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Alamosa staff outline $5 million 2026 shortfall as capital projects and wastewater needs drive spending
Summary
City staff told council the proposed 2026 budget projects $41,875,649 in revenue against roughly $47 million in expenditures, a gap driven largely by continuing capital improvement projects and looming wastewater plant work; staff raised the possibility of a utility sales-tax renewal to fund future treatment-plant needs.
The city manager opened the Alamosa City Council work session with a 2026 budget overview showing projected revenue of $41,875,649 and planned expenditures near $47 million, producing an approximate $5 million gap largely attributable to capital improvement program (CIP) projects continuing from 2025 and new capital commitments.
Staff said the difference is concentrated in capital spending, with the enterprise fund carrying particularly large long-term obligations. "We do still stay above that blue which is the minimum fund balance that we need to have," the city manager said while noting a ‘‘scary’’ enterprise-fund projection around 2033 tied to wastewater treatment-plant improvements.
Why it matters: staff framed the shortfall as a funding-timing and capital-planning issue rather than an immediate operational crisis, but warned that major utility projects could force the city to seek voter approval for a renewal of a utility sales tax or otherwise defer work. The city manager said the city could attempt to push or phase projects but that absent new revenue mechanisms the timing of critical wastewater investments is uncertain.
Supporting details: staff presented a 10-year forecast and estimated that the general fund would see a roughly $2 million reduction in fund balance in 2026 while the enterprise fund would drop by about $2 million; capital projects account for the majority of the difference between revenues and expenditures. Staff called out the need for significant wastewater treatment improvements and said the city is likely to consider a renewal of the utility sales tax to help fund those upgrades.
Council reaction and next steps: councilors asked technical questions about the forecast series and reserve assumptions and were briefed that staff may not need a second budget work session depending on progress. Staff said they will continue to refine the CIP timing and present options for balancing the 2026 budget, including revising project timing, pursuing grants, or proposing revenue measures.
The meeting closed with staff saying a second budget work session may be unnecessary but noting follow-up items for CIP sequencing and a rate analysis for utilities in 2026.
