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Council reviews draft 2025–27 budgets; staff warns of multi‑year deficits and levy options
Summary
Finance staff presented the first draft of the city and utilities budgets. Lower property valuations and large one‑time capital needs produce projected general‑fund deficits (FY26 gap noted at roughly $19M), prompting council discussion of reserve use, levy choices including a potential postcard meeting, and tradeoffs on funding major public‑safety and capital projects.
Finance Director Jennifer Nab presented the first draft of the City of Fremont’s 2025–27 budget materials, including the state budget form, revenue estimates, the capital improvement plan, and Department of Utilities schedules. Nab said county valuation figures produced a lower overall valuation than last year (despite 2.06% growth from new construction), which affects property‑tax revenue assumptions.
Nab and City Administrator Jody Sanders reviewed proposed levy options and explained the state’s 'postcard' requirement (a public notice procedure triggered by larger levy increases). The staff recommended a proposed levy of 0.26 for 2026; Nab said that adopting a higher levy tied to a 5.17% inflation index would require the postcard meeting but would also add revenue over multiple years.
Council and staff discussed the city’s use of reserves for one‑time capital projects and the projected gaps in the general fund: staff cited a planned use of reserves in FY25 and a much larger gap projected for FY26 (discussed as roughly $19M) driven primarily by capital projects such as the planned public‑safety buildings and other infrastructure. Nab noted that some revenue assumptions for FY26–27 rely on hoped‑for state or federal grants and bond issuances; councilmembers asked staff to identify program reductions, project delays, or revenue changes to close the multi‑year gaps prior to final adoption.
Council directed staff to refine the draft, provide clearer revenue/expenditure comparisons by fund and department, and present options (spending cuts, rescheduling capital, or levy alternatives) at the public hearing next week. No decisions on levy changes or capital project cancellations were made at the Aug. 26 meeting.
