City staff recommended that the council program the voter-approval tax rate for the fiscal 2026 budget and invited council feedback on whether to use a one-year unused prior-year increment to fund street work. Finance staff presented three rate options — the no-new-revenue rate, the voter-approval rate and the voter-approval rate plus an unused increment — and walked council through estimated revenue and homeowner impacts.

The recommendation came at a council workshop where staff said the voter-approval rate (the middle option presented) would be the basis of the proposed budget unless council directs otherwise. “Your voter approval rate is 0.5717881,” finance staff said. Staff noted that the currently adopted city rate is 0.5732 and that the voter-approval-plus-unused increment option would raise the rate to about 0.6136011 for one year.

The difference in those choices matters for general-fund revenue and for homeowners. Staff presented estimated tax collections and said the average home value in tax year 2025 is $178,838; the city’s portion of property tax on that average home would be about $1,022.57 under the proposal — roughly $21.53 more than last year. Staff also said the no-new-revenue rate leads to a small decrease in the rate but still produces additional revenue because the taxable digest grew.

Staff told council the unused prior-year increment — roughly four cents in the example presented — should be treated as a one-time source and recommended that, if council approves using it, the entire increment be dedicated to the city’s street capital-improvement program rather than to ongoing operations. Staff estimated combining the unused increment with budgeted street programming would yield roughly $1.4 million to $1.5 million for street work next year.

Council was asked to set two public hearings and take a roll-call vote to publish the proposed tax rate and budget hearing notice on Aug. 19; staff said the council can adopt a final rate in September after the public process required under state truth-in-taxation rules. Staff emphasized the difference between the statutory calculations — the no-new-revenue calculation, the voter-approval calculation (3.5 percent rate-of-increase framework), and capturing unused prior‑year increments for a single year.

Staff asked council for direction but did not present a final adopted rate at the workshop. A formal vote on a proposed rate and a public hearing date was scheduled for the regular meeting agenda on Aug. 19; adoption of a final tax rate will occur later in September after the required public-notice steps.