Finance director previews 2026 revenue outlook, proposes slight mill-levy decrease

City finance staff presented a high-level preview of the proposed 2026 revenue picture and recommended a modest reduction in the city mill levy to preserve services while reflecting assessed-value changes.

The finance director told the council the general fund’s main revenue sources for the proposed 2026 budget are sales tax (about 54%), property tax (about 28%) and community-center receipts (about 7%). Staff estimated roughly $26 million in general‑fund revenue for 2026 and proposed reducing the mill levy from 26.665 by 0.25 mills as a starting point for council discussion.

Nut graf: Staff emphasized the presentation was a revenue preview, not a final budget. The official revenue-neutral rate is determined by Johnson County and was expected to be delivered to the city on or about June 13; staff said they will update the council with that number before finalizing any mill-levy decision.

Staff provided household context: the median Merriam home value used in the presentation was about $310,000; under staff’s assumptions the representative homeowner would see a roughly $1 monthly decrease compared with maintaining the prior mill levy, though staff cautioned that the outcome depends on next year’s assessed values.

Council members asked for explanations of line-item shifts. Staff said commercial assessed value showed an unexpected decrease in one category and that staff had requested detail from the county assessor to explain changes. The finance director said staff budgets conservatively for sales tax (about 10% headroom) and will return with more detailed revenue and expenditure projections.

Ending: Staff will update the council when the county issues the revenue-neutral rate and will present a more detailed proposed budget and expenditure plan in the coming weeks.