Canyon staff previews budget that would raise city tax rate to 0.517; public safety staffing cited as main driver

City of Canyon finance staff presented a preliminary 2025 budget at the July 1 City Commission meeting that would raise the city's total tax rate to 0.517, a roughly 26% increase from the 2024 rate, and called for public feedback before the commission makes a final decision.

The proposed rate includes a 5% increase for operations and a much larger increase for debt service tied to new public safety facility debt. Joel Boyer, the city finance director, told commissioners the city's estimates currently use uncertified property values and that the certified values are due within a week; the debt service portion is also subject to change until the debt is issued.

Boyer said the proposed rate would generate roughly $1.4 million more in property-tax revenue next year, about $300,000 of which is earmarked for operations and more than $1 million for debt service linked to public safety facilities. He described a 3% overall increase in the combined operating funds and noted the city has issued more than $24 million in debt for projects, reducing transfers from operations to the CIP fund.

Why it matters: The proposal would raise the typical homeowner's total city bill by about 31% (to $1,003.83 in total payments under the proposed structure), driven largely by the increase in debt service on the tax bill. City staff emphasized that the operational increase was limited to roughly $300,000 and that the debt service increase is driven by projects voters approved in a recent bond election.

Staff highlighted where new spending would go. The draft budget adds three full-time firefighter positions (three hired midyear this year that were funded for six months in the current year), a part-time EMS file-review coordinator estimated at $42,005.58, and the city's share of the SAFER grant match at roughly $57,001.50 for the first year. Public safety was the fastest-growing category in the budget: the police department's line items rose about 7% and the fire department about 19% in Boyer's presentation.

Boyer also walked commissioners through personnel-cost drivers: an 8% increase in total wages, a 13% rise in retirement contribution driven by the actuarial valuation, and a small decrease in health insurance and workers' compensation that together trimmed personnel costs by roughly $100,000. He noted the city plans a 3% merit pool across funds.

Operations and capital details: Boyer said capital outlay payments for the golf fund dropped after the city extended the life of recently purchased lithium-battery golf carts; transfers to CIP have decreased after issuing debt for projects. Two CIP items were in the preliminary budget: Eighth Street sidewalks ($193,897) and a $75,000 transfer for potential land easements.

Commission discussion: Commissioners pressed staff for more information before committing to a final rate. Commissioner Gary (first name provided in the record as Gary) warned that the trend of rising personnel costs is not sustainable and suggested tougher cuts, hiring freezes or smaller merit increases. Commissioner Hector asked questions about the interplay between pay scale changes and the merit pool. Several commissioners asked staff to provide more detailed breakdowns and recommended scheduling an optional work session to allow additional review.

Water, franchise and sales tax notes: Boyer flagged an 8% increase in sales tax revenue projected for next year (about $277,000) and noted franchise taxes are trending down; franchise fee declines were discussed as a risk to revenue that is difficult to reverse without higher natural gas or electricity prices or renewed building activity.

Next steps: Boyer said the city will publish the proposed budget on the city website later this week and asked commissioners to advise what cuts, if any, they want staff to make. Commissioners tentatively agreed to add an optional budget work session at the next meeting to give the commission time to review the packet and follow up with staff.

Ending: No formal budget vote was taken. Boyer repeated that the numbers are estimates until certified property values arrive and that staff will update figures as they become available.