Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Municipal Budget topic
No spam. Unsubscribe anytime.
City staff outline balanced near-term budget, warn of out-year gaps as UUT sunsets
Summary
Finance Director Kristen Lee presented a draft 2026' 2028 biennial budget showing roughly $94.8 million in estimated general fund revenue for FY2025'6 and a healthy reserve position, but staff warned long-term spending on personnel, pensions and the scheduled Utility Users Tax sunset in 2029 will create operating gaps unless policy changes are made.
City staff presented the draft 2026' 2028 biennial budget and a five-year financial forecast to the council on May 28, saying the near-term plan is balanced but long-term pressures will narrow margins.
Finance Director Kristen Lee told the council estimated general fund revenues for the year ending June 30, 2026 are about $94.8 million and estimated expenditures about $89.7 million, excluding transfers and designations. The city continues to meet its 30% emergency and fiscal-uncertainty reserve policy and the staff proposal includes strategic transfers into pension stabilization (Section 115 trust) and capital/designation accounts.
Lee and City Manager Benoon emphasized long-term risks: personnel and pension cost growth and the scheduled sunset of the Utility Users Tax (UUT) in December 2029. The staff five-year forecast shows operating deficits widening in later years unless additional revenue or cost reductions are implemented.
The city proposed several modest budget additions to align resources with priorities: personnel requests include community service officers (CSOs) for police prisoner transports, two recreation specialists and an entry-level planner (to reduce contractual plan-review costs). Non-personnel requests include a pilot to expand street sweeping, a limited-term capital projects manager charged to projects, recruiting and background-investigation software, an expanded StarChase GPS pilot for patrol vehicles, and a third police K9 unit.
Council members asked detailed budget questions about vacancy assumptions (staff used a 10% vacancy factor), top-step salary budgeting (staff budgeted at top step to remain competitive), pension trust usage and which reserves are flexible. Some council members stressed the need to grow local revenue and improve permitting and mall conditions to support long-term finances.
Council also debated council compensation; staff presented options (4.0%, 5.2%, 7.5% and up to a 10% statutory cap). After discussion the mayor asked staff to include a 7.5% increase in the draft budget for council consideration; some members opposed any increase given out-year risks.
Next steps: staff will refine the budget and return June 25 with the final draft for adoption; if approved, the biennial budget would take effect July 1.
