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Budget staff says 2026 draft includes 1% property tax increase; council continues revenue hearing to Nov. 3
Summary
City budget staff told the council that the 2026 draft budget includes a 1% property-tax levy increase (the maximum allowed without voter approval) and outlined sales and utility tax trends; council continued the public revenue hearing to Nov. 3 to allow public review after the mayor’s budget release.
City budget analysts presented a staff overview of general fund revenue projections during the Tuesday hearing on possible 2026 revenue sources, telling the council the draft 2026 budget assumes a 1% increase to property tax levies — the maximum levy growth the city can adopt without voter approval under state law because inflation exceeds 1%.
Connor Thorne, a city budget analyst, and colleagues summarized the “big three” revenue sources — property, sales and utility taxes — and noted factors that could affect forecasting, including consumer confidence, interest rates and population or construction growth. Thorne said city staff reduced some sales-tax projections based on the state economic forecast and had modest adjustments to utility-tax expectations due to utility rate changes.
Staff provided an example of estimated homeowner impact: a $250,000 assessed value residence would see an estimated annual increase of about $6.35 under a 1% levy rise. Budget staff asked the council to consider uncertainties and the practical impacts of rate adjustments and usage changes on utility taxes.
Council member McCat Hart and others asked that the public be given an opportunity to react after the mayor’s budget is released. The council voted to continue the revenue hearing until Nov. 3, coinciding with the budget release, so residents can review the mayor’s full proposal and comment before the property-tax levy is finalized.
