Morrisville manager presents balanced FY 2027 budget proposal, council debates reserves and recurring costs

Town Manager Brandon Zudema presented the town of Morrisville’s recommended FY 2027 operating budget and five‑year capital improvement program to the Morrisville Town Council at its May 12 meeting, saying the proposal balances competing priorities without raising the tax rate.

Zudema said the recommended budget holds the tax rate at 35¢ per $100 valuation, proposes a $57 million base operating budget and identified roughly $7 million in new community investments (many items funded in whole or part by grants or restricted sources). The recommendation includes a 1% cost‑of‑living adjustment for staff, continuation of merit funding, and 10 new positions phased across the year (five full‑year equivalents and several half‑year hires). “We recommend staying at 35¢ and making the most that we can with those available revenues,” Zudema told the council.

Why it matters: staff said recent property revaluation appeals reduced revenue by about $1 million in FY 2026 and that an additional $500,000 remains at risk if pending commercial appeals are sustained. Those appeals and an anticipated slowdown in natural revenue growth shaped a conservative approach to new recurring spending in FY 2027 and to the town’s use of reserves and fund balance.

Budget highlights and tradeoffs - No tax‑rate increase; tax rate remains 35¢ per $100 valuation. - Base operating budget: approximately $57 million. - New community investments shown as $7 million (presentation totals include grant and restricted revenue components; not all of the $7M is general fund dollars). - Use of reserves/fund balance: staff proposes modest use of reserves ($312,000 shown as transfers in and about $1.4M of planned fund balance use), while holding a $500,000 contingency in case appeals are resolved against the town. - Staffing: 10 new positions tied to public safety, town center activation and planning; 3 firefighter positions and 3 police positions were highlighted among hires. - Capital and grants: staff reported roughly $3.4M in awarded grants year to date and cited a projected $13M Morrisville Parkway project for which the town will seek about $10.5M in grant funding.

Council reaction and concerns Council members generally praised staff for a thoughtful presentation but pressed on the long‑term implications of adding recurring costs while relying on one‑time or grant revenues. Several members argued for fully funding reserve priorities (land acquisition, transportation and public safety) rather than committing limited revenue to new ongoing obligations.

Councilmember Johnson, who led a number of positive remarks about the presentation, said the format and outreach were helpful and urged continued public engagement as the budget proceeds to a public hearing. “We’ve always done better when we look at the base budget and highlight the investments our staff has already made,” Johnson said.

CFO and technical clarifications Byron (chief financial officer) and staff explained revenue line items, including restricted revenues (smart shuttle grant, fire tax revenue, Central Pines funding for an IT position) and other intergovernmental receipts. The presentation clarified that some new investments are funded by non‑general‑fund revenue streams or grants and that the town has intentionally held $500,000 out of anticipated growth pending resolution of appeals.

Votes and next steps At the meeting the council unanimously adopted a related economic development incentive policy (Resolution 2026‑146‑0) and unanimously approved installment financing (Resolution 2026‑152‑B) to support the public works facility renovation and acquisition discussed in the presentation. Staff noted a public hearing on the full budget set for May 26 and tentatively planned adoption for June 9.

What’s next: staff will host budget open houses May 26 and May 28 and present the budget at the public hearing May 26 before the council considers adoption on June 9. The council requested additional detail on fee changes and encouraged staff to provide requested data ahead of the next meeting.