HomeMy WebLinkAboutMemo - Mail Packet - 06/17/2025 - Memorandum from Caleb Weitz re June 5, 2025 Work Session Summary: 2025 Budget Update / 2026 Revision Process Preview
1
Work Session Memorandum
Date: June 10, 2025
To: Mayor and City Councilmembers
Through: Kelly DiMartino, City Manager
From: Caleb Weitz, Chief Financial Officer
Subject: June 5, 2025 Work Session Summary: 2025 Budget Update / 2026 Revision
Process Preview
Bottom Line
The purpose of this memo is to document the summary of discussions during the June 5, 2025
Work Session. All Councilmembers except for Tricia Canonico were present, with Susan
Gutowsky attending remotely.
Discussion Summary
The presentation started with an economic overview including national and state-level trends
and indicators. The level of economic uncertainty being experienced across the country is
having direct impact on the labor force, business investment and consumer buying behaviors.
Year to date revenue shortfalls, primarily with Sales Tax, were then covered. Although
combined Sales and Use Tax results look good on the surface, that is driven by significant one-
time revenue. Ongoing Sales Tax collections are under budget and are a financial concern the
City is working to address. This financial reality is being experienced by many cities along the
Front Range, especially in northern Colorado.
The conversation then shifted to the expense side of the ledger, where the greatest financial
challenges are being experienced with personnel costs. The City budgets those costs at less
than 100%, knowing there will always be vacancies in a non-hourly workforce of nearly 2,000
people. This allows for more resources to be directed toward service delivery to the community.
Staff turnover to date, however, is significantly less than anticipated, partially due to national,
state and local economic uncertainty. Although this is beneficial from a staffing perspective, it is
driving expense pressures that need to be managed.
Docusign Envelope ID: A05AC6AE-53D4-4C91-88DD-7E777D5B1A38
2
Next Steps
Staff is currently working to determine specific areas where budgets will be reduced in the 2nd
half of the year to address both the revenue and expense challenges the City is experiencing. A
summary of any community facing impacts will be communicated to Council later this year.
Actions to date include a hiring ‘pause’ to help address personnel costs, along with guidance for
departments to limit discretionary expenses, like conferences, travel, food and supplies.
At the same time, the organization is preparing for the 2026 Budget Revision process where
changes will be proposed to Council for year two of the adopted 2025-2026 Budget. The
governmental side of City operations (non-utilities) will have reductions in 2026. The 2026
Budget Revisions are scheduled to be discussed with City Councilmembers at the Council
Finance Committee (CFC) meeting on September 4. That will be followed by work sessions in
the fall, prior to adoption of the 2026 Annual Appropriation (spending authorization).
Follow -up Items
Downtown Fort Collins taxable sales follow up:
Tax District 21, which includes downtown Fort Collins, represents 10% of citywide taxable sales.
The “Restaurant, Caterers and Bars” category in Tax District 21 represents 24% of citywide
taxable sales in that category.
Docusign Envelope ID: A05AC6AE-53D4-4C91-88DD-7E777D5B1A38