The Eugene City Council on Dec. 8 adopted the city’s first supplemental budget for the 2025–27 biennium, voting 8–0 to approve staff’s recommended appropriations and adjustments.

City staff presented the supplemental budget as a reconciliation of beginning working capital, capital carryover, and encumbrances, and described a proposed $8,000,000 investment in the PERS Employer Incentive Fund intended to trigger $2,000,000 in state matching funds and to reduce the city’s PERS rate over the next six years. Staff also reported that after the proposed supplemental budget actions the reserve for revenue shortfall will be $17,100,000, or roughly 3.6% of general fund expenditures (below the 4% target level used previously).

During debate Councilor Leach proposed — and the council approved — an amendment moving $50,000 from that reserve into council contingency to allow rapid response funding tied to other council direction (see related coverage). City Manager Sarah Madari explained that moving funds into contingency creates flexibility but does not itself authorize spending; a subsequent action would be required to allocate contingency funds.

Why it matters: The PERS prepayment is a long-term liability-management move intended to reduce employer rates over multiple years, with immediate cash outlay but anticipated future savings. Council members and public commenters described the buy-down as fiscally prudent while also stressing the city’s constrained near-term budget picture.

Vote and next steps: The main motion to adopt the supplemental budget (as amended) passed 8–0. Staff will proceed with the appropriation adjustments and return to council for any future spending moves out of contingency or additional supplemental budgets.

Direct quotes from the meeting include staff explaining the PERS action: "This includes making an investment of $8,000,000 in the PERS Employer Incentive Fund to receive $2,000,000 in matching funds from the state and reduce our PERS rate over the next 6 years."