City staff presented the proposed 2026 budget at a public budget workshop, outlining a general-fund revenue figure of $10,822,043 — an increase of about 3.14% over the 2025 budget — and a total of levied funds and expenditures of roughly $14.3 million.

The budget packet shows the city continuing to reduce reliance on property taxes: property taxes account for roughly 52% of general-fund revenues in the proposed 2026 budget, down from 65% in 2023 and 57% in 2025. The city’s presenter said, “we're looking at 10,822,000, and $43 in general revenues, which is an increase of about 3.14% over the 2025 budget,” and described other revenue sources that include interest income, charges for services (for example the school district’s payments for school resource officers), licenses and permits, and intergovernmental revenue from the state.

Despite higher operating expenses and an increase in some program costs — including an estimated $273,000 rise in debt service payments — the levy shown in the 2026 proposal decreases overall. Staff attributed the lower levy to several technical factors: a small amount of net new construction (0.67%) that produced about $40,000 of additional levy capacity citywide, the scheduled closure of TID 8 (which reduces the taxable value inside active TIDs), and the transfer of the city’s curbside garbage and recycling cost from the levy to a special charge on property tax bills. The presenter noted the combined effect produces a projected levy reduction of about $366,000 (roughly 3.77%) compared with 2025.

City staff cautioned that final mill rates cannot be calculated until the state issues the aggregate assessed value in October. Using the city’s assumptions, staff presented illustrative scenarios: if aggregate assessed value increases 2% year over year, the city's portion of the property tax bill could show a roughly 5.7% decrease; if assessed value is flat, the example table showed a potential 3.8% decrease. The presenter emphasized these are estimates that depend on the state-certified values.

Capital and borrowing plans. The proposed 2026 capital-improvement requests total just over $3.0 million, with $264,400 from levied funds and roughly $1.5 million identified as potential 2026 borrowing in the general fund column. In addition, staff said the city will refinance a $3.5 million note anticipation note tied to Ridgeview Estates/Banker Road infrastructure; that refinancing is expected to be repaid through TID 9 over the life of the district rather than the general levy. If combined, the refinancing and planned 2026 borrowing would total roughly $6.9 million, though staff noted only $2.9 million of that would be repaid by the general fund levy column in the materials presented.

Major project highlights in the CIP include strategic planning; continued work on Ridgeview Estates and Banker Road relocation design; South Main Street pedestrian path and related roadway improvements (a TAP grant has been used for design); airport master planning and small airport improvements; aquatic center and senior-center facility work; and replacement or upgrades of vehicles and equipment for public-safety and public-works fleets. Staff also described a 20-year repayment plan for certain general-fund borrowing shown in CIP tables.

Debt and borrowing capacity. Staff and financial advisors will present more detail to council when the city sets borrowing parameters later in the fall. Materials shown at the workshop indicate the city's outstanding principal will remain well below the state statutory borrowing limit and below the council’s self-imposed policy thresholds under the scenarios presented. Staff said combining refinancing and new borrowing can yield efficiencies, and the council will set parameters before any sale.

Next steps. Staff said a public hearing on the proposed budget will be published and held as part of the regular council agenda in November, with final budget adoption targeted at the November council meeting. Staff repeatedly cautioned that mill-rate calculations and final levy impacts depend on the state-certified equalized values that the city does not yet have.

Ending note. The workshop included department-level presentations and follow-up discussion on items that feed into the budget, including utility rate work, CIP priorities, and staffing and equipment requests; those topics were described in department slides and discussed by department heads during the workshop.