Terre Haute mayor unveils $127.8 million 2026 budget, cites casino revenue and reserves to cushion policy changes

Mayor (name not specified) presented the proposed 2026 City of Terre Haute operating budget to the city council on Sept. 24, saying revenue is projected at $127,800,000 and that casino wagering funds will cover many one‑time projects and help avoid a new local wheel tax for now.

The budget “consists of 35 total funds,” the mayor said, including 27 general operating funds, one enterprise fund for the wastewater treatment plant and seven redevelopment funds. He told the council he projects casino wagering revenue of roughly $9 million in 2026 and said the administration will budget only two‑thirds of casino dollars and keep one‑third as a reserve.

That reserve strategy, the mayor said, is intended to blunt future effects of state policy changes referred to in the meeting as “Senate Enrollment Act 1,” which the administration expects will reduce local revenue growth in the coming years. “Due to the upcoming impacts of Senate Enrollment Act 1 ... it’s best to be conservative in our revenue projections,” he said.

Key elements of the proposal:

- Revenue and reserves: The administration presented total projected city revenue of $127.8 million (redevelopment revenue excluded) and said miscellaneous non‑property revenues make up about $90.5 million of that figure. Property‑tax revenue in the presentation was shown at about $28 million.

- Casino dollars and three “buckets”: The mayor described three streams tied to the casino — (1) wagering and supplemental wagering tax revenue that largely flows to the city; (2) a private casino foundation that will make grants; and (3) property‑tax receipts generated inside a TIF district, which were used as the basis for a $22 million bond to fund infrastructure around the casino site.

- Capital and one‑time projects: The proposal relies heavily on casino and redevelopment funds for near‑term capital work. The Deming Park pool and YMCA projects were highlighted: the mayor said about $2.2 million will be spent this year on the Deming Park Pool project with $1.15 million budgeted in 2026, and the YMCA line is $750,000 in the 2026 proposal (the administration said it will reduce the YMCA allocation in 2027). Sidewalk funding was shown rising to a total of $900,000 and road paving at $3,850,000 for 2026, with $250,000 set aside for pavement preservation pilot work.

- Sanitary/wastewater and EPA long‑term control plan (LTCP): The mayor said the city’s LTCP for combined sewer/stormwater projects has been approved and that designs for projects (Ohio Street, Chamberlain Road, main lift station, Seeleyville interceptor, Lincolnshire, Woodshire drainage and Locust Street) will have construction estimates in February 2026. He warned that if estimates match expectations, the city will need to consider a “fixed flat increase” in sanitary rates to meet federal mandates; if estimates are lower, cash balances could delay a rate increase. “I personally do believe in the science behind the EPA’s long term control plan,” he said.

- Personnel and pay: The proposed budget includes a 3% raise for non‑union employees and a public‑safety contract the administration described as front‑loaded (an 18% increase in year one with 0% increases in years two and three for base pay). The mayor said the proposed police base pay would increase from approximately $58,000 to $68,000. He also noted upward pressure on city expenses from higher employer pension contribution rates.

- Pensions and state policy: The mayor flagged recent increases in required pension contributions and said that change is already a substantial cost to the tax base. He described ongoing conversations with state officials about pension funding and long‑term solutions.

- Use of cash balances: The administration said it has used cash balances in the sanitary district and other accounts to complete certain projects without immediate rate increases and that early payoff of leases with casino funds is expected to save about $200,000 in interest costs.

Council discussion focused on the casino revenue assumptions, whether to adopt a local wheel tax tied to House Bill 1461 (the mayor recommended waiting for direct‑disbursement projections before asking residents to pay a wheel tax), the composition of casino funds and the risks of relying on one source of revenue. Council members asked for more detail on specific lines (demolition, paving and civic promotions) and the mayor reviewed how casino funds are budgeted across multiple accounts.

The mayor and council also confirmed administrative next steps: the council will vote on salary ordinances and the general fund budget at its Oct. 2 regular meeting and vote on the sanitary budget at the Oct. 9 regular meeting. The mayor said he will provide an updated five‑year projection after the budget passes and intends to send a paving schedule to council members in December.

Ending: The council accepted the schedule and the meeting concluded with adjournment motions. The administration left council with the binder and slide deck used in the presentation and with direction to return with updated figures and planned project estimates as design bids and state recertifications are completed.