On the agenda: Buffalo meeting — Surveillance camera (Oct 19)

BUFFALO CITY COUNCIL WORKSHOP AGENDA
Meeting: MONDAY, OCTOBER 19, 2026
Place: Buffalo City Center
Time: 5:30 PM

1.

BUDGET WORKSHOP #3 – SPECIAL REVENUE & PROPRIETARY
FUNDS

2.

ADJOURN

CITY COUNCIL
AGENDA REPORT

MEETING DATE:
PREPARED BY:
PRESENTED BY:
AGENDA ITEM:

October 19, 2026
Finance Director / Asst. City Administrator Josh Kent
Finance Director / Asst. City Administrator Josh Kent
2027 Budget Workshop #3 – Special Revenue &
Proprietary Funds

BACKGROUND SUMMARY:
The purpose of this workshop is to review and provide guidance on the 2027 Special
Revenue Funds, and the Proprietary Funds Budgets.
Additional meetings/workshops are currently scheduled to discuss and adopt the 2027
property tax levies and budgets.
• October 19, 5:30 pm – Work Session – Special Revenue Funds and
Proprietary Funds Budget (TONIGHT)
• November 17, 5:30 pm –Work Session – Fee Schedule and Rates, and Final
2027 Budget/Tax Levy Discussion
• December 7, 7:00 pm – Public Budget Meeting – Truth in Taxation
• December 21, 7:00 pm – Adopt Final Budgets and Tax Levy
Budget Status:
This work session packet includes an overview of noteworthy 2027 budgetary
items/changes from prior periods, etc., for the City’s Special Revenue and Proprietary
Funds, followed by their Budget Statements. Also included are the respective Capital
Improvement Plan (CIP) drafts.
Special Revenue Funds – 2027 Budgets:
Fire Fund:
Revenues:
• Increased focus on reimbursement grants for fire trainings, and an increase for
services provided to the townships, based on number of calls and estimated
market value (EMV) of properties served. This is to cover both operational
expenses, but also to save up for the purchase of fire engines in the future without
having to take out any debt.

City of Buffalo | 212 Central Ave. | Buffalo, MN 55313

Item
Page | 2

Expenditures:
• Overall expenditure increases of $150,911 or 12%, from 2026
o Personnel Services –
 This increase of $74,163 is based on the rise of hours worked by the
Buffalo Fire Department, plus an increase of the volunteer fire fighter
base rate for the first time since 2022.
o Other Services & Charges –
 The increase of $60,037 is driven by the replacement of radio units
and the increase of their I.T. Allocation.
Library Fund:
Revenues:
• No changes – overall revenue staying flat compared to 2026
Expenditures:
• No major changes – overall expenditure increase of $2,105, or 2%, from 2026
due to the natural increases of personnel expenses that are allocated to the
Library.
Airport Fund:
Revenues:
• Overall revenue increase of $636,488, or 128%, from 2026, due to a larger
FAA/State grant-funded capital purchases.
Expenditures:
• Overall expenditure increase of $640,492, or 132%, from 2026, due to a larger
capital expense for airport snow removal equipment.
Civic Center Fund:
Revenues:
• Overall revenue increase of $140,260, or 11%, from 2026, due to a the
incremental increase of the Civic Center Tax Levy as well as an increase in ice time
fees.
Expenditures:
• Overall expenditure increase of $142,894, or 11%, from 2026
o Personnel Services  Increase due to cost-of-living adjustments, and increased cost of
benefits.
o Other Services & Charges  Driven by increase in property & liability insurance, utilities, and their
I.T. Allocation.
o Capital Outlay  The large items on the CIP for 2027 are to replace the
Dehumidification Unit and the Tube Infrared Heaters in the Purple
Arena as well as purchasing a new Paint Cart.

