Perry City manager proposes FY27 budget including 1.217 mill increase; council debates rate hikes and reserve strategy

City Manager Robert Smith presented the administration’s proposed FY27 budget to the Perry City Council, outlining priorities, proposed revenue adjustments and fund‑level changes that prompted extended council debate over rates, reserves and funding options.

Smith told the council the administration began budget work in December and is moving the process into a public phase, with a formal public hearing planned for June 2 and a proposed adoption in mid‑June. He said the FY27 packet was distributed to council and emphasized goals of fiscal stability, sustaining service levels and continued investment in employees.

Major proposals and numbers - Millage increase: Smith proposed a millage increase of 1.217 mills, which the administration estimates would generate about $1,421,500 to be dedicated to debt service for fire apparatus and sewer infrastructure. Smith framed the millage shift as a way to move some PPFA debt service off enterprise funds and onto ad valorem tax revenues. - Rates: The administration proposed a 2.5% consumption rate increase and a 5% account‑activation increase for water/sewer customers; a 4% increase for solid‑waste services was also proposed. The gas fund had no rate increase proposed. - Reserves and fund health: Smith said the general fund would finish the year with cash on hand and that the water/sewer fund would be at about 25% reserves under the proposal; he also listed a 48% increase in budgeted water purchases from Houston County because of county capital projects. - Personnel/cost controls: The proposal includes no employee‑benefit reductions or new positions, a proposed 1% cost‑of‑living adjustment, eligibility for merit increases and a narrowly scoped in‑classification pool; the staff also recommended freezing two positions and seeking operating cost reductions. - Contracts and contingencies: Smith recommended removing the Agility Recovery contract (noting a potential active cost of roughly $32,000 per month if used) and emphasized county and interagency partnerships as alternatives during emergencies.

Council reaction and debate Council members raised immediate concerns about the proposed millage and rate increases and asked administration to develop alternatives to preserve reserves. Mayor Pro Tim Peterson said he is “not in favor of any rate increases or … millage increases” and urged that staff rework the budget to avoid immediate rate and fee hikes. Peterson presented arithmetic based on the materials showing differing deficit scenarios depending on whether depreciation is treated as a cash expense and suggested SPLOST or other one‑time sources as alternatives.

Other councilors said they understand the pressure of rising operational costs — for example electricity and fuel — and cautioned that deferring needed revenue changes risks a larger, more painful increase later. Several members asked staff to return with additional options, including further operating cuts, use of restricted SPLOST funds for debt where legally allowed, and more detail on possible impacts to customers.

Quotations - City Manager Robert Smith: “We are proposing a millage increase of 1.217 mills which would generate $1,421,500 and that would be committed directly to the debt service that I mentioned for the fire apparatus and sewer infrastructure.” - Mayor Pro Tim Peterson: “I am not in favor of any rate increases or or um fee increases or at this point even millillage increases.”

Next steps and process Smith said staff will take the council’s feedback, pursue additional line‑by‑line reductions where feasible, and return with revised options during the public hearing process. The administration plans to continue stakeholder outreach and department reviews between now and the June hearings. The work session concluded with a motion to go into executive session for personnel matters.