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The Albert Lea City Council on Monday approved a preliminary 15.75% increase in the overall tax levy for 2025, much of which can be attributed to the recreational facilities referendum that was approved earlier this year.

Specifically, the council approved a 4.98% preliminary increase — or a $383,000 increase — in the general fund levy and a 10.77% increase — or $828,500 increase — in the total debt levy.

The total levy would be at about $8.9 million, including $6.11 million for the general fund levy and $2.98 million for the debt levy.

Albert Lea City Finance Director Kristi Brutlag said the largest increase in the 2025 general fund budget came from an about million increase in personnel costs following a wage study.

Brutag said personnel expenses make up about 72% of the total expenses of the general fund, which she said is pretty typical of cities.

The council also approved adding $60,000 more than in 2024 to the Broadway Ridge Fund, for a total of $205,000 in 2025, while taking away $60,000 from the building maintenance fund.

The preliminary budget for 2025 was set at $20.75 million, an increase of about $864,615 — or 4.3% more than the 2024 general fund budget.

Brutlag said in addition to the $383,000 general fund levy increase, revenue changes for the 2025 budget included a $70,000 increase in franchise fees and a $50,000 increase for the cannabis sales tax.

She said 33% of the city’s money comes from local government aid, 29% from city property taxes, 16% from charges for services and other, 12% from transfers from utility funds to cover and 10% from franchise fees.

Out of the 2025 budget, 43% covers public safety, 20% culture and recreation, 16% public works, 14% general government and 7% for funds transfers for equipment.

The preliminary total debt levy was approved at $2.79 million, an increase of $828,500 from 2024. Of that amount, about $738,000 would go toward the recreational facilities improvements. Residents approved the recreational facilities changes in a referendum, which will be in place for 21 years.

For a $100,000 home, the preliminary levy increase equates to an increase of $69.01 per year. That equates to $50.50 toward the recreational facilities projects, $15.86 toward the general fund and $2.65 toward other debt levy.

Sixth Ward Councilor Brian Anderson said the city is already seeing improvements in the number and quality of candidates it is receiving with the adjusted wages, and City Manager Ian Rigg said the city is noticing it is losing less candidates to similar jobs nearby.

Rigg said they will continue to monitor temporary staff and seasonal staff to track the benefit.

Councilor Jason Howland clarified that the wage adjustment didn’t include the council, and that the council has not had a raise in several years.

Second Ward Councilor Larry Baker asked if there was any indication what the preliminary levies would be for both Freeborn County and the Albert Lea school district.

Rigg said from what he has heard, everyone has faced certain difficulties and there will likely be increases, though he did not think he could venture to guess an amount.

“No matter how you look at it, no matter how you slice it this year, it’s going to be a big hit,” Baker said.

He noted that the budget committee went through the budget extensively, and he hoped that when it came time to approve the final levy and budget they can cut more.

Councilor Rachel Christensen echoed his thoughts.

The council also approved a $266,000 preliminary levy for the Albert Lea Housing and Redevelopment Authority, which will go to support the Shady Oaks facade project.

The council will vote on the final budget and levy Dec. 9, as well as the 2025-29 capital improvement plan and fee schedule changes.