Kingsport adopts $114 million budget and new water, sewer and stormwater rates

Kingsport’s Board of Mayor and Aldermen on June 16 adopted a balanced $114 million general fund budget for fiscal 2026–27 with no tax increase and approved new water, sewer and stormwater rates that city officials said are needed to fund major infrastructure work.

Deputy City Manager Ryan McReynolds, presenting the utility enterprise plan, said the proposed rate changes are driven by capital needs across a system that serves about 100,000 people and includes roughly 900 miles of pipe. “The bulk of it goes to what we call our CIP — fixing, maintaining and replacing infrastructure that in some areas is more than 100 years old,” McReynolds said.

The board approved the enterprise budgets and the rate ordinance on roll call votes. McReynolds detailed example impacts for typical customers: a low-volume residential account would rise from about $34.64 to $37.12 monthly, an average customer from $62.42 to $66.57, and a high-usage household from $90.20 to $96.03, reflecting both base-rate and volumetric adjustments. He also cited a $3,000,000 distribution investment planned for next year and other treatment-plant projects drawn from the city's water/wastewater master plans.

City Manager Cimander described the general-fund budget as balanced without a proposed tax rate increase for the main Kingsport property tax jurisdiction; staff forecast roughly 1% revenue growth and emphasized a focus on personnel needs and capital projects. The budget includes a recommended 3% cost-of-living adjustment for staff and recurring funding for body-worn cameras for police ($350,000 per year).

McReynolds said the utility program responds to prior financial pressure and oversight: after a period when expenses outpaced revenues the city entered a financial review with the state wastewater board and adopted a multi-measure stabilization plan — including improving debt-service coverage and rebuilding fund balance — to restore long-term sustainability. He encouraged board members to raise further questions when the city’s consultant Raftelis presents more detail in the fall.

The board opened public hearings on the enterprise and general-fund budgets; no members of the public spoke. On votes recorded by roll call, the budget and rate measures passed unanimously.

Next steps: the utility rates take effect July 1, 2026; staff said they will continue work on the capital improvement program and follow-up consultant briefings for board review.