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Perry opens public hearing on FY2025–26 budget; staff proposes 25% water rate increase
Summary
City staff presented the proposed FY2025–26 budget and enterprise fund plans at a May 22 public hearing. The package would not raise the overall tax rate but includes a proposed 25% increase to the water user rate, a 2% sewer increase, no garbage rate increase and planned capital projects funded partly from restricted funds and fund balance.
Perry — City staff opened a public hearing May 22 on the proposed Perry City fiscal year 2025–26 budget, presenting general fund projections, enterprise fund changes and capital projects ahead of final adoption deadlines this summer. The proposal does not include an overall property tax increase but would raise the municipal water user rate by 25 percent.
City finance staff said the general fund revenues for FY2026 are projected at $6,608,109 and that the proposed budget is balanced against planned expenses and planned transfers. “This plan here does not include a tax increase,” a city staff member summarized during the presentation. The package includes street projects, transfers to debt service for the city hall bond payment and restricted-fund spending for road and park impact fees.
The water enterprise would be the most notable change in the draft budget. Staff proposed a 25 percent water rate increase that would move the standard water charge to roughly $26.74, to be phased over multiple years. “Includes a rate increase of 25% to water,” the presenter said. The water fund shows operating revenue of about $680,858 and operating expenses of roughly $767,662, producing an operating-level loss before factoring depreciation and non-operating revenue. When depreciation and impact fees are included, staff projects net positive cash available for system repairs and improvements.
Sewer and garbage funds: Sewer operating revenue is projected at $1,483,279 with planned routine annual sewer-rate increases of 2 percent. Staff said that with the planned rate the sewer fund’s debt coverage ratio would meet bond requirements. The garbage fund will not see a rate increase in FY2026, staff recommended, because projected revenues exceed operating expenses; that fund is largely driven by the city’s contract with Republic Services. The storm‑drain fund shows a modest operating gap that staff will monitor and adjust if losses persist.
Capital projects and restricted funds: The draft general‑fund projects list includes more than $3.5 million in street projects, including work tied to the 1200 West/1200 West North project and trailway improvements, some of which are supported by a nearly $1.9 million grant. Other planned spending includes landscaping at City Hall and the event center, a Mountain View Bike Park (with 70 percent grant support for the identified work), and capital contributions for the gun range and public‑works facility. The budget shows a projected unrestricted fund balance of about 23 percent of general‑fund expenditures (above the 5 percent minimum and below the 35 percent cap described by staff).
Redevelopment Agency: Staff also reviewed the Perry City RDA budget. Revenues for the RDA are shown as the property‑tax and sales‑tax increments from Point Perry and are projected at roughly $229,008. Staff said RDA receipts are being used to reimburse the city for approximately $1.3 million in bond payments made when a developer defaulted; that loan is expected to be repaid by fiscal year 2027.
Public hearing and next steps: The council opened and then, after no in‑chamber speakers, closed the public hearing for the city and the RDA budgets. Staff noted state deadlines: a tax rate must be passed within the statutory schedule (property tax rates are due mid‑June) and final budget adoption must occur before June 30 unless the council elects to pursue truth‑in‑taxation procedures (which extend the deadline). Staff advised council members that certified county tax rates were expected from the state tax commission in early June and that council would reconvene to consider the certified rate on June 12.
Quotations and context: During the presentation staff emphasized planning tradeoffs for enterprise funds: “This plan here does not include a tax increase,” a staff member said, and later explained the proposed water increase as necessary to stop multi‑year operating losses and to provide cash for capital improvements. The council discussed options and requested additional detail to be circulated before the next meeting.
Ending: The council did not adopt the final budget at the May 22 meeting; staff will return with any updates, certified tax information and any requested clarifications for council action at a later meeting ahead of the June 30 deadline.
