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HomeMy WebLinkAboutResolution No. 2026-03Sponsored by: Administration CITY OF KENAI RESOLUTION NO. 2026-03 A RESOLUTION ADOPTING GOALS TO GUIDE THE PREPARATION OF THE FISCAL YEAR 2027 ANNUAL BUDGET. WHEREAS, at the Fiscal Year 2027 Budgetary Goals Work Session on January 7, 2026 the Council discussed and accepted public comment on goals and objectives to guide the City's fiscal year 2027 budget development; and, WHEREAS, the adoption of budget goals helps to ensure the budget is prepared in a manner which meets the needs and desires of the community and is consistent with the desires of the Council; and, WHEREAS, the Council has discussed and collectively adopted the Broad Statement of Purpose and Goals for the preparation of the Fiscal Year 2027 City of Kenai Budget as provided below; and, WHEREAS, the City Manager will utilize the adopted Broad Statement of Purpose and Goals to guide the creation of the City's Draft Budget which will be submitted to the Council for consideration and adoption. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA: Section 1. The Council adopts the following Fiscal Year 2026 Budget Goals and Broad Statement of Purpose: Broad Statement of Purpose The goal of the City is to prepare and adopt a fiscally responsible budget that meets the needs and priorities of the community it serves. A fiscally responsible budget ensures revenues, taxes, and fees are sufficient but not excessive to fund current operations and contribute to the long-term maintenance of City infrastructure used to provide services. Meeting the needs and priorities of the community means prioritizing essential services while being mindful that non -essential services such as parks, recreation, arts, library, and senior services have significant importance in creating a vibrant, well-balanced community in which individuals desire to live and businesses seek to locate. Council's adoption of these goals is intended to guide the Administration through its preparation of the City's FY2027 Annual Budget. Specific Goals 1. Prepare a budget for consideration that meets the City's operational and long-term financial obligations. The proposed budget should prioritize sustainability and consider adjusting the City's current mill and sales tax rates only if necessary to ensure fiscal stability and compliance with the General Fund, Fund Balance Policy codified in KMC 7.25. 2. Complete a review of the City's salary schedule and pay plan to ensure compensation remains competitive with comparable public employers. The plan should support the City's ability to recruit and retain qualified employees while protecting essential services and infrastructure. Incorporate a salary increase not to exceed inflation, as measured by the 2025 Alaska Consumer Price Index, second half over second half, if necessary to maintain competitive compensation with other public employers. New Text Underlined; [DELETED TEXT BRACKETED] Resolution No. 2026-03 Page 2of3 3. Review the City's health, dental, and life insurance benefits to ensure long-term sustainability while maintaining the current level and quality of coverage. Benefits should remain comparable to those offered by other public employers, and employee cost -sharing should likewise be comparable. If analysis indicates an increase in the employee cost share is warranted, limit the increase to no more than 1% of the premium costs 4. Identify opportunities for cost savings and operational efficiencies, while maintaining service quality and effectiveness. Budget development shall be conducted through a transparent process that incorporates performance measures and a comprehensive review of past expenditures, future needs, and organizational priorities to support informed decision -making and responsible resource allocation. 5. Compile a list of capital projects, which are projects that cost $35,000 or more, for Council consideration and adoption to ensure that the minimum investment in maintaining City infrastructure over time equals the depreciation, an accounting process by which the cost of an asset is spread over its useful life, recorded annually on City capital assets and infrastructure. The City's FY2025 depreciation by fund and function were: General Fund $19778,947 Airport Fund 213069604 Water & Sewer Fund 993,260 Total All Funds $50078,811 6. Adjust rates, charges, and fees across all funds in line with inflation, as measured by the Annual Alaska Consumer Price Index for All Urban Consumers. Any increase in the monthly rents at Vintage Pointe for existing tenants as of June 30, 2025, shall be capped at no more than $50.00 per month. 7. Utilize the results of the 2025 Community Survey to inform budget development by identifying areas of high resident satisfaction to be maintained and priority service areas where targeted investments or adjustments may be warranted. Budget recommendations should reflect community priorities related to City services, economic development, quality of life, and long-term community well-being, while remaining consistent with the City's fiscal policies and overall financial capacity. 8. Project ending fund balance/retained earnings of at least 50% of the FY2026 budgeted expenditures net of any projected lapse for the Airport, Water & Sewer, Personal Use Fishery, and Congregate Housing Funds. Ensure any use of fund balance is for one-time or capital purchases and not for recurring expenditures/expenses so that the ending fund balance for each fund is not less than: Airport Fund $1,864,079 Water & Sewer Fund 194721409 Personal Use Fishery Fund 2777698 Congregate Housing Fund 283,209 Section 2. That this Resolution takes effect immediately upon passage. New Text Underlined; [DELETED TEXT BRACKETED] Resolution No. 2026-03 Page 3of3 PASSED BY THE COUNCIL OF THE CITY OF KENAI, ATTEST: \ JA Miche e . S e , M C, City Clerk New Text Underlined; [DELETED TEXT BRACKETED] Q.,ity of i\enai (210 H algo Ave, Kenai, AK 99611-7794 1907.283.7535, www.kenai.city MEMORANDUM TO: Mayor Knackstedt and Council Members THROUGH: Terry Eubank, City Manager FROM: Dave Swarner, Finance Director DATE: January 21, 2026 SUBJECT: Resolution 2025-03 - Adopting Goals to Guide the Preparation of the Fiscal Year 2027 Annual Budget. Resolution 2026-03 will formally establish Council's goals for the City's FY2027 Budget. The adopted goals are intended to guide the City Manager in his preparation of the budget which is scheduled to be provided to Council in April for its consideration and adoption prior to the June 10th deadline established in KMC 7.25.010(g). The establishment of goals by the City Council early in the budget process is considered a best practice, one the administration believes should be incorporated into the City's budget process, as it provides guidance to the City Manager in his compilation of his draft budget and it provides greater transparency to the process. Council's establishment of specific, measurable, attainable, relevant and time based (SMART) goals will increase the likelihood of a smooth and successful budget process in FY2027 and future years. These goals were discussed and public testimony was heard at a work session held on January 7th You support for adoption is respectfully requested.