Forney reviews FY2025–26 budget proposal; council asks for compensation and health-cost breakdowns and adopts amended budget policy

Finance Director Deborah Whittam presented the City of Forney's proposed fiscal year 2025–26 operating budget at the Aug. 19 council meeting and described revenue shortfalls, proposed tax-rate changes and planned spending priorities.

Whittam said staff began budget work in March and found roughly a $1 million gap after comparing department requests to forecasted revenues. To address the gap, management identified cuts, raised the proposed tax rate by one cent and rebudgeted some transfers to meet charter requirements for contingent appropriations. Staff projected sales-tax receipts are down about 1.8% statewide and about 2% below Forney's actual collections last year; staff therefore budgeted a decrease in sales-tax receipts for the coming year. Property valuations were up slightly, prompting the proposed tax-rate adjustment to meet revenue targets.

The proposed budget packages a 4% cost-of-living adjustment (COLA) for employees and a 3% merit pool. Police and fire pay increases were negotiated through meet-and-confer processes and range between about 10% and 13% for those contracts, while civilian employees would receive the advertised COLA/merit approach. Health-insurance costs were projected to rise by about 16% and were included in the budget. Staff noted a proposed half-million-dollar escrow for a future fire apparatus and other capital and fleet purchases; the utility fund includes pass-throughs for North Texas Municipal Water District proposals (about 8.8% for water and a 16.7% increase in sewer cost components) that the city proposes to pass to customers.

Councilmembers extensively questioned compensation practices. Councilmember Weatherford said payroll and benefits make up a majority of the budget and requested a series of analyses to inform policy decisions: five-year merit-utilization reporting by department (actual dollars and percentages used versus budgeted merit pools), five-year healthcare-cost trends including employer/employee contribution splits, a 10-year summary of COLA policy and the fiscal impact, and a five-year summary of COLA dollars paid. He asked that this data be provided well in advance of the Aug. 26 meeting so council could make an informed choice about a proposed tax rate.

Councilmembers also debated how transfers in and out are presented in the publicly posted budget document. Some councilmembers said the budget document's presentation of transfers as expenditures can mislead readers; finance staff responded that the city's audited financial statements report transfers as "other financing sources/uses" consistent with GASB and that the budget document is a distinct public-facing report used to show compliance with the charter's fund-balance limitation.

After discussion, the council adopted a motion to amend the city's budget policy (a motion by Councilmember Weatherford, second by Ms. Salgado) to require timing and access provisions for draft and proposed budgets and to provide councils with additional formal review time before tax-rate consideration. Council voted in favor of the policy amendment by show of hands. There was no final adoption of the operating budget that evening; staff will return with final budget actions as the process continues.