Sheridan staff outlines FY26 proposed budget, funded and unfunded priorities; council discusses fire engines, firefighters and snow plan

Stuart McCray, Sheridan city administrator, presented an overview of the proposed fiscal year 2026 budget at the May 20 study session, describing the process staff used to prioritize funded items and the remaining unfunded discretionary requests.

McCray said the city’s combined available discretionary funding after mandatory items was about $1,959,000 but city departments requested about $3,191,000 in needs statements, leaving roughly $1,231,000 of requests unfunded. He described the published materials that show funded items “above the line” and unfunded items “below the line.” He told council staff expect a FY25 budget surplus that could be considered in a future budget revision to fund items below the line; he said staff will have a clearer picture of carryover funds by November and that any allocation of surplus would come back to council via a formal budget revision.

McCray reviewed department-level funded and unfunded totals. Public works showed $734,650 funded and $782,500 unfunded, with a $380,000 street-sweeper request among the larger unfunded items and a $50,000 contractual pothole/concrete allocation listed as unfunded. McCray said bridge repairs were split between funded and unfunded components (example figures cited: $300,000 funded; $150,000 remaining). He warned that if no surplus materializes the city would need to re-evaluate the snow-removal plan; staff listed nine snow-related items of which five were funded ($75,000) and four unfunded ($60,000).

On public safety, McCray said Sheridan Fire Rescue requested six firefighter positions; three were funded in the proposed budget and three remained unfunded with the unapproved three costing $236,779 as presented. McCray explained the timing difference that produced cost variance: the funded hires were assumed to start at the beginning of the fiscal year (a full year of pay) while the unfunded hires were estimated for a January start and therefore reflect a shorter first-year cost.

Council members asked about planned replacement of two fire engines. McCray said the administration reserved $250,000 in the current budget for the match toward one engine and planned another $250,000 transfer in the fleet budget next year for the second engine; both vehicle replacements are tied to anticipated MRG grant funding. He said one engine replacement is scheduled for FY26 and the other for FY27; staff expect about a four-year lead time to build new apparatus and noted the current engines are roughly 15 years old. McCray said if MRG grants are not awarded the city would either continue to operate aging equipment or use reserve funds and/or return to council to identify funding alternatives.

McCray also summarized smaller items across departments: parks projects with several unfunded line items ($113,600 unfunded), Kendrick Park pool cameras ($12,500 unfunded), IT “tough book” devices for police (part of vehicle/equipment planning), and a small $500 request in administration for leadership development resources. He said departments reduced training requests roughly 18 percent across the board.

Council members discussed fleet leasing versus purchase and asked staff to prepare an informational presentation on leasing options and on the types of grants the city receives. McCray said staff will prepare those briefings. He reiterated the formal vote on the budget will occur in three weeks and that unfunded items are not part of the current vote; council will vote on the funded list and later consider any budget revisions if surplus funds become available.