Portsmouth council affirms $1.24 tax rate, advances FY2026 budget items and orders tighter vetting of civic grants

City staff summarized the package of ordinances the council will consider to adopt the fiscal year 2026 operating budget and capital improvement plan at the May 13 meeting and said the council had reached consensus the previous evening to set the real‑property tax rate at $1.24.

Budget officer Mister Burke reviewed the items: an ordinance to set general fund rates and fees (which includes the real‑property tax rate), ordinances setting utility and EMS fees, the Community Development Block Grant (CDBG) annual action plan, the fiscal year 2026 pay and classification plan, the capital improvement plan and the operating budget for Portsmouth Public Schools. Burke said the city’s contribution to Portsmouth Public Schools had been increased by $1,500,000 to a total of $82,878,325 in the package before council.

Council discussion focused on the tax‑rate mechanics and future fiscal uncertainty. Several council members reiterated the consensus to adopt the $1.24 rate rather than a $1.30 rate with a 6‑cent tax credit. Councilman Hugo urged the council to "leave the budget alone" and keep the $1.24 rate agreed to overnight, while Vice Mayor Moody warned against changing course after a unanimous decision the prior night.

Council also debated late additions to the civic‑organization funding list in the draft budget, specifically a $10,000 line item for the Mann Foundation to support programming (Complete the Puzzle/Police Athletic League were also mentioned as funded items). Vice Mayor Moody and others urged that organizations seeking city funds follow the established Community and Regional Organization (CRO) grant application process; Councilwoman Thomas and others said the council should apply funding rules and deadlines consistently.

Staff described the CRO cycle: solicitations typically open in November–December and close in January–February; applications are evaluated on service merit and whether the service is required. Council asked that organizations that would receive more than $10,000 be invited to present to council during vetting; staff said grantees will still be required to enter contracts and provide performance reporting before funds are dispersed.

Questions about conflicts were raised when a school‑board member is affiliated with the Mann Foundation. The mayor said the school board’s attorney provided an opinion clearing that particular school‑board member of a conflict for the city funding item because the funding does not create a school contract or payroll relationship.

City staff said a revised set of ordinances reflecting the $1.24 rate had been posted online and would be the documents used for the formal vote. Council signaled consensus to withdraw the ordinance that would have established the $1.30 rate with a 6‑cent tax credit and proceed with the $1.24 rate and the revised budget package. Staff will continue vetting nonprofit funding requests and return to council with contracts and performance requirements before funds are released.