Council presses administration on shrinking one-time funds and fund-balance math

Councilors pressed city staff for more detail about one-time funds and how audited fund balances and policy floors feed the budget. The exchange focused on how the administration calculates available one-time money, why the proposed FY2027 budget appropriates about $1.9 million in one-time uses and why that is lower than prior years.

Joel explained that audited ending fund balances and a ‘‘waterfall’’ policy determine what becomes available for one-time appropriations: first satisfy the 15% unassigned fund-balance floor, then split excess 50/50 between capital reserves and one-time uses, and finally set aside a budget stabilization share within the one-time pool. “We are fully exhausting in the proposed budget the one-time use model,” he said, describing how the administration is not assuming projected unclosed balances until the audit is complete.

Alderman Savage asked whether the smaller one-time pool “really limits the council’s ability to get one-time things funded,” saying zero or limited unallocated one-time money makes reallocation or new discretionary projects difficult. Joel and other speakers replied that conservative budgeting and the timing of audits reduce the amount administrators can responsibly appropriate in the initial proposal.

Alderwoman O’Neal noted that COVID-era allocations had spending deadlines (FY2025) that produced a large one-time outlay between FY25 and FY26, which affected the year-over-year comparisons. Staff committed to provide more detail on the list of one-time appropriations in the all-funds summary and to answer follow-up questions about vacant positions, mayoral appropriations and items included in the mayor’s proposed allocations.