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Herriman staff previews 2027 budget, flags $1.4M projected General Fund increase and impact-fee shortfall
Summary
City staff told the Herriman City Council the FY2027 General Fund could grow by about $1.4 million—driven by sales tax and certain intergovernmental road funds—but warned transportation impact fees are projected to fall about 30%, creating pressure on the General Fund and capital plans.
City finance staff presented an early look at Herriman’s proposed FY2027 budget at the Jan. 14 council work meeting, saying the General Fund is projected to rise by roughly $1,400,000 in 2027, driven mainly by expected increases in sales tax and certain intergovernmental (Class C) road funds.
Trevor, a city financial staffer, told the council that property tax growth should be relatively flat after adjusting for delinquent‑tax receipts and that new commercial developments factored into the forecast include an anticipated auto dealership and a major retailer in 2027–28. "For '27, we are expecting an increase of about 1,400,000," Trevor said during his presentation.
Staff cautioned the council that Class C (gas tax) receipts are volatile and that the state formula allocating those funds is complex; small timing shifts can swing quarterly results. The presentation also noted other long‑term liabilities on the books, including roughly $77.7 million of bonded debt, a remaining vehicle note payable, about $3.3 million in compensated absences and a roughly $4.4 million pension obligation shown on financial statements.
City staff identified a budget risk tied to transportation impact fees: recent changes—jurisdictional transfers and adoption of public infrastructure districts—mean much of certain road costs will no longer be eligible for impact fees. As a result, the staff projection for what the city will collect in impact fees dropped by about 30%. "We are only expecting approximately 1,200,000 in impact fees next year, so most likely the General Fund will have to make up the difference," Trevor said.
Council members asked clarifying questions about how sales tax is split between direct in‑city sales and the statewide population pool, incentives offered to developers, and how the city counts ‘‘new growth’’ in property tax calculations. Staff said some forecasted sales tax is net of incentives and that initial projections are intentionally conservative until actual receipts arrive.
The presentation also reviewed the city’s long‑range capital needs and debt service schedule, including bonds issued in 2015, 2021 and one issued last year that carries roughly $16.3 million outstanding with annual debt service near $1.3 million. Staff emphasized that while some debt can be serviced with impact fees, those payments require available impact fee balances to be on hand.
Council direction: staff will incorporate the forecasts into the upcoming budget workshops and refine numbers as receipts and state allocations become clearer. The council did not take formal action on the budget during the work meeting.
