Signal Mountain council agrees on $140,000 cap for cost-of-living pay increases as budget shows a small shortfall

Signal Mountain Town Council members reached consensus on Tuesday to cap cost-of-living adjustments for the fiscal 2025–26 budget at a maximum of $140,000 — about a 2.75% increase on the budgeted salary base — and to include the town manager in that adjustment.

Town Manager Matt Justice presented the proposed fiscal 2025–26 budget, saying “general fund revenues for the 25–26 budget year are projected to be $9,873,266” and that total budget appropriations are $10,012,620, producing a projected general-fund shortfall of $139,154. Justice also told the council the proposed budget includes an estimated $287,015 expense to transfer operation of the Mountain Arts Community Center to the town.

The council’s action to set a $140,000 cap was reached by verbal consensus rather than a formal roll-call vote. Mayor Elizabeth Baker confirmed the decision during the meeting, stating, “So that is consensus, on that.” Council members discussed COLA percentages, with several expressing comfort in a figure between 2% and 3% before settling on the $140,000 ceiling as a practical cap tied to a target percent.

Why it matters: The COLA cap determines how much the town will increase payroll costs next year; those costs feed directly into the general-fund deficit the council reviewed. The transfer of the Mountain Arts Community Center (MAC) into town operation was also budgeted in the proposed appropriation, creating a near-term cost the council must monitor as the town assumes program responsibilities.

Details from the budget presentation

- Revenues and shortfall:…