Item
Page | 3

Fiber Fund:
Revenues:
• Overall revenue decrease of $167,275, or -10%, from 2026, due to a decrease in
the amount of bond proceeds planned for capital projects.
• It is projected that with continued planned buildout, the City will be able to grow
its’ customer base to the point of surpassing the break-even point with operating
expenses in 2027.
Expenditures:
• Overall expenditure decrease of $328,269, or -19%, from 2026, mainly due to the
reduction in the amount of capital projects planned for 2027 as there is a plan to
naturally grow in areas where the Fiber is available and expand the service area
to where electric is performing underground work. This drastically cuts down on
the planned capital outlay expenses as well. Another large decrease to the 2027
Fiber expense budget can be found in the “Other Charges for Services” line, where
their I.T. Allocation has been decreased, as the Fiber Department now handles
most of their I.T. services.
Proprietary Funds – 2027 Budgets:
MIS Fund:
Revenues:
• Overall revenue increase of $250,520, or 16%, from 2026, due to an increase of
software subscription and maintenance charges, as well as increased capital outlay
items. Since this fund is an internal service fund, expenses are covered 100% by
all other reporting funds in the City and Utility Commission.
Expenditures:
• Overall expenditure increase of $250,520, or 16%, from 2026.
o Other Services & Charges:
 Increase of $199,333 due to the uptick in software subscriptions and
ongoing maintenance charges.
o Supplies:
 Decrease of $147,000 because of a sufficient amount of inventory
items on hand.
o Capital Outlay:
 Increase of $165,000 driven by HVAC software, upgrade to existing
outdated cameras at City facilities, and a purchase of a SUV to be
able to safely transport tech items between facilities.
Liquor Fund:
Revenues:
• Overall revenue decrease of $192,044, or -3%, from 2026, due to federal THC
sales regulations.

Item
Page | 4

Expenditures:
• Overall expenditure decrease of $66,075, or -1%, from 2026, again mainly due to
the potential federal regulations of selling THC beverages.
ALIGNMENT WITH CITY COUNCIL STRATEGIC PLAN:

Ensure transparent decision-making, clear communication, and accessibility of staff and
information sources for residents.

FISCAL CONSIDERATIONS:
a. Estimated Cost: $0
b. Funding Source(s): N/A
c. Budgeted: N/A

RECOMMENDED ACTION:

Staff would like to receive guidance from council to move forward with the presented Special
Revenue & Proprietary Funds budgets in preparation for the truth and taxation hearing set for
December 7, 2026.
Back to Agenda

Fire Fund Summary - 2027 Budget
(Proposed)

2027
Budget

2026
Budget

Budget Variance Positive
(Negative)

%
Change

Revenues
Intergovernmental
Charges for Services

$
$

218,000 $
1,126,302 $

193,000
966,521

Total Revenues

$

1,344,302 $

Public Safety
Fire Department
Personnel Services
Other Services & Charges
Supplies
Capital Outlay
Debt Service

$
$
$
$
$

611,694
438,498
206,310
150,000
1,400

$

25,000
159,781

13%
17%

1,159,521

184,781

16%

537,531
378,461
201,000
140,000
-

74,163
60,037
5,310
10,000
1,400

14%
16%
3%
7%
0%

1,256,991

150,911

12%

Expenditures

Total Expenditures
Net Change

$
$
$
$
$

1,407,902
$

(63,600) $

(97,470)

$

33,870

Note - The Fire Fund has sufficient cash reserves to absorb the budgeted decrease in fund balance.

Library Fund Summary - 2027 Budget

2027
Budget

2026
Budget

Budget Variance Positive
(Negative)

%
Change

Revenues
Taxes
Intergovernmental
Miscellaneous

$
$
$

95,000 $
25,000 $
3,500 $

94,999
25,000
3,500

Total Revenues

$

123,500 $

$
$
$

19,580 $
68,620 $
35,300 $

$

1

0%
0%
0%

123,499

1

0%

16,480
69,914
35,000

3,100
(1,294)
300

19%
-2%
1%

121,394

2,106

2%

-

Expenditures
Library
Personnel Services
Other Services & Charges
Supplies
Total Expenditures
Net Change

123,500
$

-

$

2,105

$

(2,105)

Airport Fund Summary - 2027 Budget
(Proposed)

2027
Budget

2026
Budget

Budget Variance Positive
(Negative)

%
Change

$

643,000

1005%

Revenues
Intergovernmental
Charges for Services
Fuel Sales
Hangar Rent
Lot Lease Rent
Private Lot Lease Rent
Miscellaneous
Other Financing Sources
Transfers In

