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Consultants warn Amendment 3 could trigger deep shortfalls; $5M fire assessment shown as one mitigation
Summary
Raftelis consultants presented a 10-year model showing large revenue declines if Amendment 3 expands homestead exemptions, and offered mitigation options including pausing new personnel requests and a $5 million annual fire assessment estimated to cost an average homeowner about $172 per year.
Consultants working with the city presented a 10-year fiscal model that shows the city’s current budget is sustainable under the status quo but could face a “true financial emergency” if Amendment 3 — which would expand homestead exemptions — passes.
Mike Burton and Eric Vanmelson walked the commission through scenarios that simulate the amendment’s impact, including an initial homestead exemption of $150,000 in year one and $250,000 in year two and an annual inflation indexing thereafter. "Once tax reform passed, revenues will significantly decline between fiscal year 2028 and '29," Vanmelson said, summarizing the model's output.
The consultants tested immediate mitigation steps already in the proposed FY2027 budget: not implementing roughly $2.1 million in requested new personnel and reducing planned fire-market salary adjustments to the minimum required under the collective bargaining agreement, which together would save about $2.6 million in the first two years. Burton said those measures "close[] that gap between the total expenses and total revenues, by about $2,600,000 in the first 2 years."
For longer-term sustainability, the model showed a $5 million annual fire assessment as one viable option. Under that scenario, the presenter said the city could maintain reserves and approach a longer-term balanced outlook; the consultants estimated the assessment would add roughly $172 per year to the average single-family homeowner's bill, reducing the overall tax burden compared with the status-quo tax bill. "What a fire assessment is is a diversified revenue source that can fund a portion or all of your fire protection services," the consultant said.
The consultants stressed that the model is a planning tool, not a set policy: "It's all about choices and consequences," Burton said, and staff and commissioners indicated they will hold final decisions until after the November election and the outcome of Amendment 3.
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