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Lacey Council adopts $224.95 million 2026 budget, continues use of reserves to bridge shortfall
Summary
Council adopted Ordinance 16-93 setting the 2026 budget at $224,954,147 (general fund $74,396,916). Staff said the proposal maintains services while addressing a $3 million shortfall using reserves and a multi-year plan for revenue enhancements.
At its Dec. 16 meeting the Lacey City Council adopted its 2026 budget, Ordinance 16-93, setting total city budgets at $224,954,147 with a general fund budget of $74,396,916.
Finance staff (Speaker 17) framed the budget as preserving core services and staffing while noting revenue projections fall short of departmental requests by roughly $3,000,000. The staff presentation highlighted priorities retained in the budget, continued investments in critical infrastructure, and planned steps to close the gap through a mixture of reserves, revenue enhancements, and strategic economic development to broaden the tax base.
Chelsea Knight (Speaker 21) also presented Ordinance 16-91 to formalize council-designated reserves totaling $53,589,802 aligned with council priorities; staff said a final allocation of remaining 2025 fund balance would be completed once year-end numbers were known. Council discussed fiscal stewardship, the city's history of conservative budgeting and the need to balance service levels with long-term sustainability.
Council members thanked finance staff for the work. The motion to adopt Ordinance 16-93 carried unanimously. Council instructed staff to continue to pursue revenue options, review priorities and report back during the coming budget cycle.
