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Five-year financial update shows revenue hit and a projected strain on Fire/EMS fund; council weighs priorities and possible ballot measures
Summary
City finance staff presented revisions to the 2025–29 five-year plan reflecting reduced income tax revenue after a major employer left and planned capital purchases; the combined Fire/EMS fund could run short in the next several years without changes, prompting council discussion of priorities and potential revenue options.
Jeff, the city finance director, told council that the city's five-year plan was revised to reflect a roughly 3.7% reduction in estimated 2025 income-tax receipts compared with 2024 actual collections after the loss of a major employer, along with higher capital and personnel costs.
"We reduced the income tax estimate for 2025 by approximately 3.7% over the 2024 actual," Jeff said, and added that growth was held at an assumed 2.5% per year thereafter. He said staff increased the 2025 budget to reflect property purchases, design costs for Hines Hill Bridge, cleanup costs at the former YDC property, and higher estimated construction costs for the Public Works facility debt service.
Jeff said staff adjusted transfers to other funds to avoid depleting their balances and removed previously projected "excess available for infrastructure expansion" in order to approach a 40% general-fund carryover goal. However, he warned that the general fund ending balance ratio would fall into the upper 30s without further changes and that the combined Fire/EMS fund would decline markedly under the proposed hybrid staffing model: "The fire EMS staffing model is projected to cost an additional 1.1 to $1,200,000 per year," he said.
Councilors discussed options. Councilor Sutton said he opposed reallocating existing income-tax shares to the Fire/EMS fund because that would reduce other funds; he suggested a ballot measure might be needed to fund permanent ongoing operations. Multiple councilors suggested reprioritizing near-term capital projects — for example, delaying or phasing sidewalk work — to preserve fund balance while the council considers longer-term revenue options.
Mayor Molnar and staff said the administration has been conservative in revenue assumptions and has not yet included possible near-term business arrivals in the baseline. Staff also noted that the city's top 30 employers now represent about 26% of the income-tax base, reducing single-employer concentration compared with the past.
Council discussed the hybrid Fire/EMS model's phases. Several councilors supported starting the first phase — 7 a.m. to 7 p.m. weekday coverage with part-time hires — while others said no hires for 24/7 overnight coverage should proceed until a sustainable revenue source is identified. Staff indicated interviews for firefighter candidates could begin and that renovation design for the fire station would take several months; construction would follow.
No formal changes to the five-year plan were adopted at the workshop; council directed staff to provide additional financial analyses, explore financing options for large capital projects (Hines Hill Bridge, YDC), and return with options for balancing the operating and capital priorities.
