Canton council hears FY2026 budget proposal that trims millage rate and funds $42 million in capital projects

City Manager Mr. Luckett told the City of Canton council on July 17 that the proposed fiscal 2026 budget is balanced and funds core city services while reducing the millage rate from 5.4 to 5.25.

Luckett said the city’s combined ‘‘all funds’’ totalled about $94.7 million and the proposal includes nearly $42,000,000 in capital investment for water and sewer, parks and transportation infrastructure. He told the council the proposed millage cut would lower projected property-tax revenue by about $330,000.

On revenue sources, Luckett said approximately 24% of the all‑funds budget comes from charges for services (primarily water and sewer), about 24% comes from use of reserves to support capital projects, about 14% from property taxes and roughly 11% from franchise, business and excise taxes. He noted digest growth of 7.5% for 2025—about 3.5% due to inflation and roughly 4% from new construction—and that a new floating homestead exemption has increased exemptions by about 23%, removing roughly $39 million in assessed value and reducing revenue by about $200,000.

Luckett reviewed fund-level proposals: a general fund of about $30.5 million (43% from property taxes), a water and sewer fund proposed at $36.4 million (about $16.9 million operating and $19.4 million capital) and a proposed 2.5% increase to water and sewer rates included in the fee schedule. He said the budget includes completion of the sewer plant expansion and first-year funding for the Ridge Pine elevated tank project. He also noted the stormwater fee would rise by 50¢ to $1.75 and the hotel-motel-tax fund was proposed at $1,270,000, including $480,000 for Canton tourism.

A resident who signed up for the public hearing, Thomas Weaver, told the council he was ‘‘fearful that the double whammy’’ of inflation-linked increases and growing exemptions could make continued reliance on reserves unsustainable. Weaver also flagged state legislation, saying ‘‘HB 225, if enacted into law, would repeal the red speed program altogether, and it would cause a loss of funds’’ that the city currently counts as fines revenue. He asked the council to be cautious about depending on that revenue stream.

Luckett acknowledged a projected reduction in fines revenue and estimated red-light/revenue (‘‘Red Speed’’) will be about $750,000 less than budgeted for FY25; he said staff will monitor revenues and recommend adjustments if needed. The mayor praised council and staff for fiscal stewardship and reminded the public that formal adoption of the budget is scheduled for the council’s August 7 meeting.

Votes and next steps: no final budget vote was taken on July 17; the hearing closed and the council set the adoption vote for Aug. 7.