Council hears FY2026 budget options; gives guidance to set not-to-exceed tax rate at 82'cents

City staff presented three budget scenarios for FY2026 and sought direction on the city's not-to-exceed real-property tax rate; councilors gave consensus guidance to set the advertised not-to-exceed rate at 82 cents per $100 of assessed value.

City Manager Dan Hoffman told council the three scenarios correspond to tax rates of 78, 80 and 82 cents and that the revenue increases under those options would be roughly 1.1%, just under 3%, and about 3.9%, respectively. Hoffman said the proposed budget includes a $6.5 million increase over the current year and that some unavoidable costs (software maintenance, fuel, landfill fees, and other contracted services) drive much of that increase.

Hoffman summarized programmatic differences across the three options: the 80- and 82-cent scenarios would fund additional police officers (two in the higher scenarios, one under 78), more firefighter positions (three under 80, four under 82), added IT staffing in the 80/82 scenarios, and additional parks maintenance or seasonal pay. The administration also proposed buying police vehicles (two to four depending on the scenario) and replacing a trash truck from reserves at an estimated $510,000; the trash-truck purchase is planned to enable future staffing reductions as the automated system comes online.

On schools, Winchester Public Schools superintendent Jason Hukulam told council the school board reduced its city funding request from $1.6 million to $1.2 million after receiving a 0% increase in health-insurance costs. Hukulam said the school division's priorities remain salaries and competitive pay; he described a targeted approach to salary adjustments that raises the floor of pay scales while moderating increases at higher steps.

Hoffman and staff briefed council on capital and fund-balance uses the administration is proposing, including park projects: a $375,000 replacement playground at Family Land (reduced to $225,000 after a private donation of $150,000), restroom repairs, and potential outdoor-pool renovations budgeted at $250,000 or $500,000 depending on the scenario. Hoffman said the administration trimmed roughly $3 million from initial requests and is relying on a previously established emergency-contingency fund for some needs.

Council also discussed an existing Economic Development Authority support agreement that includes a $483,000 contingency backstop for a developer loan; Mary (city staff) said the amount is a placeholder and had not been used. Councilor McNeese proposed authorizing the EDA to administer up to $50,000 to aid small businesses negatively affected by construction projects; staff suggested pulling that money from the city's contingency fund and said the EDA would develop criteria and administer the program.

After discussion, councilors expressed a preference to retain flexibility and asked staff to advertise the not-to-exceed tax rate at 82 cents to preserve options for funding police, fire and other priorities while staff continues to refine figures; multiple councilors said they personally preferred lower final rates but wanted room to adjust as more data becomes available. Staff will publish the not-to-exceed rate in the required advertisement and return to council for final rate adoption in April under the state timeline.

There was no final vote adopting a specific tax rate at the meeting; the council's guidance was procedural direction to staff about the not-to-exceed rate to be advertised.