Tompkins County administration told the Tompkins County Council of Governments that preliminary submissions for the 2026 budget show tight margins, a lowered fund balance after allocations to reserves, and a projected budget shortfall that will require either higher revenues or spending reductions.

Why it matters: The county’s fund-balance target and the 2026 tax-levy cap constrain options for new programs, including any expansion of county services that require ongoing funding.

County administration briefed TCOG on the numbers: the modified 2025 budget was described as roughly $236 million; projected revenues and tax-levy calculations were reviewed and administration said net new submissions total about $11 million (net cost after projected revenue), producing a preliminary deficit scenario if no other adjustments are made. Administration reported an adjusted fund balance of about $44.1 million after prior-year transfers into reserves; the county’s policy target at 25% (roughly $60.5 million by administration’s numbers) would leave a shortfall.

Administration noted the current statutory or policy tax-cap calculation equates to roughly a 2.7% levy limit for 2026 given prior adjustments and last year’s increase, and said each 1% of tax levy equals roughly $549,000 in revenue. Administration described the options the county will review in the next three weeks: reduce some expenditure projections, increase revenue projections where justified, or recommend a higher levy for consideration by the legislature.

During Q&A, TCOG members pressed on use of fund balance: county administration confirmed that the 2024 fiscal year ended with net reductions to the fund balance, that some funds were moved into reserves for capital and debt stabilization, and that drawing down fund balance to cover recurring needs is not a sustainable long-term strategy. A legislator asked whether the county’s assigned reserves were a recurring set-aside; administration said last year’s transfers — about $19 million total into various reserves — reflected policy choices for capital, debt stabilization and self-insurance rather than a fixed annual formula.

What’s next: County staff will continue departmental reviews and return recommended adjustments to the legislature; TCOG members were urged to expect a three-week review period before administration prepares a recommended proposed budget for legislative consideration.