City officials presented a proposed 2026 budget on Oct. 6 that the administration says balances projected revenue and spending without raising the city’s property-tax rate, but relies heavily on one-time savings and reclassified revenues and leaves several staffing and program questions unresolved.

Zach Jackson, the city’s chief financial officer and controller, said the administration’s general-fund revenue forecast for 2026 is about $144.3 million and the proposed appropriations are roughly the same, producing a small projected surplus. Jackson said the budget relies on $5.2 million of underspent 2025 appropriations, encumbering some capital-lease obligations and using funds that changed category after this year’s state law changes to balance 2026 spending.

“We've proposed a budget that does not require a property tax increase in order to fund our operations for 2026,” Jackson said, adding the plan includes a 3% salary increase for employees but “no COLA for the mayor and senior leadership.” The administration also plans to preserve healthy reserves, with an overall combined balance forecast near 17.6% and a 10% rainy‑day target.

At the department level, Jackson outlined proposed reductions and hiring pauses: unfilled and some filled positions in the mayor’s office and street department, three positions in the fire department proposed for elimination, one police position not being replaced, the executive director of economic development post proposed not to be filled for 2026, and a planned delay to filling the chief information officer role. Jackson said some operational changes—such as consolidating utility-locate work under a single department—are intended to yield recurring efficiencies.

Paving and infrastructure: the budget includes $8.5 million for paving next year: $4.5 million from the motor-vehicle-highway fund, $0.5 million from the local road and street fund and $3.5 million from the wheel-tax and surtax funds.

The mayor’s framing and public input: Mayor Finkham described the budget as disciplined stewardship in a changing fiscal environment after state legislation that affected city revenues. “Carmel isn't in crisis, but like many growing cities, we're navigating real fiscal headwinds,” she said, adding that the administration paused some initiatives, including a proposed Experience Carmel nonprofit shift, to preserve core services.

Public-safety funding and community items: The Carmel Firefighters Union president, Sean Sutton, spoke in support of the fire department’s budget priorities, citing training, hiring needs and increased mental-health support. During council discussion, members also voted to commit $15,000 to Carmel Gazebo Concerts to remove uncertainty for that 2026 program; the motion passed (7 yes, 1 abstain).

Where the budget stands procedurally: The council held a first reading of ordinance D-27-85, the budget appropriation ordinance for 2026, and opened a public hearing. The council closed the hearing and will continue deliberations; no final adoption occurred Oct. 6.

Why it matters: The administration’s approach preserves reserves and core services while using available one-time funds and program shifts to avoid a tax increase. Councilors raised concerns about relying on one-time dollars rather than recurring revenue, the timing of personnel adjustments and transparency about line items moved to other funds; those questions will guide further hearings and potential amendments before final adoption.

Implementation and follow-ups: Jackson said the administration will present more detailed breakdowns on capital leases, department staffing and the items that were moved among funds. Councilors requested additional specificity on program-line items, insurance transfers to the food‑and‑beverage fund, and lists of positions that would or would not be filled in 2026.