Topeka officials outline roughly $17 million general-fund gap and weigh sales-tax questions, cuts and hiring freeze

City Manager Josh McInarney told the Topeka City governing body on Jan. 9 that the city faces a projected general-fund shortfall for fiscal 2026 of roughly $17 million and outlined options including department reductions, a hiring freeze, changes to capital projects and up to six separate voter-approved sales-tax questions.

McInarney said the city recorded “about $11 or $12,000,000 surplus in 2023,” then moved into a position where revenue growth has stabilized and personnel and nonpersonnel costs have risen, producing the current projected deficit. He presented revenue and expense drivers — sales tax, property tax, franchise fees, transfers from enterprise funds (“pilots”) and compensation costs — and asked the governing body for direction on which levers to pursue.

The presentation summarized the major revenue trends: inside-city sales tax is 9.35%, with 1% dedicated to the general fund and a separate half-cent for citywide street repairs; sales-tax receipts surged in 2021–22 but have cooled, producing lower-than-projected collections in recent budget cycles. McInarney said 2024 sales-tax receipts were roughly half of a previously projected $6 million increase, leaving an approximately $3 million shortfall compared with that budget assumption. Property valuations that produced near-9% growth in prior years have slowed (2025 growth ~4.54%), and the city is projecting roughly 4%…