Dakota County: A difficult 2027 budget and some hard choices ahead
By Joe Atkins | Dakota County Commissioner | September 2026You may have noticed over the years that I don’t shy away from controversial topics or hard conversations. Dakota County’s 2027 budget is definitely one of them.The county board is facing one of the most difficult budgets we have seen in years. Significant state and federal funding reductions, new mandates and cost shifts are arriving at the same time Dakota County is paying more for health insurance, utilities, fuel, technology and other essentials.That is especially frustrating because Dakota County already operates leanly. By a wide margin, we have the lowest county property taxes per resident and the fewest county employees per resident in the Twin Cities metro. Yet we still maintain 1,100 lane miles of roads and 80 bridges, prosecute about 1,800 felony cases each year, operate the Sheriff’s Office and 270-bed jail, answer more than 800 calls to 911 each day, protect vulnerable children and adults, support 22,000 veterans, provide public and mental health services, run 10 libraries, maintain 5,000 acres of parks and much more.
So why are we looking at such large levy increases for 2027? A major reason is that decisions made in Washington and St. Paul are shifting substantial costs and responsibilities to counties. In both cases, elected leaders pursued priorities they had campaigned on, but those decisions also have significant consequences for county budgets.Republicans in Washington delivered significant federal tax reductions, with the Tax Foundation estimating an average federal tax reduction of about $2,272 per filer in 2026. Those changes also came with funding reductions, cost shifts and additional responsibilities for counties.Democrats in Minnesota expanded programs and requirements involving human services, child protection and other parts of the social safety net. Those policies reflected priorities they campaigned on but some of the costs are now falling on counties.Both approaches brought benefits voters were promised. They also shifted millions of dollars in costs onto county budgets.Dakota County currently expects about $21 million in federal cost shifts between 2027 and 2029. The county is also absorbing about $4.3 million in state cost shifts this year, with more expected next year.County Manager Heidi Welsch has presented three potential scenarios:
- A 21.2% levy increase – Adds roughly $167 a year to the county portion of taxes on a median-value $392,100 home. It would still require $5.4 million in spending reductions and roughly 10 fewer positions, including eliminating property tax levy support for county parks.
- An 18.7% levy increase, which is what the county manager is recommending – Adds about $145 a year while requiring $10 million in reductions and roughly 23 fewer positions, including substantial additional cuts to libraries and homelessness prevention.
- A 16.3% levy increase – Adds about $123 a year but requires $14.5 million in reductions, roughly 56 fewer positions and significant cuts affecting public safety, public health, parks and library operating hours.
One important clarification: an increase of 16% -21% in the Dakota County levy does not mean your total property tax bill would increase by 16%-21%. The county makes up only a portion of the overall bill, which also includes your city, school district and other taxing jurisdictions. A 15% increase in the county portion would typically translate into less than a 3% increase in the total property tax bill, although the exact impact varies by property and taxing jurisdiction. Some residents have asked why we cannot simply use reserves. The answer is because we already have.Dakota County reduced its property tax levy in 2021, followed by a 0% levy increase in 2022 and just 1.9% in 2023. Those decisions provided relief, but they also required drawing down reserves. Continuing to rely heavily on reserves is not a realistic long-term solution.Another challenge is that roughly two-thirds of county services are mandated by state or federal law. We cannot simply stop providing those services when outside funding is reduced. As cuts deepen, they therefore fall disproportionately on locally funded services such as libraries, parks, homelessness prevention and veterans’ services.There are no painless choices.The county board will establish the preliminary 2027 levy on September 22. That number can be lowered before final adoption in December but it cannot be increased.We also just received these latest scenarios from the county manager. There is still more information coming, more analysis to do and more feedback to hear before I decide where I land.Would you favor the 21.2% scenario with the smallest service reductions? The county manager’s 18.7% recommendation? The 16.3% option with deeper cuts? Or another combination entirely?I will ultimately cast a vote. I will own that vote and I will explain exactly how I got there.Between now and September 22, I want to hear from as many residents as possible. These decisions deserve a serious discussion, and I intend to keep listening before I cast that vote.
Commissioner Joe Atkins represents South St. Paul, West St. Paul and Inver Grove Heights on the Dakota County Board. He welcomes comments at [email protected] or 651-438-4430.…