Ferguson city leaders on Tuesday reviewed the proposed 2025–26 budget and heard staff say the general fund faces a near-term shortfall driven by a large settlement and other costs. The city manager and finance director told the council the draft projects roughly $17.5 million in general fund revenue against higher expenses, leaving a forecasted deficit after litigation and one-time items.

Why it matters: Council members said the city must find savings before adopting the budget to avoid eroding reserves and to preserve services such as pool hours and community programs. Council members pressed department heads to identify nonessential items to trim and asked staff to compile proposed cuts for the council to consider before the next meeting.

Details: Finance staff told the council they were forecasting a roughly $1.5 million deficit that shrinks when a one-time settlement of about $2 million is removed from this year’s outlays. The draft budget shows revenue increases in part from property valuation and late lien collections, but also a number of expense pressures including public safety training, software and contracted audits.

Council response: After a lengthy discussion about department travel, memberships, and discretionary spending, the council moved to remove $5,000 for a council retreat and approved that motion. Council members asked the city manager to collect written recommended cuts from councilors by Friday, and to compile them into a single spreadsheet for review before the next session.

Next steps: Department heads were asked to return prioritized lists of potential reductions and to identify items that would harm core services if cut. The council will vote on ordinance and line-item changes in later budget sessions.