. General fund, that is We had $300,000 being applied from reserves for sidewalk assessments. We've had actually additional conversations since then. I think we're going to change the way we're budgeting that into a different fund. We have sidewalk money set aside, so it's not something that really affects general fund cash. And then the rest is coming out of future capital projects for the splash part. And then you can see sanitation and water fund cash applied as well. These funds are adding cash into reserves. Campground fund, they did propose purchasing a mower for the campground, but the cost was $40,000. And so unless they show that they have the cash balance available, which I can't predict until the shelter project is done, we couldn't give them permission to move forward with that because it would require me to give them money from general funds. So depending on... how they end this year, they could potentially move forward with that as a supplement in 2027. This slide shows the projected reserve balances at the end of 2027. All of these will probably be slightly higher because of another health insurance premium holiday at the end of the year. So when you see parks at 25,000, it's going to be higher than that. Same with the other one shown here. Campground, I'm not sure because that just depends on how that shelter project turns out. I should point out the Lake Mitchell project that assumes that we've already done what we budgeted for Lake Mitchell. So that's why that balance looks low. It's kind of assuming we already moved forward with the part that we are paying for cash for that project. We have two different dedicated reserves. In the general fund, we have future capital projects. After the proposed budget, this would show that we still have $4.2 million sitting in future capital projects. And in the entertainment tax reserves, you had Corn Palace Capital Improvements, facilities is what you had set aside. We're taking about half of that out towards the floor, but there's still going to be money left in there as well. I did summarize the total capital improvements by funds. So you can see the line share is coming from the general fund, 5.3 million down through the line there. But it is important to point out that park and rec, corn palace fund, entertainment tax fund, not entertainment tax, I said that again, park and rec, corn palace, and community services airport funding all receive support from general funds. So general fund is supporting those as well. If you look at the type of improvement broken out by type or the capital improvement broken out by type, the majority of our improvements would fall under infrastructure. The facility improvements at just over $4 million, that's largely doing repairs and deferred maintenance that are needed on city facilities. And then equipment at $2.6 million. For those capital projects, we are receiving revenue in to offset some of those costs. So some of those infrastructure projects have SRF financing tied to them. We are also using assigned reserves towards projects. We get an annual payment from the state for maintenance of roads. So when you see our chip ceiling and overlay maps, those are all funded by the STIP funds. And then we do have some donations listed as well. The sheet shows our largest projects over 300,000. So you can see Sixth Avenue from Juanita to Sanborn. When you add water, wastewater and the storm sewer improvements together, the total project is 4.1 million. First Avenue with all three of those added again together is 4 million. And then you can see down the line from there. We have a listing of the proposed infrastructure projects. They're going from the least expensive to the more expensive at the bottom. These ones will have the First Avenue and Sixth Avenue broke out by who's paying for that improvement. So you'll see there's a general fund, stormwater, wastewater, and water cost to each of those projects. These would be our proposed facility improvements. and then the proposed capital equipment projects as well. We do have, let's see if I corrected this. I did. That's great. Some design engineering projects in here. We originally, I think on the sheets you guys might have received or in the original proposed budget overview, we showed the design of National Guard Road. That is actually going to be done in-house. So that's been removed from those documents. And it was done that way when we did the proposed budget. I just missed it in your overview. This map shows where that sixth avenue from Juanita to Sanborn is. I hope I'm getting this right, Joe, but I think when we talked about this, this one's in maybe a little worse condition than the first avenue, the infrastructure underneath the road. I do want to note that to move forward with the stormwater and the wastewater improvements, that assumes that we are getting SRF financing. That would require the city to increase sewer rates by $1.73 per user per month within our rate structure in 2027. We do not have cash available for doing those projects out of the wastewater fund. Same with First Avenue from Burr to Foster. And you can see here that estimated surcharge would be $1.79 per month per user. So that would have to result in an increase to your sewer rates, both of these combined to move forward with both projects. And those rate increases, what happened in 2027, they would be required to get the SRF financing. We would have to do that rate increase. This map, the little blue lines on the map show which roads are planned for overlay improvements. Again, we fund these out of that STIP money that we get from the state. So it really covers our annual overlay projects that we do. We have two parking lots planned for improvement. The one on the top right is at the airport. You can see that one's proposed at 40,000. And then down here on the bottom left of the picture is Lyons Point Park, and it's this big gravel area that was planned on being paved as well. We do know a lot of people pull into here and use it as an access point to access the new bike path out by the lake. The mayor had several other parking areas around the lake proposed, but ultimately those were removed from the budget when he was balancing. There was a proposal included in the budget to do a splash pad. The mayor's location was proposed at Hitchcock Park. Here you can see just some examples of other splash pads in South Dakota. The one on the top left was in Sioux Falls. Actually, both of these are in Sioux Falls. This was at Meridian. bridge in yankton this is rapid city and this is watertown's founder square i think is what they call it their main street area their proposed funding for this is coming out of future capital projects reserves 377 the mayor has a private donation that will go towards that construction we have entertainment tax collection revenue coming in 2027 and then 26 000 out of current general fund revenue Second fire station, we talked about this when you did the bid award. We needed an additional $750,000 for the project. That will cover contingencies, testing, staking, and the professional engineering services. In addition, in