Oak Ridge council approves FY2027 budget on first reading, adopts several line-item amendments

Oak Ridge Mayor Gooch presided as the council approved the city's fiscal year 2027 budget on first reading and adopted multiple line-item amendments, including actions for the Emergency Communications District (ECD), the school system and the Waterworks fund.

The council first met as the Oak Ridge Emergency Communications District Board and approved a net-zero amendment to the ECD's fiscal 2026 budget aimed at reallocating line items so the district complies with TCA line-item adoption requirements. Finance Director Carrie said the amendment shifts funds so the contracted dispatcher services appropriation increases by $100,000 (from $200,000 to $300,000) while reducing other categories such as vendor services, small equipment and depreciation. "It's a net 0, so we're not changing the bottom line or adding or subtracting funds, but we are just moving it to where it needs to be so that we can pass the audit," the finance director said. The board opened a public hearing, received no public comment, and adopted the amendment by roll-call vote (five ayes reported).

The council then convened for the city meeting, where members considered a substitute ordinance to amend Ordinance 16-25 and three distinct budget amendments. The substitute incorporated the ECD amendment, a $300,000 school budget increase tied to a grant, and a $515,000 amendment to the Waterworks fund related to tank rehabilitation that staff said is maintenance (moved from capital to operating). The council opened and closed a public hearing with no speakers and approved the amendments by roll call (five ayes reported).

On the FY2027 budget itself, a presenter introduced the plan, titled "Maintaining Momentum," and highlighted no tax increase alongside a larger overall spending plan to accommodate capital needs, grant-funded projects, and organizational capacity. The presentation outlined proposed staffing changes (roughly six full-time positions, several reclassifications, and a part-time communications specialist), equipment replacements, and a revised equipment and rental replacement fund structure designed to improve transparency and budgeting.

Finance staff described several numerical highlights: the audited base used for comparison in fiscal 2025 was reported as $59,000,005.10 and the FY2027 proposed total was presented as $70,000,002.29; grants were shown increasing from 37 grants (~$42 million) to 44 grants (~$59 million). Staff said the city expects to replace about 12 vehicles in the general-fund fleet this year (approximately $780,000) and to include three fire pumper trucks in the operating budget. A proposed compensation plan includes a 2% step increase and a 3% cost-of-living increase; staff estimated the compensation changes at roughly $446,695 in aggregate and an implementation cost of about $20,000 for pay-grade changes.

The finance director outlined a planned debt issuance of roughly $16.8 million (all-in about $17,095,000) to fund the animal shelter, Fire Station No. 2 and associated pumper trucks; staff said the interest rate is expected to be near 4% and the term around 20 years. Staff said bond-rating firms (Moody's and S&P, contacted through consultant Davenport) did not anticipate a material effect on the city's rating from the issuance.

Council members also pressed staff on electric-system investments tied to new large customers and economic-development projects. Staff identified four large transformers for near-term projects (two for RONO and two for TRISO X/BWXT) and said developers will enter agreements to pay for the system expansions that exclusively serve them, noting the city does not want to shift those costs onto general ratepayers. Utility staff said the city is pursuing grant opportunities (including a letter of intent to the Appalachian Regional Commission for $2 million) and in some cases will acquire surplus transformers from other utilities to shorten lead times.

On metering, staff said a $775,000 phase would complete an automated meter infrastructure (AMI) rollout that would cover residential, commercial and industrial meters and allow remote connect/disconnect capability.

Finance staff warned the Waterworks fund currently has limited capital funding and recommended careful prioritization. The council heard that the city conducted a 2025 cost-of-service study (Jackson Thornton) and plans follow-up studies in 2027 and 2029; staff said the waterworks must maintain a minimum of two months of operating cash and may need a higher fund balance in the future.

Council approved the FY2027 budget on first reading and scheduled a second reading for next Monday. The meeting adjourned after the vote.

Votes at a glance - ECD FY2026 budget amendment: adopted (roll call reported as five ayes, no nays) - ECD FY2027 line-item budget: adopted by the board (roll call reported as five ayes) - Amendments to Ordinance 16-25 (three amendments including schools and waterworks): approved (roll call reported as five ayes) - FY2027 budget: approved on first reading; second reading set for next Monday

What happens next The ordinance will return for a second reading next Monday; staff said bond-rating agency briefings and additional policy work (fund-balance, investment and debt policies) are planned before any debt issuance is finalized.