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City manager outlines FY27 revenue shifts: downtown TIF payoff, waterfront subsidy and bag-and-tag phaseout
Summary
City manager presented revenue adjustments intended to offset property-tax pressure: the downtown TIF is producing increment the plan proposes transferring to the general fund; the waterfront TIF will receive a proposed $500,000 general-fund subsidy in FY27; and phasing out bag-and-tag sales is expected to reduce revenue by about $500,000.
The city manager briefed the council on key revenue items in the proposed FY27 budget and identified several policy choices intended to reduce property-tax burden while covering near-term obligations.
Downtown TIF: city staff said the downtown tax-increment financing (TIF) district now generates more than enough increment to cover its parking-garage bond, allowing the city to transfer the surplus into the general fund. "After 14 years, 6 years early, we were able to show that there's a significant return on that investment," the manager said, noting the plan could free funds for downtown crosswalk projects or other capital work while still preserving funds for the TIF's obligations.
Waterfront TIF subsidy: the manager proposed a $500,000 one-time transfer into the waterfront TIF to cover a shortfall in debt service for public improvements as that district matures. Staff characterized the waterfront TIF as early in its life cycle and likely to need initial subsidy over this and perhaps the next year.
Bag and tag revenue phaseout: the budget reflects an anticipated $500,000 decline in bag-and-tag revenue as the city phases out bag sales after 07/01/2027; the manager flagged this as a significant revenue change that city departments accounted for in the proposed plan.
Other revenue items: staff also cited a projected $175,000 increase from a new cable-franchise fee tied to a new provider in town, an estimated $300,000 increase in investment income, and about $500,000 higher ambulance revenue from contract changes and a new agreement with a neighboring town.
Budget authority and charter limits: the manager reiterated that the council's authority is generally bottom-line; per the city charter the council may reduce department personal-service line items at the department level but cannot pick individual positions directly — implementation decisions on specific posts remain with administration.
What happens next: staff said proposed transfers and subsidies will be reviewed in upcoming workshops and that the council will be presented with more detailed budget-book worksheets as the process continues.
