Lake Forest council approves comprehensive fiscal plan for fiscal 2026

The Lake Forest City Council on April 21 approved the city's comprehensive fiscal plan for fiscal year 2026, voting 8-0 to adopt the operating and capital budgets, five-year capital improvement program and associated financial policies.

The plan projects citywide revenues of about $143 million and expenses of about $144 million for fiscal 2026; the gap reflects a one-time transfer from an estimated fiscal 2025 surplus into the capital improvement fund to help finance the planned police facility. Diane Hall, interim finance director, told the council the city is projecting a $3,190,000 surplus in the general fund for fiscal 2025 and recommends holding that balance and transferring the excess into capital in fiscal 2026.

"Our comprehensive fiscal plan is more than just a budget," Hall said in presenting the plan, adding it "incorporates many different aspects besides just the numbers," including the strategic plan, performance measures and five-year forecasts. Hall identified the new police facility as the largest single capital item in the near term, estimated at $25,000,000 in the CIP.

Council members emphasized the advantages of conservative budgeting and the uncertainty of external revenue streams. Alderman Gashkarian warned about dependence on state and federal funding and long-term pension liabilities, urging future councils to maintain fiscal restraint. The mayor and other aldermen noted the city's strong balance sheet and said the transfer from the FY25 surplus keeps the fund balance in policy range while advancing capital priorities.

The council recorded the motion and carried it by roll call vote with all eight aldermen present voting yes.

The approved package also includes updated personnel policies and the fiscal-year-2026 pay plan, adjustments to operating department budgets to reflect compensation changes, and an additional $150,000 added to a fire department public-safety building renovation project.

The city will post the adopted comprehensive fiscal plan and related documents on the city website; Hall said the document had been available to council and the public since April 14 and staff will continue to monitor revenues and costs through the fiscal year.

Less critical details: the five-year capital program shows roughly $110 million of capital projects in current dollars across the five-year window with about 13% projected to be grant-funded; staff used conservative assumptions for revenue and a 3% escalation in long-term planning for capital-replacement targets.