Jonathan Margot, presenting the utilities department’s 2026 budget forecast, told the council the department’s expenses are projected to increase about 2.9% year-over-year and that revenues and expenses are balanced in the proposed budget.

"Our budget expenses increased by 2.9% year over year," Margot said, noting the department had no department-wide cost-of-living adjustment for 2026 in accordance with city policy and that 2026 will be a year with 27 pay periods (a timing anomaly that affects payroll calculations).

Margot described capital needs and said the department is moving toward a 2026 bond to pay for two large projects: a Headworks Rehabilitation project discussed in the presentation at roughly $10,000,000 and the replacement of Lift Station 20 plus a large force main. He said the department treats connection and tap fees as restricted "growth" funds to pay for growth-related capital rather than operations.

Council members asked clarifying questions and were told sewer rates remain set under a multi-year rate schedule that does not require immediate rate increases. No formal action was required on the budget presentation at the meeting; staff will continue detailed budget work and bond planning.