Horace council sets Sept. 22 public hearing and approves preliminary 2026 budget

The Horace City Council approved a preliminary 2026 budget on Aug. 4 and set a public hearing for Monday, Sept. 22 at 6 p.m.

Matt, the presentation lead, said the city's preliminary general fund for 2026 is about $4.8 million, an 11% increase over FY 2025; staff proposed a 2.5% cost-of-living adjustment and a cap on merit increases of 4%, and recommended one additional full-time position (an assessor / special-assessments coordinator). He noted the preliminary levy is constrained by House Bill 1176, which limits dollar-levy increases to 3% over the prior year plus new-growth allowances.

The presentation included proposed utility rate changes to address operating shortfalls and rising vendor costs. Staff said the city's bulk water cost from its wholesaler is increasing from $4.25 to $5.40 per 1,000 gallons (a 27% increase), and proposed a water-rate change that would raise the example average household bill from roughly $56.20 to $69.70 (about a 24% increase) while covering operating costs. For sewer, staff proposed moving from a tiered structure to a flat $32.50 monthly rate to cover operations and restore capital funding.

Council discussed capital purchases (snowplow, skid steer) and the possibility of financing. Staff proposed transfers to reserve funds to reach a 100-day reserve target and listed capital priorities funded by sales tax dollars.

The council voted to approve the preliminary budget and set the budget hearing date for Sept. 22, 6 p.m. Staff will publish the budget materials on the city website and return for final adoption after the public hearing and any adjustments that do not exceed levy caps.