Rexburg finance chief lays out proposed 2027 budget and rate changes, urges public hearings

Rexburg’s chief financial officer, Matt, briefed the City Council on the proposed 2027 budget on June 17, saying the current $95.3 million figure is a starting point that will be reduced during amendment and public hearing processes. He told the council the operating budget is roughly $43 million, with the general fund about $20 million and a projected carryover requirement of $735,000 to balance the books.

Matt said one driver of the headline change was removal of intergovernmental fire/ambulance budgets and a $5.2 million donation tied to an ice rink that must appear in the proposed total. He also pointed to a 22.5% estimated increase in health insurance costs that the city is considering putting out to bid and a proposed 2.73% cost-of-living adjustment for staff.

The presentation detailed revenues and reserves: property tax growth of roughly 5% driven primarily by new construction (state statute allows a 3% base increase; the additional 2% reflects new growth), flat sales tax estimates, and notable carryover erosion in capital reserves for streets and sewer. Streets were shown with about $22.5 million in projects funded by carryover, federal grants, and urban renewal; staff warned of an anticipated roughly $900,000 reduction in fuel-tax funding next year.

To manage a roughly $1.8 million shortfall from unvetted budget requests, staff recommended targeted cuts and adjustments that would reduce the gap to about $734,000 and leave the general fund reserve below policy targets (roughly 21% versus a 25–33% policy band). Proposed measures include trimming contingency, reducing some capital set-asides, and asking departments to pare nonessential event spending.

Matt also described planned utility rate and capacity-fee changes based on an AIC rate study. Staff presented scenarios that would raise typical monthly household bills modestly and increase single-family capacity/impact fees substantially (for example, water connection fees were shown rising materially in the proposed schedule). He stressed the need for careful communications and public hearings: the city will advertise the budget and hold a public hearing on July 15, with additional hearings for amended budgets and for utility-rate ordinances.

Council members pressed staff on the detective position requested by the police department, and Matt and the mayor suggested asking the police to pursue grants and internal reprioritization before adding general-fund personnel this year; any hire left unapproved could be revisited with a budget amendment in October. Matt said the administration had included roughly $190,000 in next year’s budget for a planning study to evaluate options for municipal facilities and that staff and council would come back with refined proposals.

The council authorized publishing the required budget notices and agreed to proceed with the public hearing process and three readings of any resulting ordinances. The CFO said further budget adjustments would be returned to council for approval as staff validates grant awards and other revenues.