Millcreek council reviews conservative 2025–26 budget; $24 million bond for east common proposed

Millcreek, Utah — At a Feb. 28 Millcreek City Council work session, Finance Director Lisa Dudley presented a draft fiscal 2025–26 budget the council described as “conservative,” outlining revenue estimates, a proposed $24 million bond issue to finish the Millcreek East Common project, and departmental changes including a potential GIS staffing conversion and a 3% cost‑of‑living adjustment.

Dudley told the council, “The worksheets that were put out on on the dais for you are laid out in the same, format as they were at our, previous discussion about the budget.” The presentation reviewed general fund revenues and expenditures, special‑revenue funds including the city’s community redevelopment areas (CRAs), capital projects and stormwater funds, and a set of proposed transfers and uses of fund balance.

Why it matters: the draft keeps the city’s operating budget tight while positioning one‑time and dedicated revenues to complete capital work already underway. Council members and staff emphasized cautious revenue recognition and multiple pending decisions this spring, including whether to adopt bond parameters in May to finance East Mill Creek Common construction.

Revenue highlights and treatment of a county sales tax: Mayor (identified only as “Mayor” in the transcript) described a recently approved Salt Lake County local option transportation sales tax, saying, “It's It's a quarter of a percent. And it their their quarter of a percent is divided up 3 ways. Okay? Part of it goes to UTA for transit. Part of it comes to cities that we can use for basically roads.” He and Dudley said the city will not include that distribution in the current budget until exact amounts are known; staff estimated Millcreek’s eventual share at about $753,000 annually and said only a partial year might come in for the current fiscal year. Dudley said the line is currently a placeholder and would be added by budget amendment when distributions begin.

Bond proposal for Millcreek East Common: Dudley and the mayor described proposed bond proceeds of $24,000,000 to complete the east portion of the Millcreek Common. The mayor said the financing would be split into a larger 2025A tax‑exempt series and a smaller taxable 2025B series because some project uses are for profit. He reported that staff have “letters of intent” from a hotel developer, a condominium developer and other property owners and that Lewis Young (Jason Birmingham) is preparing a budgetary report; staff expect to present financing parameters to the council in May and, if approved, to seek bond ratings.

Pavement preservation and fund shifts: Staff proposed moving roughly $1,000,000 in pavement preservation from the capital projects fund (CIP) to the general fund because pavement preservation is a maintenance expense, not a capitalized project. Dudley said that change will create a separate line in Public Works for pavement preservation so the CIP remains focused on capital projects.

Capital projects, CRAs and park impact fees: Dudley outlined five CRA project areas and a newly created aggregate housing fund to set aside the percentage of tax increment for housing required by project documents. She reported the city center CRA currently produces enough tax increment to cover existing debt service and expected payments tied to the Millcreek Common and said staff plan further CRA budget discussion at a future CRA meeting. For phase 2 of the Common, staff proposed using $670,000 in park impact fee balances (impact fees are restricted by state law and must be accounted for) and noted a $3,000,000 beginning balance in the phase‑2 fund that included state COVID‑relief grant proceeds previously received.

Stormwater and federal grants: The stormwater fund draft assumes utility fee revenue (with a 2.3% annual fee increase per the stormwater utility plan) and includes a federal grant for design of a debris basin. Dudley warned timing and reimbursement for the larger construction grant remain uncertain; when asked about risk, she said staff “have not been told no” but are “inquiring about that.” The stormwater worksheet also includes a $250,000 professional‑services line for a storm‑drain master‑plan update, a figure the council asked staff to justify.

Personnel, HR and other changes: The draft includes a 3% COLA and a proposal to convert a GIS intern (identified as Joe) to a funded position; staff said the incremental cost would be small and would be quantified for council review. Dudley noted department heads were asked to identify potential 10% contingency reductions in case of an economic downturn.

Next steps and scheduling: Staff plan to return with a five‑year capital plan, amortization schedules for interfund loans among CRAs, finalized bond financing details from Lewis Young and bond counsel, and any needed fee schedule changes. The mayor indicated a parameters resolution for bond issuance may be considered in May with an informational presentation the week before.

Formal action: The council voted to move into a closed session to discuss pending litigation. Council member Sherry made the motion and Council member Bev seconded it; a roll call recorded “Aye” from Council member Jackson, Marcela Estrini, Council member Desirant and Council member Katten, and the council entered closed session.

The council did not adopt the budget at the Feb. 28 work session; staff said they will return with additional detail and proposed formal actions later in May.