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ARDEN HILLS CITY COUNCIL — DECEMBER 8, 2025 8 Finance Director Yang stated this item was presented to the City Council under agenda Item 10A. Councilmember Holden responded to some of the public comments. She explained the Council has been working to address the needs of the community while also investing in future improvement projects. She asked if the City Council worked inflation into the proposed budget. Finance Director Yang reported the City had inflation incorporated into the budget. Public Works Director/City Engineer Swearingen explained his estimates include inflationary expenditures. Councilmember Holden discussed how significant budget increases from the Lake Johanna Fire Department and Ramsey County Sheriff's Department were out of the City's control. She reported the parks plan assisted the City with planning for the future. She commented on how it was not important to her what other City's tax rates were, but rather she was focused on meeting the needs of this community. She reported the dollars being transferred to the fire department would cover the expense of the new station. She indicated the City could not make an early payment on the bonds until year nine. She discussed how the City operates with a very lean mix of staff members and noted the City needs staff members to complete inspections, code enforcement as well as replacing the Community Development Director. She commented on how the proposed step increases and raises were assisting the City with retaining staff members. Mayor Grant stated the City could not pay off the bond before year nine. He explained the City did not anticipate having $165,000 surplus each year from the franchise fees. He indicated the City worked to get the number as close as possible to the bond payment. He reported the excess funds would be going toward the fire department staffing increases. He commented further on how the City Council and staff plan for upgrades and improvement projects in the community. He discussed how Arden Hills was different from surrounding communities, noting Arden Hills does not receive LGA or driver's license bureau revenues, nor does the City have a community center to fund. He was of the opinion 18.3% was too high for the levy. Councilmember Rousseau explained she would like to have more conversation around the budget given the information the City Council now has regarding the 2025 surplus. She thanked staff for the detailed information that was provided on the proposed levy at 15.97%. She stated she had an interest in discussing a further reduction to the levy bringing it down to 13.97%. Councilmember Monson commented she supported the tax levy being set at 13.97% which included an allocation of $780,000 to the general fund reserves, pays for the permit software and pays for the comp plan one time payments. She indicated supported using reoccurring revenues for reoccurring costs. She discussed how a community has to be growing in order to have new revenue streams coming in. She reported Arden Hills was a mature community, aside from Rice Creek Commons. She explained she supported the City Council moving forward with a 13.97% tax levy. Mayor Grant addressed the statement that was made regarding the fact the City underfunded the 2025 budget. He discussed how the City ended up with a $900,000 surplus in funding which meant the City had not overtaxed its residents. He supported the City being conservative with its