Council approves financial-policy resolutions after debate over new facilities reserve; community center posts rising revenues

Upper Arlington — During a second-reading budget hearing the City Council reviewed the 2026 proposed budget, received an update on community center operations and debated a new reserve policy to direct year-end excess into a facilities maintenance reserve and the capital asset management fund. After extensive discussion about stewardship and caps, the council approved two financial-policy resolutions and scheduled a later vote on a separate ordinance establishing the facilities maintenance reserve.

Director Lewis, presenting the budget highlights, said overall revenues are projected about 6% higher than last year and expenditures about 5% higher, reflecting personnel changes and planned facilities maintenance. On the community center, Director McLaughlin reported membership at roughly 11,500 and said staff raised the 2026 revenue projection from about $3.1 million to $3.6 million because memberships, rentals and revised fitness-program offerings are tracking better than originally forecast. McLaughlin said the center’s true operations are tracking at about 84% cost recovery on a six-month operations basis and that staff would provide a more detailed resident-versus-nonresident breakdown on follow-up.

The central policy debate centered on a proposal from the Financial Policies Committee to change how year-end excess above the 50% general-fund target is used. Director Lewis explained the committee’s plan: if year-end reserves exceed 50% of the general fund, 50% of the excess would be transferred to a newly established Facilities Maintenance Reserve (with a cap limiting annual transfers to 5% of prior-year general fund revenue and a 10% fund-balance cap), and 50% would be directed to the Capital Asset Management Fund. “If we go over 50%, we’re going to take that excess and we’re going to put 50% to fund the facilities maintenance reserve,” Lewis said.

Councilmember Kulewitz raised concerns that the proposed policy removes a previous mandatory spend-down provision and could create an effectively unregulated reserve that “is gonna continue to build and build.” Kulewitz warned it might remove impetus to spend on community priorities. Other council members and staff pushed back, arguing the change adds structure for maintenance and capital needs, helps preserve flexibility for debt-service and rating-agency metrics, and that the capital fund already serves multiple functions including debt repayment and cash funding of projects. Several council members urged periodic formal review of the new policy and suggested adding stewardship triggers for the capital fund.

Following the debate, the council passed Resolution 13-2025 (requesting an advance of funds from the Franklin County Treasurer) and Resolution 14-2025 (adopting the Financial Policy Committee recommendation regarding reserves). The record shows at least one recorded nay on Resolution 14-2025. Resolution 15-2025 (establishing a facilities maintenance reserve in the general fund) was introduced for first reading and scheduled for second reading and action at a later meeting.

Next steps: staff will continue to refine the 2026 budget, provide additional breakdowns of community center usage by residents and nonresidents, and prepare ordinance language and administrative procedures to implement the new reserve accounts for council consideration at future readings.