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Staff frames FY 2026–27 budget as a starting point; flags utility-rate review, capital needs and insurance increases
Summary
City staff presented a preliminary FY 2026–27 budget showing an initial net surplus and proposed next steps including departmental presentations, a possible utility-rates workshop, and attention to capital needs (JLK roof, Robinson Park restrooms) and insurance renewals.
City staff provided councilors with a preliminary FY 2026–27 budget overview, describing it as a baseline that does not assume any additional priorities the council may set and outlining next steps for departmental presentations and possible rate discussions.
DeGrathmeade, a city staff member, told councilors, “This is a budget that does not take into account or assume anything that council might see as a priority,” and said staff aimed to give the council a safe starting point. He reported an initial net budget surplus in the neighborhood of $176,000 and said the utility fund’s available surplus is smaller, by roughly $60,000–$80,000 compared with the previous projection.
Staff noted several items for council consideration: moving the airport fund to a non-operating fund to honor grant assurances; possibly using some council-restricted fund balance for water-quality or paving projects; evaluating utility rates in a workshop; and addressing capital needs including the JLK roof, Robinson Park restrooms, and equipment such as a vac truck and a mid-size excavator. Staff also reported moving about $165,000 previously budgeted for a water/wastewater director's salary into contingency and said retaining that staffing capacity should remain under consideration as priorities are set.
On insurance, staff said the renewal for the same coverage was presented at a 12% increase even though the budget had assumed a 10% increase; staff asked whether council wanted to accept proposed options. Regarding the LCAB budget process, staff noted LCAB will hold a public hearing on July 13 and provided a comparison spreadsheet of LCAB’s FY26 approved budget and FY27 proposed figures.
Staff suggested departmental presentations begin at 5:30 p.m. on the 22nd; one speaker noted that the 22nd is a Sunday, indicating schedule confusion that staff should confirm. Staff also praised public-works crews for quickly clearing right-of-ways after a weather event, saying they "cleared the right of ways completely, and had it done in 4 or 5 days," though the transcript gives the amount spent as "about $4," which is ambiguous in the record and requires confirmation.
Next steps: departmental presentations and a possible utility-rates workshop; staff will return with options for funding council priorities, including potential use of fund balance, bond funds or rate adjustments.
