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Shelton staff reports roughly $3.1 million positive budget variance for 2025; council asks about sewer rates
Summary
Interim finance staff told the council the 2025 year-end numbers show an estimated $3.1 million positive variance and a general fund reserve; council members pressed staff about sewer fund balances, potential customer rebates and a planned 2027 rate study to guide future rates and capital planning.
An interim finance staff member filling in for the finance director presented Shelton’s December 2025 year-end financial figures and told council members the city closed the year with an estimated positive budget variance of about $3.1 million.
The presenter said increases in sales tax, utility tax, business-and-occupation receipts and charges for services accounted for much of the revenue upside, while underspending in detention/corrections and some capital projects contributed to lower expenditures. The presenter described a 20 percent reserved fund balance and noted the city’s unreserved fund balance in the packet (reported as $5.7 million on the presentation).
Council members asked how the sewer capital fund’s positive balance might translate into rate relief. Staff said the sewer capital balance is being held for planned projects — including a reclaimed water tank and a satellite plant — and recommended a citywide utility rate study in 2027 to determine long-term rates, operating needs and capital financing. The presenter said that planned capital needs, including projects currently in procurement, make the use of reserves for one-time rebates imprudent without a formal rate analysis.
The finance overview also highlighted unfilled positions across departments and noted that staffing discussions will continue as strategic planning and supplemental budget proposals are considered. No formal budget amendments were adopted at the meeting; the presentation was informational and council members asked staff to follow up with more detail on outstanding debt and project financing.
