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Clayton council adopts FY2026-27 budget after staff warns of utility cost pressures and $150 million in capital needs
Summary
Council approved the FY2026-27 budget and related ordinances following staff presentations on utility rate drivers — a 4.5% Duke Energy power charge (staff said it equates to about a 2.5% overall budget impact), a 10% county bulk-water charge and roughly $150 million in near-term capital projects — and plans for cost-of-service and rate studies later this year.
The Clayton Town Council adopted the town's FY2026-27 budget at its June 15 meeting after extended staff presentations and council deliberation about utility-rate pressures and capital needs.
Town Manager Rich Coppola summarized months of budget work and the sequence of public engagement leading to the hearing. Coppola said the electric side received a "4 and a half percent power charge" notice from Duke Energy and explained how that power-charge change would "equate to pretty much a 2 and a half percent increase in the overall budget." He also said staff received a consultant's analysis estimating roughly $150,000,000 in capital projects over the next five years and stressed that large water-supply investments are a primary driver of future rate pressure.
Coppola and staff described the mechanics of rate modeling for water, sewer and electric services, and noted a county bulk-water increase of about 10% that applies across rate classes. Staff told the council it will run parallel cost-of-service studies: a water-and-sewer-specific study and a broader townwide service-cost review, with scoping expected this fall.
Council members discussed the base-budget methodology for rolling three-year averages, department-level tracking, and the timing of any in-town/out-of-town rate adjustments for industrial customers. Several council members expressed that the budget had been thoroughly vetted through workshops, midyear reviews and added public-engagement opportunities.
A council member moved to adopt ordinances numbered 2026-06-02 and 2026-06-04 (the FY2026-27 budget and associated rate ordinance); the motion was seconded and approved by voice vote.
The manager said staff will continue to provide updates as the cost-of-service studies proceed and report back to council with any recommended rate adjustments or implementation plans.
The budget adoption preserves current property-tax levels while adjusting utility rates to reflect external cost increases and planned capital investments; council members emphasized the ability to amend the budget during the fiscal year if conditions change.
