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Lindsay releases preliminary FY 2026–27 budget wish list; city flags revenue pressures and overhead changes
Summary
City staff presented a third-quarter budget update and a preliminary FY 2026–27 budget 'wish list,' noting a projected general-fund revenue shortfall, overhead accounting changes that shift salary allocations into the general fund, and pending grant reimbursements that affect reporting; staff will return a balanced budget for council action in June.
City staff presented a third-quarter budget review and an initial budget workshop for fiscal year 2026–27, warning council that planned department 'wish lists' exceed projected revenues and outlining steps to balance the budget.
The finance presentation reported $9.1 million in budgeted general-fund revenue for the current fiscal year, with $6.2 million received through the third quarter; sales tax receipts were forecast to be about 5% below prior projections, a shortfall staff said equates to roughly $200,000. On the water side, staff noted $3 million in grant-funded well work is budgeted but not yet expended or reimbursed, so operating revenue metrics look lower until grants are realized.
Staff described a change in accounting: moving from direct allocation to overhead for departmental salary and benefit charges. The change brings full departmental personnel costs together in the general fund for clearer transparency, but the move will make some departments (notably finance) appear larger because previously their personnel costs were spread into enterprise funds.
The city manager and finance director walked through the budget timeline: departments submitted "dream" budgets and detailed line items; staff will continue to refine department requests, present a revised budget in May, and bring a final balanced budget to council for adoption in June. Staff also outlined capital needs including Well 11 rehabilitation (presented as a multi-million-dollar project), a transit center, pool deck repairs and other infrastructure projects; many of those projects rely on grants or future financing because revenues are insufficient to fund all wish-list items.
Council members asked for further detail on the council budget line and urged prioritization of needs over wants. Staff emphasized the draft is a starting point and that the final budget will be adjusted to match realistic revenue projections, including accounting for one-time monies such as a recently received $400,000 retrospective insurance refund.
Ending: Staff will continue outreach to refine priorities and will return to council in May and June with updated, balanced budget proposals.
Quote: "This is our starting point — these are wish lists," the Finance Director said, "we will adjust the budget to match our revenues and prioritize staffing and capital needs."
