Total expenditures are $22,465,954 in the preliminary budget and pre-appropriation spending is only $19,601,931. The city will allocate approximately $2.8 million in fund balance to close the gap in the spending plan, according to preliminary budget documents.

The council voted 5-2 on Oct. 22 to keep the tax rate level. Councilwoman Marcia Weiss, D-1st Ward, who serves on the council’s finance committee, was one of two dissenting votes.

In voicing his opposition, Weiss expressed concern about such deep use of the city’s surplus.

“Several years ago we had an emergency that arose with a break in a sewer pipe that cost us a couple of million dollars. “You never know when something is going to happen,” he said.

Real estate taxes account for 34% of the city’s revenue and sales taxes account for 21%. The city has not increased the tax rate ($19.45 per $1,000 of assessed value) since 2011. After this year’s drop in the fund balance, $2.4 million remains, opening the possibility of a tax increase in the 2026 spending plan.

“It depends on what happens in 2025,” Weiss said. “Hopefully, some of these things that the (Downtown Revitalization Initiative) program is working on will get underway; Hopefully the sales tax will go up, but if not, I don’t see any way around it.”

“This is my personal opinion,” Weiss said. “When we are left with a fund balance of only $2 million, we are entering what I consider to be scary territory.”

The city’s largest expense categories are staff and employee benefits, totaling $8,706,631 and $6,968,243, respectively. Personnel costs increased compared to the previous year by $290,897 and employee benefits by $276,183.

“The cost of benefits for everyone is getting higher and higher, especially insurance,” Weiss said.

Contracts for various services and expenses also account for a large portion of city spending, amounting to $5,199,758 in the proposed 2025 plan, a decrease of $1,292,396 from the adopted 2024 budget.

In the 2025 proposal, the city dramatically increased the amount of money earmarked for debt service, with $705,773 going toward the principal balance, an increase of $186,773 from last year. Additionally, the city is more than doubling the amount it will pay in interest on the debt, with $738,449 earmarked for it, up from $276,071 in 2024.

“What’s happening is we’ve pooled more money together for what’s coming,” Weiss said. “The police building needs a lot of work, the fire building needs a lot of work and that increases debt service.”

A public hearing on the proposed budget will be held at the Nov. 12 council meeting and then a final vote on the spending plan will be held at the next council meeting on Nov. 26. Council meetings are at 6 pm at City Hall, located at 3 Frontage Road.

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