Purcellville council deadlocks over FY26 budget; options include tapping reserves or raising utility rates

Purcellville’s Town Council spent hours May 27 debating a revised FY26 budget that would rely in part on drawing down general‑fund reserves and shifting meals‑tax revenue into the water and wastewater funds.

Town Manager Kwezie Frazier presented two approaches the administration modeled: an initial plan that would withdraw about $1.6 million from reserves and an alternative that uses a lower meals‑tax transfer (60 percent) and a smaller draw on reserves. "At 60% you only had to withdraw 1,200,000 from the general fund," Frazier told the council as he explained the staff analysis and tradeoffs.

The measure of how to cover the gap — use reserves, move meals‑tax revenue, cut staff or raise utility rates — split the council. The presiding officer noted the town’s reserves were substantial: "We have 5,800,000 over and above [the policy limit]," the official said, urging a plan for replenishment if reserves are used.

Other council members pushed back. Council member Wright said political decisions by a subset of the council had produced the current negotiation and argued members must own the consequences of prior votes. "So the only people to blame about this are the individuals that put us in this spot," Wright said during deliberations.

Staff also recommended some service and staffing reductions, and proposed phasing a wastewater screening project to push roughly $750,000 into FY27. Outside consultants cautioned that deferring portions of the wastewater work could raise costs by an estimated 10.83 percent in a year and add mobilization expenses, reducing or eliminating the near‑term savings.

Councilmembers repeatedly raised operational and regulatory concerns about proposed FTE cuts, naming positions that staff said are important for permitting, laboratory sampling and long‑range planning. Frazier and department heads said some risk could be managed by monitoring, temporary outsourcing of lab work and reprioritizing tasks — but several councilmembers said they had little appetite for risking compliance or service disruption.

After lengthy discussion and multiple unsuccessful motions to extend the meeting, the council left without adopting a final FY26 budget or reaching consensus on which of the staff alternatives to pursue next. Staff told council it will return with more detailed cost estimates and options for balancing rates, transfers and reserves before the next meeting.