The City Council continues to work on the budget for 2026, including with a public hearing held before Monday’s meeting. P-J photo by Sara Holthouse

With the city council planning to pass the 2026 Budget during next week’s voting session, the council’s work on said budget continued Monday night with the required public hearing.

The 2026 city budget is currently looking at a 7.5% tax increase, which as of right now includes an appropriation of the fund balance of around $3.4 million, which is over half of what currently remains in the fund balance. The fund balance usage remains a large concern for council members and constituents, as said by the one constituent who came to the public hearing that was not a future council member, addressing both that and some other concerns, and discussing some potential ideas of what council can do in some areas.

Some other ideas to help with the budget were discussed by council, including a discussion about nonprofits, but the main conversation during the budget public hearing remained the fund balance.

Council President Tony Dolce said that during his many years of experience on city council he has seen the amount in the fund balance go up and down, including times when it is dangerously low as it is proposed to be now.

“I know that a few years ago it was at one of its highest points, mainly because of the use of the ARPA funds that we had and a few things that we didn’t need to budget for,” Dolce said.

An incoming Board of Public Utilities pilot payment and embellishment fees in other, bigger cities were discussed, and how if they were to try and do something like an embellishment fee there would be a lot of discussion and negotiation were then discussed. Returning to the fund balance, it was noted that it is recommended by the state for municipalities to have two months worth of funds left in the fund balance, which is about $7.4 million, at any given moment.

“What do we do then to get it back and build it back up?” Councilman Russell Bonfiglio, R-At Large, said. “We don’t want it to be that low, obviously, and I know you said it’s happened before. We should be concerned about it.”

Mayor Kim Ecklund clarified that it is very concerning for everyone, and it was asked what the replenishing plan would be for next year if this budget passes. Dolce emphasized that historically this has happened before and that the replenishing plan would be something decided on by the council moving forward.

“If you look at the history of the fund balance it has gone up and down from year to year with revenues, expenditures and so forth,” Dolce said.

It was noted that with the audit from the state when they see the fund balance the city will be talked to as far as a long term plan goes, and that they will understand but will not like it.

Property taxes were also mentioned, and are set to increase with this budget about $200 for the year.

Other budget items were brought up during the Mayor’s report at the work session later that night, including that the sales tax payment for the third quarter has been received.

“As you know when we released the budget there were a few uncertainties in it at the time we released it,” Ecklund said. “One was sales tax because if you recall from the first quarter and second quarter we missed a projected number and in the second quarter we were barely over, so we were concerned how things were going to flow through the year. Last week, we did receive our third quarter payment.”

The third quarter payment increase through last year’s year-over-year increase is 7.5%. It was put as 2% in the budget as a conservative approach, and after Ecklund and city comptroller Erika Thomas ran the numbers they are looking to increase the overall amount for sales tax in the budget to 6% for an increase over this year, adding another $3,000 to the budget.

Insurance adjustments and retirement amounts are also still being looked at, with information on that set to be in by mid-week to be on the agenda for next Monday’s voting session that the budget is set to be voted on at. Ecklund noted they are all favorable at this time.

Dolce reminded council that if they want to have adjustments on the floor to get them in before so they are not made on-the-fly the night of the vote. Amendments to the budget have to be made on the floor that night, but that way there will be no surprises and the council will know what is coming and have the numbers to back it up and make sure it is doable.

It was added that they want to get the budget approved next week to allow enough time to get everything set by Dec. 1.