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SLDC staff outlines FY2027 budget plan, projects $11.2M in revenue and $17.8M in spending
Summary
Staff presented a FY2027 draft that estimates $11.2 million in revenue, proposes $17.8 million in expenditures (including $5.6M in incentives and $2.5M capital projects), and shows a projected drawdown of about $6.6M with a beginning fund balance of roughly $22.5M; board discussion focused on incentive capacity, debt and the Imperial/Track 2 site.
At a workshop, Justin Majorado, assistant director of budget, briefed the Sugar Land Development Corporation on the proposed fiscal year 2027 budget and the fund’s financial position.
Majorado said year-to-date sales tax collections were performing stronger than expected; staff’s year-end estimate for FY26 is about $10.3 million, roughly $800,000 (about 8%) above the original budget. Using a new data-driven forecasting methodology that incorporates inflation, home sales, unemployment, building activity, gas prices and seasonal trends, staff’s FY27 revenue estimate is approximately $11.2 million (about $10.5 million from sales tax and ~$700,000 from interest income).
The draft FY27 spending plan totals about $17.8 million: roughly $7.8 million for operating programs and strategic initiatives (including $5.6 million in performance-based incentives, $300,000 for FIFA sponsorships and $260,000 in one-time zoning-code modernization), $4.6 million in transfers (including reimbursements to the general fund and debt service), $2.5 million in capital projects (street rehabilitation and LED lighting replacement) and $2.5 million in debt service. Staff also proposed $1.0 million reserved for opportunistic investments.
Board members raised questions about the sustainability of annual incentive spending given a projected drawdown (staff cited a projected FY27 drawdown of about $6.6 million), the floor for the fund balance and potential additional commitments for the Imperial/Track 2 redevelopment site. Majorado presented a five-year forecast showing the fund returning to positive change near FY31–FY32 under current assumptions but noted that additional, large near-term commitments (such as Track 2 infrastructure) would require reevaluation of available capacity and could necessitate adjustments to the incentive line or other allocations.
Majorado said staff will file the budget with the rest of the city’s budget schedule on July 21; the SLDC is scheduled to return to the board for approval on September 1, and the council will see the proposed budget on August 20.
No formal budget adoption occurred at the workshop; board direction focused on questions and requests for additional details on debt, incentive capacity and thresholds for any major site initiatives.
