City staff presented Longmont’s proposed 2026 budget to the City Council on Aug. 26, describing an all‑funds proposal of roughly $520.2 million and a conservative revenue outlook that uses some fund balance to maintain services while keeping tax rates unchanged.

The city manager told council that use tax, a major revenue source tied to construction activity, had fallen sharply earlier in 2025 and was a major budgetary headwind; staff noted use tax was down about 21% year‑to‑date and that the lumber category explained a large portion of the decline. Because municipal budgets generally rely on growth, staff emphasized a cautious approach: the proposed budget holds sales and use tax estimates broadly flat and uses a combination of fund balance and targeted program adjustments rather than new taxes to balance 2026.

Key figures and policy points presented by staff:
- Proposed all‑funds budget: roughly $520.2 million (presented as a 9.85% increase over 2025 in the packet).
- The general fund proposed revenues were shown near $124 million with expenditures around $131 million; the proposal included a plan to use fund balance to support one‑time capital and other needs.
- The city’s stabilization and reserve structure is intended to provide flexibility; the proposed general fund reserve in the budget was cited at about 20.6% (staff’s stated goal range is roughly 17–22%).
- No property‑tax or sales‑tax rate increases were proposed for 2026 in this presentation.
- The budget includes ongoing priorities: market‑competitive compensation (staff proposed an overall market pay posture at about 101% of market in this cycle), infrastructure investment (notably street reconstruction and transportation capital), and an IT fund to centralize technology costs and to fund enterprise digital projects (including a SalesForce implementation and a proposed OpenCounter permitting tool).

Staff also described expenditure pressures: collective bargaining/catch‑up pay in public safety, rising costs for capital projects and materials, and uncertainties from state legislative changes and potential unfunded mandates. Specific operational notes included an adopted water rate increase and an ongoing franchise‑fee alignment for NextLight (the city’s municipal broadband utility) that will move franchise fees closer to parity with other utilities.

Council asked for further detail on multiple topics. Staff scheduled deeper budget work sessions in September; the council set a calendar for public hearings, budget deliberations and follow‑up: the city manager must present the proposed budget before Sept. 1 and council will consider detailed hearings and budget adoption steps across September and October. Several members asked staff to include a fuller airport fund presentation and clarified they want materials distributed ahead of follow‑up meetings.

What’s next: Staff will provide detailed fund‑by‑fund materials and bring the general fund and public‑safety fund detail back to council in the first budget review sessions in September, with additional sessions scheduled for the month before adoption.