$

707,000 $

64,000

$
$
$
$
$

275,000
73,714
25,214
1,680
250

$
$
$
$
$

290,000
67,440
23,000
1,680
250

(15,000)
6,274
2,214
-

-5%
9%
10%
0%
0%

$

50,000 $

50,000

-

0%

Total Revenues

$

1,132,858 $

496,370

636,488

128%

$
$

81,708 $
101,216 $

94,844
90,542

(13,136)
10,674

-14%
12%

$
$
$

200,000 $
22,250 $
720,000 $

240,000
21,750
37,546

(40,000)
500
682,454

-17%
2%
1818%

484,682

640,492

132%

Expenditures
Airport
Personnel Services
Other Services & Charges
Supplies
Fuel Purchases
Miscellaneous
Capital Outlay
Total Expenditures
Net Change

1,125,174
$

7,684 $

11,688

$

(4,004)

Civic Center Fund Summary - 2027 Budget
(Proposed)

2027
Budget

2026
Budget

Budget Variance Positive
(Negative)

%
Change

Revenues
Taxes
Charges for Services
Miscellaneous
Other Financing Sources
Transfers In

$
$
$

425,000 $
748,700 $
134,060 $

325,000
691,500
151,000

$
$
$

100,000
57,200
(16,940)

31%
8%
-11%

$

100,000 $

100,000

$

-

0%

Total Revenues

$

1,407,760 $

1,267,500

$

140,260

11%

Culture and Recreation
Civic Center
Personnel Services
Other Services & Charges
Supplies
Capital Outlay

$
$
$
$

589,473
393,307
168,980
256,000

524,814
350,052
185,000
205,000

$
$
$
$

64,659
43,255
(16,020)
51,000

12%
12%
-9%
25%

142,894

11%

Expenditures

Total Expenditures
Net Change

$
$
$
$

1,407,760
$

-

1,264,866
$

2,634

$

(2,634)

Fiber Operating Fund Summary - 2027 Budget
(Proposed)

2027
Budget

2026
Budget

Budget Variance Positive
(Negative)

%
Change

Revenues
Operating Revenues
Charges for Services
Active Ethernet
GPON Connection
Other Services
Other Financing Sources
Debt Proceeds

$
$
$

529,368 $
983,112 $
4,000 $

451,974
827,781
4,000

$
$
$

77,394
155,331
-

17%
19%
0%

$

-

$

400,000

$

(400,000)

-100%

Total Revenues

$

1,516,480 $

1,683,755

$

(167,275)

-10%

$
$
$

986,391 $
281,852 $
73,400 $

787,207
435,705
79,000

$
$
$

199,184
(153,853)
(5,600)

$

50,000 $

418,000

$

(368,000)

25%
-35%
-7%
0%
-88%

(328,269)

-19%

Expenditures
Operating Expenses
Personnel Services
Other Services & Charges
Supplies
Non-Operating Expenses
Capital Outlay
Total Expenditures
Net Change

1,391,643
$

124,837 $

1,719,912
(36,157)

$

160,994

MIS Fund Summary - 2027 Budget
(Proposed)

Budget Variance Positive
(Negative)

2027
Budget

2026
Budget

Operating Revenues
Charges for Services

$ 1,837,911.00

$ 1,587,391.00

Total Revenues

$

1,837,911 $

$
$
$
$

465,146.00
787,473.00
66,225.00
56,567.00

$
$

460,000.00
2,500.00

%
Change

Revenues
$

250,520

16%

1,587,391

250,520

16%

$
$
$
$

455,485.00
588,140.00
213,225.00
31,405.00

9,661
199,333
(147,000)
25,162

2%
34%
-69%
80%

$
$

295,000.00
4,136.00

165,000
(1,636)

56%
-40%

1,587,391

250,520

16%

Expenses
Operating Expenses
Personnel Services
Other Services & Charges
Supplies
Depreciation
Non-Operating Expenses
Capital Outlay
Debt Service
Total Expenses
Net Change

1,837,911
$

-

$

-

$

-

Liquor Fund Summary - 2027 Budget
(Proposed)

2027
Budget

2026
Budget

Budget Variance Positive
(Negative)

%
Change

Revenues
Operating Revenues
Sales
Beer
Liquor
Wine
Other Merchandise
Subtotal - Sales
Non-Operating Revenues
Rents & Royalties
Miscellaneous

