February financial report: sales-tax up short-term, leaders warn expenses must be watched

Finance director Shelby presented the February 2026 financial report, noting sales-tax receipts were up about 11 percent year to date compared with the same period in 2025, but cautioned that data reflect only two months of collections (and a two-month reporting lag).

"Year to date through February compared to prior years, we're experiencing an 11% increase in sales tax," Shelby said, adding that February collections reflect December sales activity. She broke down February sources: retail made up about 40 percent of sales tax (retail has shown a modest average decline since 2023), services comprised roughly 27 percent and have shown steady growth, and construction accounted for about 20 percent of February’s total and rose sharply compared with February 2025 because of several large local projects.

Shelby said utility-tax receipts rebounded in February (she cited a $407,000 month compared with an average monthly figure of about $341,000), and overall general-fund revenues year to date are approximately $200,000 higher than at the same point in 2025. On the expense side, Shelby said the city has spent about 14 percent of its annual budget year to date and emphasized leaders will continue cost-reduction efforts and update 10-year projections.

Council members acknowledged the mixed signals: they welcomed the sales-tax gains but agreed expenses must be monitored and reduction plans implemented. Shelby noted an upcoming council retreat and said staff will refine projections and reduction strategies there.