Port Orange council hears preliminary capital plan, officials warn grant timing could delay local projects

City officials and staff presented a preliminary Fiscal Year 2025–26 capital improvement plan, capital outlay and fleet requests and told the City Council on a budget workshop night that grant timing and preliminary revenue estimates mean some projects may be pushed into later years or require trade-offs.

The city manager and Mark Simpson, finance director, opened the discussion by stressing that personnel is the city’s largest recurring expense and that capital is the area where the council has most control. “The largest expense in your budget is personnel but you don't have a whole lot of control over personnel,” the city manager said, adding that capital spending is where one-time revenues can be used without creating ongoing obligations.

Staff highlighted the stormwater fund projects as among the most urgent items. Simpson said the stormwater fee generates about $5 million annually and that the city currently holds roughly $5 million in unrestricted stormwater fund balance. “The stormwater fund does have $5,000,000 of unrestricted fund balance,” Simpson said. He and the city manager noted much of the fund’s annual revenue covers operations and equipment and does not by itself pay for large construction projects.

Officials outlined a slate of stormwater and drainage projects, including two large grant-dependent projects (Cambridge and Pepper Hill/Sugar Forest) and a program to replace corrugated metal pipe. Staff said Cambridge is under design and could begin construction in the first quarter of next year; Pepper Hill/Sugar Forest could move to construction in late 2026. Several projects have Transform 360 or other county grant requests pending; if the county funds a project, the county would manage procurement and construction using its own contracting process.

Water and sewer capital also drew attention: Simpson reported an available Water and Sewer Fund balance of about $25 million and that staff would be asking to use roughly $5.4 million of that balance for upcoming utility work, including a multi‑phase wastewater plant upgrade to meet new federal standards and continued lift-station and telemetry upgrades.

On storm-related grant funding, staff explained the city has placed about $11 million of its own funds into FEMA-related programs (acquisition/elevation/demolition projects) that will be reimbursed over time. The reimbursement schedule can span years, staff said, and in some cases the city could borrow against expected reimbursements to accelerate other projects if council chooses.

Fleet replacement requests produced discussion about large, lumpy needs — fire apparatus and specialty vehicles have long lead times and can create spikes in capital requirements. Council members and staff discussed staggering replacement schedules where possible but acknowledged some vehicles must be purchased now and may not arrive for years.

Staff closed by urging the council to consider three options to bridge a projected shortfall: cut capital, cut requested service enhancements, or raise the millage. Simpson and the city manager said they expect to return in July with more complete revenue estimates and that the council will be asked to set a maximum millage rate in August in advance of September budget hearings.

The presentation was a discussion-only item; no formal budget vote or ordinance was taken at the meeting.