Indianola council hears FY26 proposed budget, directs staff on COLA, fees and Willow Crest engineering

City finance staff presented a proposed FY26 budget that trims education, some capital projects and service contracts while asking the City Council for direction on property tax levies, utility fee increases and how to allocate hotel/motel tax revenue.

"Our revenue growth was capped by the state at 2.51%. The CPI expenses for 2024 were an average of 3%. So we're not capturing the full amount of inflation," Jackie, finance staff, said as she walked council through the packet figures. She said that if the city levied the full amount recommended for liability, insurance and benefits the city would collect substantially more property-tax revenue but that the council had not levied the full amount in the past.

The presentation listed department-by-department reductions: cuts to travel and training across most departments; elimination or delay of several capital purchases and projects (including $110,000 in capital improvements in IT, a chassis replacement for a fire pumper, some pool and facility work at the IWC, and vehicle replacements in parks and sewer); and program reductions (for example, Main Street funding cut from community development and removal of RFID tagging and self-checkout at the library). Jackie warned that not levying the full insurance and benefits request "will mean the departments will need to cut their budgets further."

Why it matters

Council members framed the proposal as a response to constrained revenues and rising costs and debated tradeoffs among staff compensation, service levels and one-time projects. The packet preserved a 3% cost-of-living adjustment (COLA) in the proposed budget for most employees and a 6% increase for police…