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Council debates formal sales-tax reserve; motion directs staff to budget a 25% cap for FY27
Summary
After a lengthy discussion about preserving discretionary sales-tax revenue for capital projects, council moved to direct staff to place sales-tax revenue into the capital projects fund — a floor of $200,000 with a path to up to 25% of receipts — for the FY27 budget and longer-term policy work.
Council members spent much of the retreat debating a formal policy for saving unexpected sales-tax receipts rather than re‑allocating them into ongoing operations. One councilmember argued for a formulaic approach: “I would propose… that we start at $200,000 flat up to 25% of sales tax return,” saying a predictable reserve would protect the city against downturns and help pre-fund major capital projects.
Staff said the administration already set aside $200,000 in some years and temporarily increased that figure in the previous fiscal year; staff also noted there is a gradual 3% annual escalator built into the current 10‑year capital plan. Council directed staff to include a FY27 proposal to move up to $250,000 of sales-tax receipts (capped at 25% of receipts) into the capital projects fund for drafting into the budget and return with a formal budget-policy document and multi-year priority list for council review.