$

Total Revenues

3,013,516 $
2,720,969
1,041,708
275,158
7,051,351

2,954,939
2,672,442
1,023,668
592,347
7,243,395

46,800
12,533

$

58,577
48,527
18,040
(317,189)
(192,044)

2%
2%
2%
-54%
-3%

46,800
12,557

(24)

0%
0%

7,110,684

7,302,753

(192,068)

-3%

2,374,517
1,863,026
678,534
179,744
5,095,821

2,330,688
1,831,522
667,020
471,828
5,301,058

43,829
31,504
11,514
(292,084)
(205,237)

2%
2%
2%
-62%
-4%

1,112,258
477,884
50,703
48,490

1,064,097
450,685
49,901
48,490

48,160
27,199
802
-

5%
6%
2%
0%

63,000
250,000

250,000

63,000
-

0%
0%

7,098,157

7,164,231

(66,075)

-1%

Expenses
Cost of Goods Sold (COGS)
Beer
Liquor
Wine
Other Merchandise
Subtotal - COGS
Operating Expenses
Personnel Services
Other Services & Charges
Supplies
Depreciation
Non-Operating Expenses
Capital Outlay
Transfers Out
Total Expenses
Net Change

$

12,528 $

138,521

$

(125,993)

City of Buffalo
2027-2036 Capital Improvement Plan
FIRE
Item Description
Grass 11
Engine 22 Replacement
Aerial 21
Refurbish Engine 12
Refurbish Tender 21 if necessary
Replace Expired Air Packs and Tanks
Replace Radios
TOTALS
Funding Sources
Fire Fund
State Aids/Grants - Governmental
Debt Proceeds - Capital Equipment (Governmental)
TOTALS

2027
150,000

2028

2029

2030

2031

2032

2033

2034

2035

2036

TOTAL
150,000
1,500,000
2,500,000
200,000
50,000
350,000
25,000

1,500,000
2,500,000
200,000
50,000
350,000
25,000
175,000
2027
150,000
25,000
-

-

1,500,000

-

2029
600,000
900,000

-

1,500,000

2028

175,000

2030

2031

2032

-

2,700,000

400,000

-

-

-

2033
-

2034
2,700,000
-

2035
400,000
-

-

-

-

-

2,700,000

400,000

-

4,775,000

-

TOTAL
3,850,000
25,000
900,000

-

4,775,000

2036

LIBRARY
Item Description
Library Addition/Remodel
Digital Sign/Message Board

2027

TOTALS

2029

2030
3,500,000

2031

2032

2033

2034

2035

2036

TOTAL
3,500,000
100,000

100,000

TOTALS
Funding Sources
Library Fund
Debt Proceeds - Tax Abatement Governmental

2028

-

100,000

-

2028
100,000

2027

2029

3,500,000
2030

2031

2032

2033

2034

2035

2036

TOTAL
100,000
3,500,000

3,500,000
-

100,000

-

3,500,000

-

-

-

-

-

3,600,000

-

3,600,000

City of Buffalo
2027-2036 Capital Improvement Plan
AIRPORT
Item Description
Snow Removal Equipment
EAST HANGAR AREA DEVELOPMENT ENV. ASSESSMENT
EAST HANGAR AREA DEVELOPMENT LAND ACQ. - 40 AC
EAST HANGAR AREA PARTIAL PARALLEL TAXIWAY DESIGN & CNST.
EAST HANGAR AREA TAXILANE DESIGN & CNST.
EAST HANGAR AREA ENTRANCE ROAD & PARKING LOT DESIGN & CNST.
RWY 18/36, TWY A, & APRON PVMT. REHAB.
RWY 18/36, TWY A, & APRON PVMT. MAINT.
PARALLEL TAXIWAY A RECONSTRUCTION
PARALLEL TAXIWAY A LIGHTING SYSTEM RECONSTRUCTION
APRON RECONSTRUCTION
RUNWAY /TAXIWAY/APRON PAVEMENT MAINTENANCE
TOTALS
FUNDING SOURCES
Airport Fund
Federal Aids/Grants - Governmental
State Aids/Grants - Governmental
TOTALS

