Simplified: Planning for next year’s budget is already underway, and based on early projections, the city is going to be looking at another year of belt-tightening. Here what to watch.
Why it matters
- Last year, the common refrain during budget season was “recalibration,” in response to state law (expected to go into effect in 2027) limiting how much money local governments can collect via property taxes. In anticipation of those changes, the city trimmed about $6 million in expenses for 2026.
- That work is expected to continue as the 2027 budget comes together. Finance Director Shawn Pritchett told councilors Tuesday he’s estimating another $4 million in cuts to ongoing expenses will be needed.
- That’s all happening at the same time as the city is seeing sales tax revenue come in lower than projections — which has happened the last three years in a row. That could mean another $1.5 million shortfall this year unless the council decided to temper expectations in the already-approved 2026 budget.
“I think its important for the public to understand sales tax is the single largest revenue source for the city," Pritchett said.
What about property taxes?
It's not as big of a piece of the pie as sales tax, but Pritchett said property taxes bring the city about $100 million in revenue each year.
- For context, that's also about what the city spends on public safety each year.
Megan Raposa
As a result of legislation passed last year, the city is estimating they'll need to reduce spending by $10 million over three years (including this year) to, as Mayor Paul TenHaken has repeatedly stated it, "recalibrate."
Tell me more about the budget process
If it feels like the city just went through a budget process, it’s because it did.
This year’s budget was approved formally in September, after several months of council work sessions and public meetings.
But the behind-the-scenes work on the budget is basically a year-round process, and Pritchett told councilors if they have stuff they want to see the city invest in in 2027, now’s the time to bring it up.
How does the budget work?
Here's a helpful resource:
Megan Raposa
What happens next?
The budget work is mostly behind-the-scenes until the mayor's annual budget address in July.
- Another twist in the 2027 budget process is the June mayoral and city council election.
- Because that election is in June, and the budget address is in July, whoever is elected as the new mayor will have only a few weeks to work on the budget before presenting it publicly.
It also means that the (up to) four new city councilors will also have to get up-to-speed really quickly because budget hearings will likely start up in August.
