Canby council directs staff to deliver budget meeting 20% reserve target amid debate over cuts and timeline

The Canby City Council on May 21 directed the city administrator to prepare a proposed FY 2025–26 budget that meets a minimum 20% unrestricted general-fund reserve, after extended debate about whether to accept a staff proposal that would lower the reserve to 15% to avoid layoffs.

Councilors and city finance staff spent more than an hour arguing the trade-offs between trimming reserves to preserve staff and maintaining higher contingency to protect city services if revenues fall. City Administrator Eileen said the leadership team "unanimously agreed to recommend strategic cuts and to avoid reductions in force," and asked the council to set the reserve level so staff could return with targeted budget changes.

Why it matters: The council’s decision determines whether staff must generate roughly $678,000 in additional cuts to meet a 20% reserve target that councilors and the budget officer said would align with the Government Finance Officers Association (GFOA) guidance. That number and the choice to tap reserves shaped later votes and follow-up deadlines the council set for the budget committee.

Most important facts

- Staff presentation…