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Budget debate: CPA flags low interest-income projection; staff cites fund accounting; city approves FY25–26 budget
Summary
A committee member raised that the budget’s interest-income estimate ($338,000) is far below last year’s actuals (~$1,064,000); staff explained fund-by-fund accounting and timing effects. After discussion the council approved the FY25–26 city budget and related urban renewal budgets.
A committee member who identified himself as a CPA told the budget committee that the proposed budget understates expected interest income, citing 2024 audited results showing about $1,064,000 in interest versus the proposed $338,000.
"The actual in 2024 was a little over $1,064,000," the committee member said, and suggested there might be an opportunity to add roughly $700,000 to the proposed interest revenue. Staff responded that interest allocation is calculated fund-by-fund across 31 funds, uses a rolling-average approach, and can vary with large one-time purchases or project timing; that means recognized interest in a budget can differ from audited, year-later results.
The committee also discussed electric fund projections and how cost-of-goods accounting and tiered power pricing could affect expense lines. Staff said they built conservative numbers to ensure the city could afford its power purchases and noted several budget complexities including salary increases, rebate programs, and multi-year budget cycles.
Following the discussion, Madeline moved to approve the city budget for fiscal year 2025–26; the motion was seconded and the Chair recorded the budget as approved. The committee then approved the city’s urban renewal agency budgets; the Chair later noted two opposed votes on the urban renewal motion (Bruce and Gordon).
