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The Austin City Council passed one of its final marks Wednesday night in setting the 2023 budget and tax levy.

At the close of its mandated Truth and Taxation meeting, the City Council unanimously approved resolutions to move forward a tax levy increase of 4.32% and budget of just north of $39.8 million to final approval at its Dec. 19 meeting.

The 4.32% increase will generate just under $8.3 million in revenue for the upcoming year.

The tax levy was dropped by nearly 3 percentage points from an initial increase of 7.05% early in the process to the mark passed Wednesday night.

Director of Administrative Services Tom Dankert laid out the process and broke down where the tax dollars go during Wednesday night’s meeting.

Revenue generated by tax levy dollars is expected to go to the following areas:

• General Fund: $5,743,466
• Capital Improvement: $1,446,000
• Library Fund: $1,053,534
• Port Authority: $40,000

Expected revenue sources for the budget include:

• Intergovernmental Revenue: $10,179,145
• Enterprise Fund Revenue: $10,199,054
• Property taxes: $8,283,000
• Other revenue: $5,897,119
• Internal Service Fund: $5,253,574

Dankert also said that a factor in budget discussions was Local Government Aid money from the state. Minnesota has approved LGA funding for the City of Austin this year at $8,882,778, however, due to inflationary pressures that money doesn’t go as far as it used to.

Dankert pointed to bargaining settlements as an example. Of the eight bargaining units total, the city has approved one so far with wage increases of 4%. Meanwhile, while LGA funding went up this year, it was only 1.4% meaning operating costs are outpacing funding.

The County will hold its Truth and Taxation meeting on Monday night at 6:30 p.m. in the County Commission chambers at the Government Center.

Commissioners will look to take the next step on a proposed tax levy increase of 1.9% and a budget of $63 million.