A lengthy transportation review at the May 29 budget workshop left aldermen with two clear tasks: correct project worksheet entries that made fund balances look worse than they are, and plan how to cover a projected shortfall if federal and county reimbursements do not arrive in time.

Staff and the public works commissioner discussed three major items: Union Street (a TAP project), First & Osage/Osage SID projects, and Fourth Street improvements. Workshop participants agreed to remove Fourth Street construction revenues and expenditures from the FY26 draft and re‑schedule the work for next year, while retaining Union Street construction on the FY26 project list because that project is already in active procurement and some construction pay‑applications are anticipated.

For Fourth Street, staff removed revenue and construction engineering rows tied to the 2025 work and said engineering expenses would be retained only if paid this fiscal year. For Union Street, staff left construction‑phase entries in place; however, they cautioned that grant reimbursement timing may put pressure on the transportation fund if pay‑apps are fronted without near‑term reimbursement. Staff also flagged a separate engineering request for a Phase‑5 Highway project (line item ~70112 in the draft) where $71,042 was listed as design engineering contingent on a grant award; the board discussed leaving that contingency in the draft but marked it as contingent on grant receipt.

When staff increased a Fourth Street preliminary engineering entry (PE) from a low placeholder to $93,000 to reflect actual anticipated bills, the projected deficit in the transportation fund increased into the mid six‑hundreds of thousands (staff cited a draft shortfall around $655,000 after that change). Aldermen directed staff to zero out the Fourth Street revenue rows and corresponding construction entries (until the project restarts) and to return with an accounting that reflects only projects likely to proceed and known transfer sources.

Aldermen also discussed the Osage SID (special improvement district) receipts and whether an available balance held by the county could be accessed for Union Street or related work; staff said those county funds are available but require a formal request and explanation of the project and expenditures to the county committee that controls distribution. Board members asked staff to prepare any request and to list timing expectations for reimbursements so the board can decide whether to proceed with construction pay‑apps or defer work until reimbursements are confirmed.

The board did not adopt or reallocate funds at the workshop; the discussion closed with staff directed to present corrected transportation worksheets, explicit grant assumptions, and options to reduce or defer projects to produce a balanced FY26 transportation plan.