2027
720,000

2028

2029

2030

2031

2032

2033

2034

2035

2036

330,000

TOTAL
720,000
100,000
925,000
700,000
400,000
750,000
3,000,000
750,000
1,750,000
825,000
1,200,000
330,000

-

330,000

11,450,000

-

2036
16,500
297,000
16,500

TOTAL
572,500
10,305,000
572,500

-

330,000

11,450,000

100,000
925,000
700,000
400,000
750,000
3,000,000
750,000
1,750,000
825,000
1,200,000

720,000
2027
36,000
648,000
36,000
720,000

100,000

925,000

1,850,000

3,750,000

5,000
90,000
5,000

2029
46,250
832,500
46,250

2030
92,500
1,665,000
92,500

2031
187,500
3,375,000
187,500

100,000

925,000

1,850,000

3,750,000

2028

-

2,575,000

1,200,000

-

2033
128,750
2,317,500
128,750

2034
60,000
1,080,000
60,000

-

2,575,000

1,200,000

2032

2035

City of Buffalo
2027-2036 Capital Improvement Plan
CIVIC CENTER
Item Description
HVAC - Replace DehumidificaƟon Unit - Purple Arena
HVAC - Replace Rooftop Units - Purple Arena
HVAC - Replace Tube Infrared Heaters - Purple Arena
HVAC - Install DehumidificaƟon Unit- Peterson Arena
Refrigeration System Replacement
Forklift
Civic Center Renovation - Phase l
Civic Center Renovation - Phase ll
Concrete Floor Replacement - Purple Arena
Concrete Floor Replacement - Peterson Arena
Dasher Boards Replacement - Purple Arena
Dasher Boards Replacement - Peterson Arena
Parking Lot Pavement
Civic Center Entrance Sign
Event Tables, Chairs, Pipe & Drape
Sprinkler System - Peterson Arena
Bathroom Remodel - Purple Arena
Floor Scrubber
LED Lighting -Purple Arena
E-Ceiling - Peterson Arena
On-Ice Projection Mapping System
Generator
Paint Cart
Ice Edger
TOTALS
FUNDING SOURCES
Civic Center Fund
Debt Proceeds - Governmental
Local Sales Tax (when available)
Insurance Proceeds
TOTALS

2027
165,000

2028

2029

2030

2031

2032

2033

2034

2035

2036

100,000
50,000
1,000,000
2,500,000
25,000
12,000,000
8,000,000
1,250,000
1,250,000
350,000
300,000
600,000
50,000

200,000

200,000

250,000

25,000
200,000
100,000
20,000
30,000
150,000

30,000

100,000
150,000
41,000
15,000
256,000

19,940,000

8,250,000

25,000

200,000

2027
256,000
-

2028
475,000
6,765,000
12,000,000
700,000

2029
250,000
8,000,000
-

2030
25,000

2031
200,000

256,000

19,940,000

8,250,000

25,000

200,000

2032

2033

TOTAL
165,000
100,000
50,000
1,000,000
2,500,000
25,000
12,000,000
8,000,000
1,250,000
1,250,000
350,000
300,000
1,250,000
50,000
25,000
200,000
100,000
50,000
30,000
150,000
100,000
150,000
41,000
15,000

-

200,000

280,000

29,151,000

-

-

2034
-

2035
200,000

2036
280,000

TOTAL
1,686,000
6,765,000
20,000,000
700,000

-

-

-

200,000

280,000

29,151,000

City of Buffalo
2027-2036 Capital Improvement Plan
-

-

-

FIBER
Item Description

2027

Fleet & Equipment
F-250 Pickup 4x4 Super cab Truck
Splicing Trailer

2028

2029

2030

2031

2032

50,000

2033

2034

2035

2036

50,000
40,000

Infrastructure Projects
Fiber Buildout - New Subdivisions & Apartments

100,000

100,000

100,000

100,000

TOTAL
100,000
40,000

400,000

Facilities
Shonhaugen Central Office (HVAC)
Substation Central Office (HVAC)

25,000

25,000
25,000

25,000
Projects

South Shores Development Area
Industrial Park
WCGC Development Area

50,000
400,000
125,000

50,000
400,000
125,000
ISP Data Center

Servers & Storage
E7 Package - Shelf & Card/s
E9 Package - Shelf & Card/s
Firewall
TOTALS
Funding Sources
Fiber Fund
TOTALS

