Sydney finance director warns state reimbursements cut sales tax, December report shows $374,000 deficit

City of Sydney — City finance director Kagan Carwin told the City Council on Jan. 13 that the city’s December 2025 financials showed a general fund deficit for the month of about $374,000 and significant volatility on the sales-tax line tied to state reimbursements.

Carwin said the city recorded no sales tax for December because of a state economic-development reimbursement under what was referred to in the meeting as the Advantage Act (now largely administered under an Imagine Nebraska framework). “No sales tax was collected this month due to that state economic development reimbursement,” Carwin said.

Why it matters: sales tax is a major local revenue source for municipal services. Carwin told council members the timing of reimbursement claims from the state can shift receipts between months and years and that staff had been notified of an estimated hit of roughly $250,000 for the coming year, although the city was still awaiting exact monthly timing from state notice.

Carwin walked the council through department-level results: for December the street department finished positive about $17,000, electric was positive about $205,000, water and sewer ended negative (roughly $70,000 and $118,000 respectively) and landfill was positive about $31,300. On a year-to-date basis the general fund picture follows the same trends; Carwin said staff will continue monitoring and exercising expenditure controls.

Council members asked whether the finance reports could show monthly budget-to-actual comparisons by department to make those variances easier to interpret. Carwin agreed to add total budget numbers and to present a month-by-month comparison in future reports.

The council voted to approve the December 2025 budget reports at the meeting; Carwin emphasized staff will continue to monitor revenues and recommended caution on discretionary spending until sales-tax trends stabilize.