Council adopts FY2026 budget amendment, reduces expenditures to match lower property tax revenue

The City of Sugar Land’s City Council on Oct. 21 approved an ordinance (first and final consideration) to amend the FY2026 general fund budget to align expenditures with revenues after the adopted property tax rate was reduced by roughly 0.4383 cents, which lowered anticipated revenue by about $921,000.

Shelly Steadman, director of budget, presented the amendment and said staff worked with departments to identify reductions with minimal service impacts. Actions included pausing a streetlight conversion project pending analysis, reducing a newly added employee eyeglass benefit based on a lower-than-expected contract cost, scaling back certain IT and People & Culture expenditures (including elimination of a planned benchmark study and a phased discontinuation of a third-party workplace-investigation service), and identifying nine vacant positions across general-fund departments for a total personnel savings of about $914,000. Steadman also noted an $86,000 reduction in municipal utility district (MUD) rebates tied to lower property-tax revenues collected in those districts.

Steadman presented a five-year forecast showing the amended FY2026 budget and outer-year projections; staff said the adjustments preserve a structured balance in forecast years and limit new initiatives while maintaining core services. Council members thanked staff; Finance & Audit Committee members who reviewed the amendment expressed support. Council voted 7-0 to adopt Ordinance No. 2391 amending the FY2026 budget.