City Manager Grabowski and Finance Director Christina Coyle introduced the City of Elmhurst’s proposed fiscal year 2026 operating budget to the City Council Committee of the Whole on Oct. 6, describing a $274 million citywide budget and a general fund that will be under pressure next year.

“The greatest challenge for the city as we move into 2026 is positioning the city's general fund for the future,” City Manager Grabowski said, describing a mix of higher recurring costs and the exhaustion of one-time federal stimulus money that had previously bolstered reserves.

Why it matters: the proposed budget maintains the city’s 25% fund-balance policy but relies on a combination of department reductions and revenue enhancements to do so. The transmittal materials show total city revenues of $274,000,000 and proposed expenditures of $273,000,000; the capital program accounts for $113,300,000 of the proposed spending. The general fund revenue line is $121,900,000 with general-fund expenditures budgeted at $127,400,000. City staff said the apparent revenue jump for 2026 is driven by debt proceeds for capital projects and the creation of a new internal fleet fund and that, when those 1‑time items are excluded, net operating revenue growth is modest.

City officials pointed to three drivers of the general-fund pressure: an anticipated $1,000,000 increase in the city’s health insurance costs, a $645,000 increase in required pension contributions, and the end of roughly $8,800,000 in federal CARES/ARPA stimulus funding that had been used to stabilize the fund in prior years. Director Coyle told the committee that stimulus funds were exhausted in 2024 and that the city has been drawing down fund balance to remain within policy limits.

The proposed levy in the recommended budget includes a $1,000,000 increase to the corporate levy that staff said is intended to offset insurance and pension cost increases and help maintain the 25% fund-balance policy. Director Coyle explained the city’s share represents about 7 cents of every property tax dollar for Elmhurst taxpayers and noted that the city ranks among the lower property-tax rates in DuPage County when comparisons are adjusted for service differences.

The council’s next steps: the finance committee will review the levy in coming weeks and the council must act on any levy changes by mid-December if it intends to implement a property-tax increase for 2026. Manager Grabowski emphasized that specific cuts or alternative revenues have not yet been adopted and that the budget deliberation process will continue.

Discussion vs. action: the meeting was a presentation and Q&A; no final budget vote or formal levy adoption occurred during the session. Council members asked for clarifications about how the police station bond proceeds and the creation of the central fleet fund affect year-to-year comparisons, and staff noted that budget-to-budget comparisons require excluding several one‑time items to see underlying operating trends.

Looking ahead: staff warned that absent revenue increases or additional cuts, the general fund could approach the city’s lower reserve threshold and that the finance committee will examine options over the next two months.