Budget presenter Robert outlines five-year forecast; council adopts 5.5% property-tax growth assumption

Robert (Speaker 4), the staff presenter on the five-year forecast, told the council the study session was a high-level kickoff for the FY 26–27 budget and that operational and CIP details would be addressed at later meetings. He summarized midyear estimates for FY25–26, noting projected expenditures of about $22.7 million and a projected year-end unallocated balance after reserves.

Robert said the town’s general fund relies heavily on property taxes — “62% is, of our general fund revenues, property taxes” — and warned that below-the-line adjustments and county BLF (below-line funding) shortfalls have produced multi-year gaps totaling roughly $1.7 million over recent years. He also reviewed the town’s COP (certificate of participation) lease obligations and the staff decision not to exercise a call option, explaining that the COP will be fully paid according to schedule.

Council members probed specific assumptions. Committee member (Speaker 3) asked that election-year council costs be reflected in the forecast and requested that franchise-fee changes be incorporated; Robert agreed to update the five-year forecast to reflect those items. Council members also debated the property-tax growth rate to use in projections: staff presented a range from roughly 4% to 5.5% over the five-year horizon.

Committee member (Speaker 7) argued staff should use a higher projection based on historical performance, while others urged a more conservative approach given slowing growth and fewer developable parcels. After extended discussion — with members noting both the town’s current reserve position and the need to keep year‑one and year‑two estimates close to reality — the council settled on a 5.5% property-tax growth assumption for the forecast, with an agreement to monitor actual collections and adjust at midyear if needed. As one member summarized, “So we go with 5.5,” signaling consensus to adopt that assumption for planning purposes.

The presentation also recapped reserve policy (15% emergency and 15% contingency) and the proposed budget calendar: division-level operations review, a capital budget discussion in May, and final adoption in mid-June. Robert and council members noted that some items — including the timing of actuarial adjustments tied to a recent $3 million pension payment — will be reflected in later actuarial reports and may change projections in subsequent years.

The council asked staff to: update the five-year forecast for franchise-fee changes and election-year costs; confirm the actuarial timing and effect of the $3 million pension payment; and present any required midyear budget adjustments when updated county or state revenues (including BLF adjustments) are received. The session continued into a separate audit and enforcement discussion later on the agenda.