250,000
80,500
50,000
25,000

250,000
25,000

27,500

28,000

50,000
25,000
50,000

475,000

125,000

475,000

100,000

27,500

150,000

2027
50,000

2028
475,000

2029
125,000

2030
475,000

2031
100,000

2032
27,500

2033
150,000

50,000

475,000

125,000

475,000

100,000

27,500

150,000

-

128,000

40,000

1,570,500

-

2035
128,000

2036
40,000

TOTAL
1,570,500

-

128,000

40,000

1,570,500

2034

City of Buffalo
2027-2036 Capital Improvement Plan
MIS
Item Description

2027

2028

2029

2030

2031

2032

2033

2034

2035

2036

TOTAL

Vehicles
SUV

25,000

Hardware
Networking Equipment (Cisco Router, Cisco Switch, Server Domain Controller,
Router, Wireless Access Points)
Core Router Replacement
AWS Cisco Switch (Qty 3) City Center/Sub Station
Access level switch replacement
Surveillance camera upgrade
Surveillance camera new
Replacement Domain Controller - Sub Station
ESX/SAN (Qty 2)
PC Refresh
Firewall Upgrades

25,000

250,000
40,000
50,000
70,000
15,000
10,000

40,000
50,000
15,000

50,000
15,000

50,000

50,000
50,000

15,000
20,000

60,000

60,000

60,000

60,000

75,000

75,000

75,000
25,000

80,000

100,000
80,000
20,000

10,000
50,000

10,000

20,000

10,000

10,000

20,000

10,000

10,000

20,000

250,000
40,000
40,000
250,000
120,000
60,000
30,000
100,000
625,000
45,000

Security
Security & Vulnerability Testing
Shadow AI
Software
ERP Software - Incode
Work Order Management
HVAC Software
Active Directory Mgmt.
Baracuda AI Security
Data Software - Varonis - compliance analysis & stale data
TOTALS
FUNDING SOURCES
MIS Fund
TOTALS

10,000

350,000

130,000
50,000

350,000
150,000
100,000
15,000
15,000
50,000

150,000
100,000
15,000
15,000
50,000
460,000

525,000

145,000

85,000

235,000

345,000

160,000

140,000

320,000

30,000

2,445,000

2027
460,000

2028
525,000

2029
145,000

2030
85,000

2031
235,000

2032
345,000

2033
160,000

2034
140,000

2035
320,000

2036
30,000

460,000

525,000

145,000

85,000

235,000

345,000

160,000

140,000

320,000

30,000

TOTAL
2,445,000
2,445,000

City of Buffalo
2027-2036 Capital Improvement Plan
HIGHWAY LIQUOR - BUFFALO WINE & SPIRITS
Item Description
Walk-in Coolers
Replace Liquor Store Delivery Vehicle
Roof Replacement
Main Entrance Doors
New Liquor Store Building - Design/Engineering
New Liquor Store Building - Construction
TOTAL
Funding Sources
Liquor Fund
Debt Proceeds - Enterprise
TOTALS

2027

2028

2029

2030

2031

2032

2033

2034

2035

2036

TOTAL

-

30,000
33,000
5,000,000
5,063,000

-

TOTAL
33,000
5,030,000
5,063,000

30,000
33,000
5,000,000
33,000
2027
33,000
33,000

5,030,000
2028

2029

2030

5,030,000

-

5,030,000

-

2031

-

2032

-

2033

-

2034

-

2035

-

2036

-

DOWNTOWN LIQUOR - DOWNTOWN WINE & SPIRITS
Item Description
Replace HVAC RTUs - Tenant Space
Main Entrance Doors
Replacement of Back door
Reconfigure Dumpster Area
TOTAL

2027

30,000

15,000

FUNDING SOURCES
Liquor Fund

2027
30,000

2028
15,000

30,000

15,000

TOTALS

2028

2029

2030

2031

2032

2033

2034

2035

2036

TOTAL
-

30,000
15,000
2029

2030

2031

2032

2033

2034

2035

2036

TOTAL
45,000

-

-

-

-

-

-

-

-

-

45,000