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City presents 2026 budget proposal with no property tax increase, offsets with fund balance and BDO lease revenue
Summary
City staff proposed a fiscal 2026 budget that holds property tax rates flat, uses restricted fund balance and higher investment income to balance spending, and lays out how BDO lease revenue will pay debt service and capital projects including Marshall White and the WonderBlock parking structure.
South Ogden City Council staff presented a proposed fiscal year 2026 budget that does not include a property tax rate increase and relies on existing fund balance, higher projected interest income and BDO lease revenue to cover planned spending.
“Almost 64% of the general fund revenues comes through taxes, through sales tax, property tax, and other taxes that are received,” Justin said as he walked council through the revenue mix and the proposed changes for 2026.
The presentation showed a proposed 1.4% increase in total general fund revenues driven by a $795,000 rise in property tax revenue tied to new growth and expiring tax increment districts. Sales tax was held flat in the proposal after two years of elevated pandemic-era collections returned to a slower trend. Staff also proposed increasing the city’s budgeted investment income to reflect stronger returns this year and using $3.5 million of fund balance in 2026 — roughly $2.0 million of that to cover one-time “unused wages” from prior years and $1.6 million from restricted program balances for specific capital matches.
Justin and other staff described transfers and one-time uses the council will consider. The proposal relies on $14.6 million of BDO lease revenue in 2026 to cover existing debt service (including Marshall White), a planned WonderBlock/MBA parking debt service payment, a $500,000 transfer to CBD/20th Street improvements, $121,000 for election costs and other targeted one-time uses such as airport support and refuse truck replacement. Staff said the 2026 BDO uses are projected to leave an available pool for other CIP work after ordinance commitments are met.
Dave and other staff explained a planned amendment to one CRA interlocal agreement that would increase the district’s funding cap and adjust participation rates so more tax-increment pass-through goes to taxing entities in later years. “We’re increasing the budget,” Dave said, adding that without the change the district wouldn’t be able to support new projects.
Staff repeatedly cautioned that several items depend on timing and future council decisions. The proposal includes continuing debt payments for multi-year projects and a planned transfer to the parking and mobility fund to cover the WonderBlock structure’s first-year debt service; staff said operating revenues from parking are expected to help cover that payment once parking is implemented.
Next steps: staff will return with ordinance language to codify BDO/lease revenue uses and with final budget adjustments; the council also will consider a budget opening to address an identified fiscal 2024 allocation issue before adopting the final 2026 budget.
