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City presents balanced FY2025–26 budget with $18.5M in capital projects, demands 7% cuts
Summary
City staff presented the proposed FY2025–26 budget, saying fund restrictions and a shortfall in the general fund required a 7% across‑the‑board reduction; capital spending of about $18.5 million was included but council pressed staff on how to allocate $1 million earmarked for paving.
Presenter (speaker 5) opened new business by presenting the proposed fiscal year 2025–26 budget and described the process used to build it, including department head meetings and a budget retreat. He said the city manages roughly 15 funds, three of which are enterprise/user-fee funds (wastewater, stormwater, sanitation) and are legally restricted from being used for other purposes.
The presenter said the administration aims for a 30% operating fund balance for cash flow and reserves but that the general fund had been projecting nearer 22%–27% and required adjustments. “We had to cut every line item in the general fund…we cut it by 7%,” the presenter said, describing a package of reclassifications and reductions that together produced roughly $1.6 million in cuts and other fund shifts. He told the council that staff moved some items from the general fund into other eligible funds when legally allowable, and that capital projects totaling about $18,500,000 were included across various funds.
Councilmembers questioned where to find additional paving dollars and whether to reallocate restricted or semi‑flexible funds. The presenter outlined options he had considered: shifting money from the debt service fund (which had exceeded its 30% reserve target), reallocating portions of a park sales‑tax fund, and using up to $600,000 in State Street Aid set aside for paving. He cautioned that some funds are restricted by statute or policy and cannot be repurposed for general use.
On personnel, the budget retains some hires while trimming others. The package holds a proposed IT position and a finance customer‑service representative intended to reduce future contractor costs, while some requested public‑safety positions (a police officer, a firefighter and a building inspector) were not funded this year. Finance staff said prior pay increases and overtime practices materially affect personnel costs and that detailed payroll line breakdowns would require follow‑up.
The presenter told the council the budget ordinance would be presented for first reading in a few weeks and defended the administration’s approach to balancing competing departmental needs without proposing a property‑tax increase at this time. He said staff would return if midyear fund balances proved stronger than projected to consider restoring or advancing some capital projects.
The council did not vote on the budget at the meeting but directed staff to modify a capital line‑item description to capture both Pleasant Grove Road and Wilkinson Lane cluster work for clarity before the first reading.
