Edmonton taxpayers will be paying more for property taxes next year, but not as much as originally planned.

The proposed increase has been reduced from 3.1 per cent to 2.85 per cent after city council met Friday to review requests for discretionary funding set aside for new projects.

Council also looked at what to do with a $28-million-and-rising surplus for 2016, mostly due to savings on snow removal this year.

The increase would mean an additional $66 a year in property taxes for the typical Edmonton home.

"We're about where I hoped we would be which is under three but still with funding for things that are about jobs and economic growth," said Mayor Don Iveson.

"We had to make some very difficult choices in this budget, as families and businesses are having to do right now, and so there are certainly some things on the cutting room floor today which is to be expected."

Failing to make the cut for funding was the Nuit Blanche visual arts festival, which attracted 50,000 people in its first year last winter.

Coun. Ben Henderson was disappointed by that decision.

"I think Nuit Blanche represents the kind of things that attract people to our city and create the kind of urban exciting place they want to live in and why they want to choose Edmonton to be their home," he said.

"I think we're being naive if we can think we can pull back on those things without there being consequences."

'Missed opportunity'

The Edmonton Museum also failed to persuade council for a quarter of a million dollars in funding to move beyond being a pilot project.

Beth Sanders is with the Edmonton Heritage Council which is spearheading the museum.

She told council the museum has a number of sponsors lined up but nothing can be finalized until the city commits.

She called the decision not to fund the museum a "significant missed opportunity."

"Fort Edmonton is the closest thing we have in Edmonton and it costs $100 for a family of four to go to Fort Edmonton and the story stops at 1929," she said.

"There's a lot more to be made explicit in Edmonton about who we are as a people."

Council agreed to give End Poverty Edmonton, a task force working to end poverty in Edmonton within a generation, $1.265 million next year with another $1.178 million in 2018.

The Industrial Action plan, which hopes to create jobs northeast of the city, was also a big winner with over $1 million in the next two years.

After being turned down last year, the Art Gallery of Alberta also came out ahead with another $250,000 which it plans to use to offer more free admission days.

Council will finalize the budget and the property tax increase on Tuesday.