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Windcrest finance staff warns of $1.4 million projected shortfall; council given 14 balancing options
Summary
City finance staff presented fiscal 2024–25 performance and a projected $1.4 million shortfall for fiscal 2025–26, citing falling sales tax, higher legal and animal control costs and insurance increases; staff asked council to rank options including a 10% budget cut, tax-rate adjustments, hiring freezes and use of fund balance.
City finance staff presented the fiscal 2024–25 status and a projection showing a potential $1.4 million deficit for fiscal year 2025–26 and outlined 14 options to balance the next-year budget. The presentation attributed the current-year pressure to falling sales-tax revenue, higher legal spending and a spike in animal-control and impound/shelter costs.
Fiscal staff projected revenues “a little bit over $10,500,000” and expenditures of about $11,900,000, creating the roughly $1.4 million gap if no changes are made. The presentation said the city would use about $614,729 of the fund balance in the current year and that, under the projection, unrestricted fund balance would be essentially depleted, leaving approximately $55,000 on hand if no actions are taken.
To close the gap staff proposed 14 options for council consideration: reduce the requested budget by 10% (estimated ~$200,000), adopt the ad valorem de minimis tax rate (staff estimated additional revenue on the order of several hundred thousand dollars once the certified roll is delivered), adopt an unused increment rate, implement a hiring freeze (six full-time positions estimated to save roughly $480,000), sell city property (identified parcel 461 Gulf Crest), amend the animal-boarding contract, cut contracted mowing frequency, use unrestricted fund balance, unrestrict funds previously set aside for the pool, increase transfers from the garbage fund, adjust the TMRS employer/employee match, increase employee health-insurance cost-sharing, terminate the HRA program and freeze the 2% merit pay scale.
Council discussion focused on clarity of projected numbers, the timing to act before the budget workshop and tradeoffs of using fund balance versus structural reductions. Staff asked council members to rank preferences so staff can prepare a balanced budget to file before July 16.
Public-comment connections: several speakers during the citizen comment period raised animal-services concerns and asked for financial records and transparency; the budget presentation directly referenced higher animal-control and vet-boarding costs as a driver of the deficit.
Next steps: staff will present a ranked list of council priorities and prepare a balanced budget ordinance for the council’s review during the scheduled budget workshops. No final budget ordinance or tax-rate action was taken at the meeting.
