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Commerce City council directs staff to analyze five operating funding priorities as draft budget projects $2.8M deficit
Summary
Council asked staff to return with options on public safety, derby, public works, retail development and economic development after a preliminary 2026 budget showed a projected $2.8 million general-fund shortfall. An amendment to add "primary employment" as a separate priority failed 3–5.
Commerce City officials directed the city manager on July 21 to analyze and return to the council with staff recommendations on five proposed operating funding priorities for the 2026 budget: public safety, Derby (economic event/initiative), public works, retail development and economic development. The action follows staff presentations that showed preliminary 2026 budget projections and a projected $2.8 million general-fund deficit.
The council’s motion to have staff analyze capacity and capability needs for those five priorities carried after a second and roll-call; council members agreed staff should present the analysis at the Sept. 8 budget workshop. Council member Chris Johnson (Finance) told the council during the presentation that, “we're projecting a $2,800,000 deficit for the general fund,” and staff framed the figure as a conservative projection prepared before any requested budget enhancements.
Why it matters: The general fund supports day-to-day services such as police, streets and parks. Citywide sales and use taxes — the city’s main revenue source — have been strong but show signs of slowing, and staff noted a decline in construction permits compared with earlier years. Council members said they want analysis that links proposed increases in staff or programs to measurable outcomes.
What the council directed staff to analyze - The motion asks the city manager to return to the Sept. 8 budget workshop with findings and recommendations that include the additional details discussed at the July 28 study session for each of the five priorities. That analysis is to cover potential staffing, program changes and budget implications.
Amendment failed on primary employment - Mayor Pro Tem Tim Noble proposed an amendment to add “primary employment” as a separate sixth priority. Staff and several council members said primary employment objectives are largely part of economic development work and would require more detailed policy discussion to identify target industry clusters and incentives. The amendment failed on a 3–5 vote.
Budget context and drivers - Staff reported sales and use tax remain the largest single revenue source, and that the city outperformed the 2024 sales-tax budget. However, use-tax receipts tied to construction and one-time audit collections are lower than in the anomalous 2021 period, and permitting for residential and nonresidential projects has slowed compared with earlier years. Those trends affect longer-term revenue forecasting. - Finance presentations identified internal service fund allocations (IT, facilities and fleet), salary and benefit growth, and planned transfers to the capital program as principal expenditure pressures.
Next steps - Staff will return with the requested analysis and specific decision packages at the September 8 budget workshop. Additional preliminary budget sessions are scheduled ahead of the council retreat and the October public hearing on the 2026 budget.
Meeting context: The item was presented during the evening’s budget-preliminary session and prompted extended council discussion about priorities, tradeoffs and whether to pursue new revenue or reduce services.
