NORTH MANKATO — As cities across Minnesota begin the process of constructing 2010 budgets, North Mankato Councilwoman Diane Norland had some advice.

“Bring Kleenexes,” Norland suggested when the City Council agreed to its long list of budget meetings.

The trouble is the same as most people and organizations in the midst of the worst financial crisis in more than six decades: revenue is dropping, expenses aren’t.

North Mankato, for instance, is facing a nearly $500,000 cut in its Local Government Aid for 2010 — a 9 percent reduction in state aid. The city’s only other major source of revenue for its general fund is property taxes, and the council found out last year that residents are in no mood for tax increases.

It adds up to a late summer and fall of tough choices for members of city councils. For Norland, it also added up to a bit of inspiration.

“We need a permit to serve liquor at council meetings if we’re going to do this,” she said, looking at the proposed budget calendar.

When the budget meetings began last week, the drinks available seemed to be the traditional options of water, coffee and pop. The choices facing the council in coming months are tax and fee increases and cuts in spending.

North Mankato City Administrator Wendell Sande said the city will have the legal authority of raising taxes about $474,000 to make up for state aid cuts made in 2008 and 2009. State law will also allow for additional property tax increases due to the city’s population growth and — to a small degree — for inflation.

But legally allowable tax increases aren’t always politically acceptable. After years of little or no opposition to proposed levy hikes at annual Truth in Taxation hearings — the state-mandated public meetings held in December before final taxing decisions are made — the North Mankato City Council faced a half-dozen residents, several of them imploring the council to ease up.

“I’m dead-set against this thing,” Covington Lane resident Mike Hatfield said of the city’s proposed 5.9 percent property tax increase. “It’s absolutely ridiculous.”

State law doesn’t technically require cities to publicize Truth in Taxation hearings this year, including state-mandated budget numbers. But statements will be sent out to property owners in November listing the time and date of December budget meetings by cities, counties and school districts, along with preliminary proposed tax increases.

And North Mankato will still give its traditional budget presentation on Dec. 7 and take public comments on the proposed tax increase, with final decisions made on the property tax levy on Dec. 21, Sande said.

It’s actually a better idea, however, for residents to get involved much earlier if they want to impact the budget — whether to argue against property tax hikes or in favor of protecting certain spending areas from cuts.

“September is probably a good month for input,” Sande said.

By Sept. 8, the city will have heard the budget requests from department heads ranging from the police chief to the director of parks and will receive the administration’s budget proposal from Sande and Finance Director Steve Mork. On Sept. 15, the council’s preliminary tax levy is due — a taxing level that can be lowered as budget discussions continue but can’t be exceeded.

Upcoming budget discussions are scheduled for Aug. 17, Sept. 8 and 15, Oct. 5 and 19, and Nov. 16.