Gulfport council adopts FY2026 budget after tense debate over Forest Heights levee and $20M road grant

The Gulfport City Council adopted its FY2026 budget as amended on a vote at a special-call budget workshop, finalizing a package of nonprofit subsidies, ward capital allocations and a contested set of capital projects after a lengthy debate over levee funding for the Forest Heights neighborhood.

Finance Director Joe Dalto told the council the docket reflected the fifth draft of the proposal, with several changes from the prior version: an increase to Harbor Lights sponsorship revenue and personnel adjustments that move that enterprise fund to a balanced position, and the removal of two large items previously expected to be supported by federal appropriations — a $3.5 million quarters revitalization project and a $7 million land-acquisition line for Dedeaux Road — after those funds were not included by the U.S. House. “This is a necessary part, for ensuring funding for the city of Gulfport for the year of 2026,” Dalto said as he summarized Draft Proposal No. 5.

Council members then worked line-by-line through grant subsidies and capital projects. On page 9 (grant subsidies and allocations) the council approved a set of additions and adjustments that included raising the Boys & Girls Club award to $5,000 and adding or increasing awards and sponsorships the council approved in principle: the Griot Society ($1,500), Extend A Hand (added as a new recipient, amount discussed), a Minority Mental Health Symposium sponsorship ($3,500), the North Gulfport Community Land Conservancy ($12,000), the Community Save Project (recommended $1,000), and Magnolia Grove Concerned Citizens’ fall festival (potential sponsorship $500). City staff and the city attorney noted that those allocations will be vetted for statutory eligibility and, where required, brought back by resolution or with appropriate documentation.

Members also debated maintenance contracts and service equity for grass cutting, noting roughly $1.2 million appears in the current budget for contracted turf maintenance. Council members asked administration to analyze contract language and to propose street swaps so under-served wards can receive service parity while honoring existing contract obligations. The mayor and administration committed to provide a prioritized list of candidate street swaps and to work with contractors on negotiable adjustments.

The most contentious portion of the meeting centered on the capital worksheet (page 32 and related MIMA bond pages). Council discussion focused on a $20 million Gulfport Commerce Corridor project (state funding and GCRF/DFA support were cited) and a suite of other externally funded roadway projects; several council members urged keeping the state money in the budget to avoid forfeiting it to the state. Councilwoman Hines (referred to in the meeting as “Miss Ella”) objected to moving forward on large new corridor and bill-road projects without ensuring funding for a long-standing Forest Heights flood-protection effort. Hines argued that pumps alone would not produce a FEMA‑certified levee and that Forest Heights residents — she said roughly 200 families — needed a certified levee to meaningfully reduce flood insurance burdens. “Pumps is not what we need. We need the Forest Heights levy,” she said.

After extended discussion the council negotiated a compromise: the Forest Heights drainage/levee line was increased on the capital worksheet from a rollover amount of $907,110 to $4,500,000 as a budgeted placeholder/receivable to be used as local match while staff pursues federal and county matches and other grant sources. Staff said that increase will be shown as a receivable and requires supporting BLIs and additional documentation; the mayor and administration committed to pursue matching funds and to coordinate with the Corps and county partners.

The council also agreed to add seven new capital line items of $100,000 each (one per ward) from MIMA‑qualified reserves to fund infrastructure projects with a life expectancy longer than 15 years (sidewalks, curbs, gutters, drainage, water or street improvements). The mayor said the funding is a management decision and acknowledged the city’s revenue constraints for FY26.

Because Councilwoman Hines asked to register her opposition to the Gulfport Commerce Corridor line, the council divided the capital worksheet so that the Commerce Corridor item could be called separately. Members voted to retain the Commerce Corridor funding line while at least one member opposed keeping it on the worksheet. Separately, council recorded approval of the other amended capital items, including the Forest Heights increase and the seven ward allocations.

The council then called the budget, as amended, and adopted it. Administration and staff committed to provide detailed documentation backing the newly added allocations and to return with refinements on contract and obligations: a streets list and proposed contractor swaps for grass-cutting; BLIs and source documentation for added capital match lines; and continued pursuit of Corps/GRF/county funding for the Forest Heights levee. The council also noted some items (community events and certain advertising/sponsorship awards) will require follow-up resolutions and legal vetting prior to disbursement.

Votes at a glance: the council approved the grant/subsidy revisions on page 9 (awards and additions enumerated above); amended the capital worksheet (page 32) to increase the Forest Heights drainage/levee allocation to $4,500,000 and to add seven $100,000 MIMA‑qualified ward lines; and adopted the FY2026 budget as amended. The Commerce Corridor line was called out for a separate recorded vote and was retained by majority vote while at least one councilmember voted no. Staff recorded the page‑32 division and the Forest Heights change for follow-up accounting adjustments.

What happens next: administration will provide itemized BLIs and backup for the new lines, work with legal to vet community allocations for statutory compliance, present a recommended street-swap list and contractor negotiation plan for turf maintenance, and continue grant‑seeking and intergovernmental negotiation on the Forest Heights levee match. The council scheduled further follow-up and noted several items will be revisited in workshop or resolution form before disbursement.