Lancaster presents $74.8 million recommended budget with new hires, utility and fee increases

Matt Hatcher, introduced at the meeting as the budget presenter, unveiled the city’s recommended fiscal 2025–26 budget and said the total is "Total $74,775,500." The presentation outlined personnel additions, proposed rate and fee changes, and several large capital projects, and set a public hearing for June 24 at 7:00 p.m.

Why it matters: The plan would fund a citywide compensation‑alignment adjustment, add public‑safety and maintenance positions, and raise recurring user fees that affect households, businesses and utility customers. Hatcher framed the package as a mix of grant‑funded hires, targeted salary increases and revenue adjustments intended to preserve reserves while financing multi‑year infrastructure work.

The most immediate changes in the recommended budget are personnel and pay adjustments. Hatcher said the proposal fully funds the recent compensation study recommendations and distributes the cost across funds: "the recommended budget fully fund all of the case study recommendations," a package he later estimated at about $643,581. He said 24 employees already at market would receive a 1% adjustment and the remaining employees would receive an average increase of about 7.7% citywide; public works and solid waste job classes would see average increases near 11.7%.

The personnel line also includes new hires for public safety and city operations. Hatcher told the council the recommended additions include six new police department positions — three of them school resource officers that the department has applied for a grant to fund — and three grant‑funded roles (a gang investigator, a community liaison sergeant and a program coordinator) supported by a three‑year CVIP grant that he said has already been awarded. The fire department request includes three new firefighters, "That's 1 for each shift," Hatcher said. The budget also lists an equipment operator for streets and new permit‑office staff to handle increased workload.

Revenue, tax and fee changes. Hatcher said reassessment required a millage rollback under state law and that applying the city's allowable increase under Act 388 (he cited a 5.65% allowance) produced the millage used in the recommended budget. He presented example impacts: for a $100,000 residential property he calculated the city tax next year would be $189.20 — about $15.20 higher than the current year in the example — and explained why certain commercial classes could see different outcomes due to assessment factors.

To recoup credit‑card processing costs the budget proposes a 3% credit/debit usage fee for the gross revenue fund (water and sewer) and other fee categories; Hatcher said the fund had already paid roughly $317,000 in card fees through April. Utility adjustments in the plan include a $1 monthly increase in the sewer minimum and a 3% increase per 1,000 gallons; hauled wastewater and septic hauler rates would rise about 4%. On the water side Hatcher proposed a $1 monthly minimum increase and an infrastructure fee increase from $2.50 to $3.00 to help pay debt service on loans for major projects.

Capital projects and meters. The recommended budget lists a downtown water‑line replacement at $4,100,000, with staff planning to pursue State Revolving Fund loans, EDA grants and possible federal appropriations to reduce the local share. The plan also includes $3,300,000 for replacement of the city's water meters (advanced meter infrastructure), expected to be financed via a multi‑year lease purchase; Hatcher said the new meters should improve consumption readings and revenue collection.

Hospitality tax and local projects. The budget allocates $350,000 in hospitality tax CIP funds for farmers market design and placed engineering funding for downtown improvements; Hatcher noted he used reserves to balance hospitality tax this year and said roughly $600,000 is earmarked for Gay Street Commons design work, with a remaining need of about $200,000 to be covered by reserves.

Other fee changes noted in the presentation include increases to connection fees at the gross revenue fund, higher replacement‑connection charges, a rise in late payment penalties (proposed $5 increase to $30), higher delinquency charges for solid waste customers and a recommended $50 hourly off‑duty pay rate for police details for schools and nonprofits. Cemetery burial fees would increase by about 4% under an existing contract.

State budget impacts. Hatcher flagged a proposed state budget change that would increase the daily juvenile housing cost — a figure the city pays to county/state facilities — and said staff would estimate the local impact and, if required, add the cost to the next budget revision.

Public process and next steps. Hatcher said the recommended budget may be adjusted before first and second readings; he announced the public hearing will be published in the newspaper and held at 7:00 p.m. on June 24 prior to second reading, and said council may propose changes up to the formal vote. No formal action was taken at the special meeting; the presentation concluded and roll call confirmed attendance for the record.

What was said (representative direct quotes): Hatcher: "Total $74,775,500." Hatcher on personnel: "Personnel additions in this budget have 6 positions in the police department, 3 school resource officers..." Hatcher on card fees: "We're gonna put 3% on to recoup those costs." Hatcher on the hearing: "Public hearing will be at 07:00 on June 24." Mayor DeBene and council members participated in clarification and discussion but did not take a vote at this meeting.

The council will hear public comment at the June 24 hearing before second reading and a final vote on the budget.