Germantown board advances $211.3 million FY‑26 budget, proposes 29.13¢ property tax increase

The Board of Mayor and Aldermen of Germantown advanced the fiscal year 2026 budget on first reading Monday, approving a $211,300,000 spending plan that includes $78,700,000 in general‑fund expenditures and a recommended 29.13¢ increase to the property tax rate.

The budget proposal, presented by City Administrator Michael Heisman and Budget Director Adrian Royalls, would set a proposed tax rate of $1.79 per $100 of assessed value after the state‑required rollback and an additional 29.13¢ adjustment to support operational and capital priorities. "This plan covering the fiscal year ahead beginning July 1, represents one of the most important policy decisions the board will undertake this year," Heisman said during the presentation.

Administration said the FY‑26 plan is structurally balanced and grounded in the city’s Germantown Forward 2035 strategic plan. It prioritizes public safety, asset renewal, and infrastructure maintenance, and includes targeted investments such as park maintenance, pavement preservation, and continuing funding for the utility and enterprise funds. Director Adrian Royalls highlighted the multi‑year process that produced the proposal and said the general fund revenues are projected at $82.5 million, with property tax accounting for about 55 percent of that total.

Why it matters: Board members and residents framed the vote as a choice between preserving services and maintaining the city’s long‑term financial strength. Administration emphasized Moody’s/S&P bond‑rating goals and pension obligations as constraints on the plan. Royalls told the board the budget includes a plan to maintain the city’s asset‑renewal schedule and to keep pension contributions fully funded, items she described as nonnegotiable to protect the city’s credit rating.

Public hearing and citizen comments: The reading included a public hearing that drew about a dozen speakers. Several residents and three Houston High School students urged the board to accelerate capital investment at Houston High, citing aging facilities, incomplete science labs and limited athletic amenities. Student Ethan Stickles said touring families often ask about school facilities and that facilities “can determine whether families choose Houston or another district.” Other speakers asked the board to maintain paving and drainage investments and raised concerns about neighborhood crime, traffic speeds and the Germantown Athletic Club pool’s indoor air quality and HVAC reliability.

Amendments and board action: The board considered multiple proposed amendments before approving the budget on reading. The largest successful amendment increased the board’s proposed commitment to the Germantown Municipal School District (GMSD) high‑school renovation: Vice Mayor Gibson’s amendment raised the FY‑27 CIP allocation for Houston High School from $8 million to $10 million; the amendment passed (roll call: yes — Aldermen Salvaggio, Sanders, Yulicki, Hicks, Gibson; details recorded in the minutes). Several other amendment proposals brought by Alderman Salvaggio — including cuts to a planned citywide LED street‑light conversion, reductions to paving transfers, and new recurring allocations for school capital — were debated but failed on roll calls.

Key numbers and details - Total proposed FY‑26 budget: $211,300,000. - General fund proposed spending: $78,700,000 (a 2.9% increase over FY‑25). - Proposed tax rate after rollback and adjustment: $1.79 per $100 assessed value (includes 29.13¢ increase proposed to support five‑year planning). Director Royalls explained the rollback process; the county and state certify the rollback rate to prevent a reappraisal windfall. - Retirement (pension) actuarial contribution increases were cited as adding roughly $3.5 million over the last three years and remain a fixed obligation. - Pavement management: the FY‑26 CIP includes $2,490,000 for pavement work intended to cover roughly 9–10 miles.

Board and next steps: The FY‑26 budget passed on first reading and will return for final consideration at the board’s June 23 meeting. Several board members said they will keep working with GMSD leadership and staff to explore options — including possible joint meetings — for longer‑term school capital funding. The board also directed administration to continue pursuing federal and state grants to leverage local dollars.

Votes at a glance - Motion to approve FY‑26 budget on reading: Passed (motion by Alderman Yulicki; second by Vice Mayor Gibson). Exact roll‑call votes were recorded in the meeting minutes.

Sources and attribution: Direct quotations and program details in this article come from the budget presentations by City Administrator Michael Heisman and Budget Director Adrian Royalls, and from public comments recorded at the June 9, 2025 Board of Mayor and Aldermen meeting.