After a half-hour budget meeting and a brief discussion during the city council meeting, the Tracy City Council on Monday approved a 5% preliminary levy hike for 2026.
The council voted 6-1 to back the levy increase, with the lone dissenting vote coming from Seth Schmidt, who told the council he would be more comfortable at 3%.
“At the end the day, I really think we should try to get this levy increase down to the size of inflation, which is estimated around 3%. I understand the idea of levying a little extra for unforeseen things that might come up, but I don’t like the 5%.”
Council member Jan Arvizu hoped the proposed levy could be lowered down to 4%. Council member Jeri Schons said determining a levy is less about inflation and more about the improvement projects the City has undertaken recently.
“We can’t just look at inflation; our citizens can’t just look at inflation — we do have expenses in the city that are going above and beyond,” she said. “Unless we want to start kicking cans down the road like that has been done in the past. As a City, we’ve work hard to try to and get some of those cans corralled. I would hate for us to start kicking them down the road again.”
Schons said many other cities are facing the same dilemma as Tracy and that the City was higher a few years ago because of the infrastructure projects.
“I would like to keep it at a 4 or a 3(%), but right now, we still have to keep up … we can’t go quite that low yet,” said Schons.
Councilman Dave Tiegs made the motion to approve the levy resolution, and Schons seconded.
The levy will be ratified at the Dec. 8 council meeting. Until then, the proposed levy can be lowered but cannot go up.
The proposed levy shows preliminary expenditures of $8,096,013 and revenues of $8,397,445. The rolling sums of money for the current year, collectible in 2026 upon taxable property in Tracy is levied for the following purposes: General Fund ($862,416); Debt Services ($611,500); and Capital Fund ($194,000) for a total levy of $1,668,916.
Three percent fee increases for water, sewer and storm water are included in the proposed budget and levy.
At the meeting prior to the regular council meeting, Tracy City Administrator Jeff Carpenter said the City cut the “Cleaning up Tracy” budget for 2026 by $20,000 down to $30,000. He said the $50,000 budgeted for this year will more than likely be used this year.
“Thirty thousands dollars is still, three houses, maybe,” he said. “Maybe four depending on how big a house is. I still think we need to have money in there. In years past, there’s always been money there for that.”
Carpenter added nothing in the City’s Capital Improvements budget was cut. The largest CIP item is a dump truck for $100,000; the current truck dates back to 1987 that “we are currently making parts for,” he said. “It’s time obviously to get a new dump truck.
In other business Monday …
• The council accepted $1,600 donations for park benches at Central Park from Deb Deutz and Steve Maertens; Madonna Peterson and Mellissa Whiting; Sandy Fultz and Darcy Carlson; Tyler Twistol; and Minnwest Bank.
• It was reported that concrete for the sidewalk surrounding the new playground in Central Park will be completed within the next couple of weeks.
• Water service to the new 2nd St. East house has been installed, with sewer service coming next week, weather permitting. A selling price is yet to be determined.
• Community Development Director Tom Dobson said purchase agreements for the two new UCAP homes on Front St. have been signed, but the deals have yet to be closed.
• Dobson informed the council that the City has been awarded a $100,000 Housing Grant through the 2025 Greater Minnesota Small Cities (Tier II) Housing Grant Aid Program. The grant can be used for low- to moderate-income housing or rehabilitation projects in Tracy.
• Dobson thanked Premium Plant for the landscaping work the business did at the “Welcome to Tracy” sign on the east side of town.
• The National Night Out committee has donated a flag pole for Central park to be located at the southeast corner of the park.
• The City received $4,084 in revenue from Swift Lake camping from May-August, compared to $11,681 during the same time period last year. Licensing revenue through the first eight months of 2025 was about $2,200 lower than in 2024, but $400 higher than the City’s second highest year in 2021.
