Council discusses FY26 budget priorities, vehicle-replacement reserve and street-sweeper funding

City Administrator Stuart McCray and department staff briefed the council on key issues in the proposed FY26 budget, focusing on a recommended approach to establish a vehicle-replacement reserve, the condition and funding of the city’s street sweeper and provisions for snow removal.

McCray said any items below the sheet’s red line are not in the adopted budget; items above the line are currently funded. He described options for adding detail to future budget books so council could more easily see department-level spending and discussed staff plans to produce an addendum or include the breakout in next year’s budget.

Council members and staff discussed the concept of a centralized fleet replacement fund. Heather Seplinski, the city’s fleet manager, summarized a model the city could adopt: catalog assets, estimate replacement cycles and annualize replacement costs so departments contribute a set annual amount to a fleet reserve. Seplinski said the city has 388 fleet assets and recommended starting FY26 replacements moving forward in the schedule while continuing to request replacements for older assets that predate the reserve. She gave an example for police cars: an outfitted cruiser costing about $77,000 with an eight-year replacement cycle equates to roughly $10,000 per car per year to pre-fund replacements.

Council members also raised the immediate concern of the street sweeper. Staff described the existing sweeper as “long in the tooth,” with parts getting hard to find and maintenance costs rising. Staff listed an estimated replacement cost of roughly $385,000 for a new sweeper; council members asked whether the city could reallocate above-the-line budget items or use reserves to fund an immediate purchase and discussed whether swept-street maintenance is tied to air-quality and stormwater requirements.

Assistant city staff suggested a longer-term funding option: creating a stormwater utility to fund stormwater-related services (including street sweeping) through a small monthly fee on utility bills. Staff said the state statute enables stormwater utilities and that a utility could fund curb-and-gutter work, storm drains, street sweepers and related river-system work.

On snow removal, staff said FY24 and FY25 expenditures had varied with weather: contractual snow removal in prior years totaled about $135,000 split between funds; FY26 above-the-line funding for contracted snow pickups was listed as about $75,000 (split between direct distribution and GPET), leaving the rest of prior funding levels below the red line. Staff said adjustments could be made later in the year through budget reconciliation if needed, and that the city could react to an early heavy snow season via a budget revision.

No formal budget adoption occurred at the May 12 briefing; staff asked council to provide direction on whether to pursue a formal vehicle-replacement fund, consider using reserves for high-priority below-the-line equipment such as the street sweeper, and to prioritize items for final budget adoption.