Goshen council approves 2026 city budget on first reading while officials warn of deep cuts from state law

GOSHEN, Ind. — The Goshen City Council voted to approve the proposed 2026 City of Goshen budget (Ordinance 52-34) on first reading at its Sept. 22 meeting after a detailed presentation from municipal advisers and more than an hour of public comment from local nonprofits and residents.

The council’s vote followed an overview by Amber Nielsen of Baker Tilly, the city’s financial adviser, and extended remarks from Mayor Lydia Lichty (Mayor Lichty’s exact title given in the transcript is Mayor Lichty). Nielsen showed ten-year trends for the city’s largest operating funds and said the proposed 2026 budget keeps those core funds balanced while projecting a modest decline in fund balances if full budgets are spent. “The proposed budget for 2026 is just over $40,000,000,” Nielsen told the council during the presentation.

Why it matters: advisers and the mayor said the budget reflects early planning for the revenue impacts of Senate Enrolled Act 1 (referred to in the meeting as SEA 1 or SB 1). The city expects roughly an $800,000 revenue loss in 2026, similar losses in 2027, and substantially larger reductions beginning in 2028 when local income-tax structures change. Mayor Lichty summarized the risk during the presentation: the bottom “drops out in 2028,” and the city could face a multi‑million‑dollar shortfall without legislative change or new local revenue sources. “In 2028 … we would have more than a $13,000,000 loss in our budget,” the mayor said.

Most important facts - Ordinance 52-34 (2026 City of Goshen budget) passed on first reading; councilors voted to advance the ordinance for a second reading at a future meeting (the second reading date to be determined per council schedule). - Baker Tilly reviewed recent financial history and projections, showing that core operating funds (general, motor vehicle highway, parks, public safety LIT) are roughly balanced for 2026 but that fund balances would decline under full spending assumptions. - The city estimates an initial SEA 1 impact of about $800,000 in 2026 and warned of much larger shortfalls beginning in 2028 when local income-tax revenue is expected to change.

Council and staff messaging Baker Tilly’s analysis emphasized three priorities: continued expense management, program and service reductions targeted to minimize harm where possible, and exploring new or increased local revenue sources. Mayor Lichty said department heads were asked to model what a 20% revenue reduction would mean for each department as a planning exercise. She walked the council through examples: a 20% reduction in police funding could reduce sworn officers, suspend some school resource officer and special‑unit coverage, and narrow patrol responses; in fire services it could mean laying off firefighters or closing stations; in streets and parks it could mean scaled-back paving, maintenance, and program cancellations.

Public response and nonprofit testimony Nineteen people signed up to comment on the budget. Several nonprofit and cultural leaders urged the council to preserve partnership funding in the city’s economic development (EDIT) appropriation, arguing those programs produce local economic activity and community benefits. Amanda Rose, director of First Fridays in Downtown Goshen, told the council: “These partnerships are not extras, but rather essential to our community.” Trevor Daugherty of the Northern Indiana Clay Alliance and others said visitor-driven events supported by city partnership grants bring hotel, restaurant and retail revenue to Goshen.

Council discussion and next steps Councilors repeatedly thanked department heads and advisers for the work on a difficult budget. The council voted to approve the ordinance on first reading; the clerk‑treasurer conducted a roll call at the request of a councilor and the recorded votes were all recorded as “yes” for first reading. Councilors discussed holding additional public engagement and said they had invited state legislators to a town‑hall style meeting about SEA 1 impacts; the council and several speakers urged nonpartisan, public conversations with state representatives.

Clarifying details from the meeting - The city’s 2026 levy growth quotient is capped at 4% for the year, per state changes discussed in the presentation. - The city’s core operating funds were shown with a combined ending‑2024 reserve of roughly 90% of annual operating for those funds; under the proposed 2026 spending pattern the advisers projected that reserve could drop to about 56% by the end of 2026 if full budgets are spent. - The council adopted a municipal wheel tax earlier in 2025; the city expects about $780,000 in wheel‑tax revenue for the municipal wheel‑tax fund and planned to spend approximately $750,000 in 2026 from that fund.

Quotes “‘The proposed budget for 2026 is just over $40,000,000,’” Amber Nielsen, municipal adviser with Baker Tilly, told the council.

“We will have about an $800,000 loss [in 2026],” Mayor Lichty told the council, “and the bottom drops out in 2028.”

“These partnerships are not extras, but rather essential to our community,” Amanda Rose, director of First Fridays in Downtown Goshen, said during the public‑comment period.

Ending The council advanced Ordinance 52-34 on first reading and will return for the second reading and final adoption at the date set under council procedure. City officials asked residents and community organizations to stay engaged as staff continue to refine projections and present specific options for program reductions, revenue adjustments, or service changes if the state law’s impacts proceed as currently projected.

Votes at a glance - Ordinance 52-34, 2026 City of Goshen budget — Motion by Council President Weddell; second by Councilor Ledrock; outcome: approved on first reading (roll‑call votes recorded as yes).