Finance Committee Agenda and Packet 2025 08 21

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SUBJECT: 2026 BUDGET UPDATE / RETREAT RECAP DATE: AUGUST 21, 2025 BACKGROUND: PAGE2OF3 At the July 23rd Budget Retreat, City Council deliberated and provided feedback and direction to Staff. This is summarized as follows; Structurally Balancing the General Fund In regard to Structurally Balancing the General Fund, the Council supported the recommended pathway to achieve structural balance in 2026, those were; • Reduced the abatement line item to align with historical trends • Shift computer replacement cost allocations from the general fund to the capital fund • Eliminate vacant Risk Management Specialist position, with duties to be spread and absorbed by existing positions in CMO and HR Departments. • Incorporated latest/revised Health Care Insurance projected rate increases into our Salary Projection Modeling. (From 10% estimated increase to 5% estimate increase) • Council requested additional information on any potential adjustments or modifications to the Wind Hail Deductible Buy Down. Council also directed Staff to work on the following Other Items for Consideration in advance of the 2027- 2028 Biennial Budget development. • Core Services and Service Level Alignments • Fee Review and Cost Recovery • Continue to review Cost Allocations • Review Cell tower leases at City facilities Structurally Balancing the Park Fund In regard to Structurally Balancing the Park Fund, Council supported the recommended pathway to achieve structural balance in 2026, those were; • Conservation Trust Fund transfer for operations in the amount of $100,000 annually in the near term as a stopgap measure. • Directed Staff to evaluate inflationary factor / CPI Transfer Methodology (City Financial Policy 2.3) for the Parks Fund. The Council also directed staff to monitor Sales Tax and Property Tax closely, providing updates as they relate to potential impacts and modifications to the presented budget. FINANCE COMMITTEE COMMUNICATION 15/106