A significant portion of the meeting was dedicated to the budget for the Victoria Recreation Center (VRC), which is projected to generate $1.3 million in revenues for 2026. The assistant city manager and finance director, Trisha Pollock, presented that 71% of these revenues will be sourced from the Eastern Carver County School District through lease contracts and reimbursements for staffing and maintenance. The remaining 29% will come from memberships and facility rentals. This marks a 6.2% increase from 2025, attributed primarily to an increased lease from the school district and higher membership rates. The lease with the school district extends until 2032, aligning with the debt payments for the facility.

The VRC’s operating expenses for 2026 are estimated at $839,000, reflecting a 7.8% increase, driven by rising wages, utility costs, and necessary repairs to support new programming, including a skating program. Notably, $340,000 (23% of expenses) is earmarked for debt service, also concluding in 2032. Planned capital investments of $102,000 include flooring replacement, renovations to the multi-purpose room, gym floor refinishing, and painting the building’s exterior arches, addressing community feedback about the center’s appearance. The council members discussed the scope of the flooring replacement, confirming it would focus on the multi-purpose room and exclude the lobby area.

In terms of utility funds, Pollock presented that there will be no proposed increases to the water base or consumption rates, though there will be an increase in the Minnesota Department of Health’s safe drinking water service connection fee, rising from $940 to $1,522 annually, a cost that will be passed through on utility bills. Proposed increases were discussed for sewer and stormwater rates, with the sewer rate set to increase by 9%, raising the base fee from $14.63 to $15.95 per month, impacting average homes with a projected monthly increase of $3.30. This is part of a planned five-year incremental increase to keep pace with rising fees from the Metropolitan Council. An adjustment in the winter sewer averaging structure was also proposed, moving from a three-month average to a six-month actual usage calculation from November through April to more accurately reflect water usage and alleviate resident billing confusion.

For the stormwater fund, an 8% increase was proposed, raising the base fee from $12.83 to $13.86 per month, justified by the expansion of the stormwater department and compliance with MS4 permitting requirements. Discussions arose about the implications of not implementing the proposed rate increase, with some council members suggesting a smaller increase due to healthy current fund balances and financial pressures on residents from other local entities.

The council also reviewed broader capital improvement plans, emphasizing the fire department’s needs. The 2026 budget provisions include replacing several command vehicles and extrication tools. The council discussed future budget plans from 2027 through 2030, which feature additional command vehicle replacements, portable radios, an unmanned aerial vehicle, a utility pickup, a grass rig, and a rescue boat. Consideration for leasing a new ladder truck in 2030 was also mentioned, alongside discussions on the market value and disposal approaches for old vehicles and equipment.

Public works equipment needs were also highlighted, with plans for a roller compactor for asphalt maintenance and replacement of aging vehicles. The council discussed acquiring equipment to perform fertilizing in-house, reducing annual expenses from third-party contracts by utilizing existing staff with or obtaining fertilizer licensing. Concerns regarding storage space for public works equipment, especially with a new fire station serving as a storage facility, led to discussions on the utilization of the old public works site for storage and emergency equipment. The council recognized the need for careful consideration of operational efficiency and financial implications for future equipment storage solutions.

The council ended with a conversation about the capital facilities fund, future land acquisitions for developments, and a second water treatment plant anticipated to require five to six acres of land. Additionally, discussions on long-term street maintenance fund allocations for street overlays and ensuring that the project budgets align with community infrastructure visions were emphasized. The council recognized the importance of ongoing communication and clarity about project budgets to meet community aspirations effectively.