the fire budget, you'll see 100,000 for furniture, fixtures, and equipment. We were hoping to just go out and purchase those. We could have probably done that quite a bit cheaper, but we're going to have to go off state bid and buy those items. So it's probably going to drive that cost up a bit. We also have an alert system for the new fire station that lets them know when calls are coming in as well. On the right, you're just seeing some pictures of the proposed new facility and what it's anticipated to look like on the inside as well. The furniture, fixture, and equipment would include everything from the cots to the lockers to the equipment needed to operate that facility to get it going. The furniture, tables, chairs, that kind of stuff. Street shop addition, this is one that we put a priority on just because by, you can see the red shaded area on the left of the street shop, that will allow another bay for the mechanics to work on city equipment. They work on all city equipment, general fund, sanitation, water, wastewater, everybody. By having that, extra bay it will actually allow more work to get done that's why we put a priority on that one you can see the funding is split between general funds sanitation fund and the water fund Z wall, we talked about this on the tour, but I thought it might be helpful to see some pictures. So the location at the landfill is on the right. For those who weren't on the tour, it allows people from the public an easier way to come and drop off materials at the landfill without actually having to drive into the cell. So here you can see some examples, and this is Rapid City's facility, and you can see the cars backing right up to the wall, and they put the material over the wall into the dumpsters, which then go into the landfill. That is funded out of the sanitation fund, but I thought it'd be helpful to see what that looks like. Sports complex improvements, there's $434,750 worth proposed. You can see the listing right now. We have the Drake restroom remodel, replacing the fencing in the field A. They're doing sports scheduling software dumpsters. I won't read through the whole list, but you can see all the capital improvements for sports complex. This on the left shows the Drake restroom and the need for the remodeling. The yellow shaded area on the top left shows where the restroom is located. On the right is the backstops where the fencing is proposed to be replaced. Park improvements at 193,000, adding heaters for outdoor restrooms. The trees are funded through a trees grant that Kevin gets annually. You'll see another remodeling project for Dry Run Creek. Monroe Park improvements, those are shown here on the right. It's kind of hard to see in this picture, but if you look on what was sent out to your online, there's a retaining wall right here. So it's doing these improvements over this side of the park on that retaining wall. Some landscaping, I think sidewalk to Kevin. Yes, okay. Oh yeah, I have it right there. Sidewalk and retaining wall. Good job. Improvements at Lake Mitchell. We've got the shelter on the jetty. That would be this yellow square here. Again, there is grant funding to offset some of that cost. The railing on the concrete ramp. This ADA trail. to the shelter at Camp Arroyo. This is the new shelter that was recently completed. So I'd be adding the ADA trail from the parking lot to that shelter. Rec Center had $164,000 worth of improvements. The only one I'll point out on here is that with this weight room, a replacement equipment, oh, shoot, sorry, at $20,000, the intention would be with the equipment that they're replacing, they would take that used equipment and then give it to the police and fire. And that's why police and fires were cut out of their budget. They're going to take the hand-me-downs from the Rec Center. I was asked in the new fire station, there's also planned equipment in there as well. That would be part of the FFE that we have budgeted for fire station two. Outdoor pool improvements, you can see 158,500. A lot of this is really refurbishing the outdoor pool, doing some improvements there. It's a great photo that Shannon caught on our drone for us, so I have a nice video to show you someday on that. Improvements at the golf course, these are all being funded by the golf fund, so they're not requiring any general fund money to move forward with it, but you can see the HVAC in the clubhouse, that would be the top left square here, drain area, the bunker number seven renovation, and cart path repairs. Just because there was some confusion on this earlier in some of the articles that we did include just a list of everything that was cut from the budget. And the reason why is when you look down this list, these are all items that would need to come from general fund to move forward with them. So there was $11.6 million worth of needs or requests that were cut from the budget. These would all have to be funded from general fund to move forward. So we just simply don't have $11.6 million to put all of these things in the budget. In order to propose a balanced budget, you had to start from somewhere. So these are the items that have been removed in order to balance. And this is what we have for proposed work session. So we have our first full work session scheduled for next Monday, starting at 530, if that time still works for everybody. Can certainly answer questions on the overview. And also, if you have any direction that you want us to bring back to you for the next meeting, we can do that as well. But that's my overview for the day. I'm ready for questions. Mayor, do you have anything to add?

No, it looked great. Anyone have any questions for Stephanie? I think she went over everything.

Okay.

Very in-depth.

I will. I have received individual questions on budget items. I just keep an ongoing list of that for you as we go through the process. Just for new board members, I want to also point out, oops, you guys have already received this. sorry i'm still a little blind so as you go through your budget discussions this is your council review list i will continue to make notes on this list and you'll have an updated list as those discussions happen so if council says we want to come back and discuss item number 49 on that council review list i'll have that noted and i keep highlighting and and keeping track for you as you go through your discussions, if that makes sense. So I will always have an extra one of these available to you. Otherwise, it is all contained in the materials I already gave to you. Does next Monday at 530 still work for everyone? Okay. That's all I have then. Oh, I got to get this up. Our next item is going to be, unless there's questions.

Any questions before we move on? Okay, then I will do executive session. Motion to enter into executive session according to SDCL 125.2.3, consulting with legal counsel on SDCL 1919.502, lawyer-client communications. So moved. Mr. Goldhammer. Thank you, Mr. Davis. Further discussion? All those in favor of the motion, say aye. Aye. Opposed, same sign. Motion carries. There will be no action after executive session.