Item 5D. Approval of the 2027 General Fund Operating Budget
Superintendent's Recommendation:
MOTION TO APPROVE THE 2027 GENERAL FUND OPERATING BUDGET IN THE AMOUNT OF $57,392,150; AND FURTHER, AUTHORIZE THE SUPERINTENDENT AND CHIEF FINANCIAL OFFICER TO FORWARD THIS DOCUMENT TO THE HENNEPIN COUNTY BOARD OF COMMISSIONERS FOR REVIEW PURSUANT TO STATE LAW.
Prepared By: Shaan Hamilton, Chief Financial Officer
Background:
Development of the Park District’s 2027 General Fund Operating Budget began in early summer. The Superintendent led senior staff through multiple budget discussions where options and issues were discussed and evaluated. This process led to several budget discussions with the Board during the summer and fall, and resulted in a budget that supports the following goals for 2027:
- Continue to provide high-quality facilities, programs, and recreational opportunities.
- Continue to manage natural resources, be a leader in natural resource management issues, and educate the public on natural resource management issues.
- Continue implementation of the System Plan by providing a wide range of services to Park District users both within existing park locations and in residents' local communities.
- Use non-property tax revenue to fund needed budget increases.
The attached 2027 General Fund Operating Budget document shows the Park District's operating budget goals, challenges, and how funds are going to be received and expended.
The public was invited to comment on the budget at a public hearing held prior to the Commissioners considering adoption of the budget.
The major revenue changes for the 2027 budget totaling $1,979,137 include:
- A 3.79% increase in the total property tax levy which results in an increase for the General Fund of $1,320,457.
- Park use revenue estimate increases for a variety of locations and revenue streams combined with fee increases for some fees and passes resulting in a budgeted increase of $693,439 (fee increases are proposed for tube rental, swim ponds, overnight camping, summer camp programming, and merchandise sales).
- Met Council Operations and Maintenance funding decrease of $30,108 and outreach grant budget approach changes of -$44,000, which have a $0 net impact on the budget. These changes total -$74,108.
- Interest and other miscellaneous revenues are being increased by $39,349 based on amounts collected in past years.
The major expenditure changes for the 2027 budget, which total $1,979,137, are:
- Inflationary increases for union employees in addition to continuation of the existing step program as outlined in their contracts.
- A 2% inflationary increase for non-union employees combined with the existing merit pay program with an increased growth factor for pay ranges.
- Increased costs for health, life, and dental insurance due to increasing premiums. Increased contribution to the District’s Equipment ISF Fund to manage the costs of operating and maintaining the District’s fleet of vehicles and equipment.
- Increased the contribution to the Risk Management Fund to begin to address the negative fund balance in this fund and on-going annual deficits.
- Due to inflationary pressures and existing contracts and services, increased expenses associated with cleaning supplies, chemical products, janitorial and waste services, utilities, software, consulting services, and technology.
- Reallocation based on programmatic & leadership reorganization (reduce 3.2 FTE).
- Reallocation of seasonal staffing based on reorganization.
- Reallocation of communication, advertising, printing, & postage expenses due to centralization.
- Shifting Natural Resource Management and Maintenance seasonal salary expenses and non-salary expenses to Capital Investment Program Fund and Preservation and Rehabilitation Program Fund.
- Realizing efficiencies through reductions to expenses associated with general supplies, contracted services, equipment, mileage, and other expense categories.
Upon approval of the budget, the Park District, in accordance with state law, must submit the operating budget to Hennepin County for their review. The County Board has 15 days to review and recommend changes to the Park District’s Board. The Superintendent will present the 2027 budget at a Hennepin County committee meeting November 17.
As shown in the table below, the final phase of the budget process is the approval of the 2027 property tax levy. This item, including a resolution, will be presented to the Board for adoption on December 17, 2026. In addition, any comments from County Commissioners will be reviewed with the Board at that time.
Relationship to the System Plan:
The Request for Action supports the following goal(s) of the System Plan:
Goal 2: Parks Matter
Goal 3: Lead by Example
The Request for Action supports the goals of the System Plan by providing and properly managing the financial resources of the Park District.
Attachments:
