Mayor, finance director present balanced 2026 budget; proposes 3.96% real-estate tax increase and $40M borrowing for capital

City leaders presented the proposed 2026 budget to the Budget & Finance Committee on Sept. 30, describing a $246 million citywide budget and a $150.6 million general fund budget designed to remain structurally balanced while funding public safety, equipment and capital needs.

Bina Patel, city controller, told the committee the finance department’s proposed budget for 2026 totals $17.7 million for the department and includes 36 full-time positions; $12.8 million of that sum represents interfund transfers supporting capital, equipment, debt service and special revenue funds while $4.8 million reflects operational spending.

The mayor framed the 2026 proposal as a values-based, balanced budget that continues funding for police, firefighters and paramedics and supports public works, inspections and parks. “We delivered a balanced budget to you,” the mayor said, and emphasized the budget’s goal of sustaining core services while living within available resources.

The presentation listed the general fund budget at $150.6 million and noted a vacancy factor of $2.4 million. Finance staff identified key cost drivers for 2026: rising health-insurance costs (reported around $25.9 million), the minimum municipal pension obligation (around $19.0 million), an increase in garbage collection and disposal contract costs (about $5.2 million), and debt-service payments estimated at $8.3 million.

Finance projected continued revenue growth over the next five years with a 3.8% compound annual growth rate (2026–2030) for general fund revenues and assumptions that the city will increase the real-estate tax by less than 4% annually. The presentation specifically cited a proposed 3.96% real-estate tax increase (0.28 mills in the packet) that the finance director said would generate approximately $1.5 million in additional revenue.

To support major capital projects, finance staff said the city plans to issue new general-obligation bonds in 2026, with anticipated external borrowing of around $40 million and the first debt payment from that borrowing expected in 2027. Projects mentioned as ongoing or prioritized in 2026 included Bogars Bridge, Martin Luther King Jr. Trails, traffic-safety upgrades and improvements to the police headquarters; the presentation also referenced a consolidated life-safety and wellness center that would include a fire station, EMS and a health bureau.

Committee members asked for clarifications on capital projects and on upcoming collective-bargaining contracts. Finance staff said the AFf/IFP (reference in transcript) contract had been renewed, SEIU negotiations were ongoing, and the FOP contract expires in 2026 with negotiations anticipated to begin in 2026 in preparation for a 2027 renewal cycle.

An outside reviewer (identified in the meeting as Mr. Glaser) told the committee he had reviewed the revenue estimates and described them as reasonable and reliable in the aggregate barring an unforeseen catastrophic event.

Ending: The committee thanked finance staff for the presentation and accepted the proposed budget for further review as the council’s budget deliberations continue; no formal vote was taken at the committee meeting.