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City manager frames FY27 budget amid slowing inflation; staff recommend 2.7% COLA for stormwater fee
Summary
City manager briefed commissioners on national and local economy indicators and inflation since 2019 (~26%). Public works proposed a 2.7% COLA that would raise the stormwater fee from $3.75 to $3.85/month to close a projected shortfall, and commissioners discussed constrained paving funds and municipal road aid formulas.
At the March 24 commission meeting the city manager walked commissioners through national and local economic trends ahead of the FY27 budget cycle, and public‑works staff outlined a proposed small fee increase to shore up stormwater revenue.
The city manager summarized slides showing the probability of recession has declined to below 20% since its COVID spike, noted the U.S. consumer price index and that “overall inflation since 2019 is up 26%,” and highlighted local impacts in energy, transportation and groceries. He said those trends factor into decisions about the city’s revenue projections and operating budgets.
Public services staff presented stormwater revenue estimates and options. With stormwater revenue projected near $710,000 and several non‑personnel costs rising, staff said granting a cost‑of‑living adjustment (COLA) of 2.7% would raise projected stormwater revenue enough to cover a small shortfall; the specific proposal discussed would raise the stormwater fee from $3.75 to $3.85 per month.
Commissioners questioned the durability of municipal road aid and expressed frustration that state formula changes have not kept pace with rising paving costs. Staff said Danville receives about $360,000 a year from the municipal road aid fund and outlined how increased paving costs and flat gas‑tax allocations reduce the city’s ability to maintain streets at prior levels.
No formal vote was taken on the stormwater fee during the March 24 presentation; staff will advance fee and budget options through the regular budget calendar, with community‑agency and departmental hearings scheduled in the coming weeks.
Budget next steps: staff recommended commissioners review baseline operating and revenue estimates in the next meeting cycle and decide whether to include the proposed COLA and any ordinance changes (including potentially embedding an annual COLA into stormwater ordinance) before finalizing the FY27 budget.
