Study Session Memo

City of Boulder City Council Study Session Summary Meeting Date: October 9, 2025

Agenda Title Consideration of a motion to accept the September 11, 2025, Study Session Summary regarding the 2026 Recommended Budget for City of Boulder.

Staff Contact •

Charlotte Huskey, Budget Officer

Draft Motion Language Staff requests council consideration of this matter and action in the form of the following motion: Motion to accept the September 11, 2025, Study Session Summary regarding the 2026 Recommended Budget for the City of Boulder.

Presentation Summary The purpose of the study session was to present the City Manager’s 2026 Recommended Budget, and to give City Council an opportunity to ask questions and provide comments. Staff presented financial considerations and assumptions for the 2026 fiscal year including major revenue changes, the 2026 Recommended Budget overview, and future financial planning. Staff then asked council for its questions and comments. The study session began with a presentation provided by the Budget Office, Finance Department staff. Staff presented on the key considerations and assumptions used in the creation of the City Manager’s 2026 Recommended Budget. Staff reviewed the decline of city revenues, including a 0.3% decline in Sales and Use Taxes and a

slowing growth of 3.1% in Property Taxes, and the current economic conditions including the uncertainty of federal funds. Staff emphasized that if left unaddressed, the General Fund would see a $7.5 million shortfall in 2026, with a growing gap in outyears. The 2026 Recommended Budget focuses on addressing this shortfall through strategic reductions while continuing to prioritize core services and maintain flexibility. The Finance Department worked alongside all other departments to identify strategic budget options, including reductions and realignments, and bring forward to council a balanced budget that uplifts city priorities and demonstrates organizational resiliency. The 2026 Recommended Budget consists of a $407.7 million Operating Budget and a $113.3 million Capital Budget. Significant budget changes include a proposed 11.6% decrease overall across all funds, a proposed 7.8% decrease to the General Fund, and a modest increase of 2.1% to the Operating Budget, the lowest rate of growth since 2021. The 2026 Recommended Budget was created using the Budgeting for Resilience and Equity Framework and advances several strategies and priority actions within the Citywide Strategic Plan and proposes changes to budget as aligned with the Sustainability, Equity, and Resilience Framework. Within the 2026 Recommended Budget online budget book, the Budget in Brief and Budget Highlights provide a comprehensive summary of the significant change including fiscal spending plans across all funds, departments, and programs areas in the city’s budget. The Transparency Portal, linked within the Budget Book, provides users the ability to look at the details of the 2026 Recommended Budget and compare to the 2025 and 2024 Approved Budgets. Finally, staff presented the continued work of the Long-Term Financial Strategy, a 2024 top City Council priority that aims to support revenue stability and sufficiency by rebalancing revenue structures, researching and implementing alternative funding mechanisms, among other workplans. This work is reflected in the 2026 Recommended Budget through the realignment of funds to uplift priorities, examination of the flexibility of funds, the introduction of alternative funding mechanisms, and the creation of the Comprehensive Fee Inventory which is now included in the 2026 Budget Book and will be updated annually.

Questions for Council and Direction Received Council was asked two questions: What questions do council members have on the 2026 Recommended Budget and next steps? Do council members recommend any substantive changes in advance of its first reading consideration of the 2026 Budget on October 9, 2025? For the first question to council, “what questions do council members have on the 2026 Recommended Budget and next steps,” some themes council members shared focused on budgeting strategies and alignment to the Sustainability, Equity, and Resilience (SER) Framework.

Council asked staff how the budgeting recommendations were made and what impacts proposed reductions would have. Staff answered that the Budgeting for Resilience and Equity (BRE) outcomes and metrics framework was utilized to inform strategic budget choices, such as the restructuring of the Community Assistance Response and Engagement (CARE) and Safe and Managed Public Spaces (SAMPS) programs and strategic realignment of budgets for vacant positions. Part of the continued work of BRE is understanding alignment of resources and how they align to the seven SRE goal areas and intended outcomes. This is something staff continue to refine year after year, recognizing that if shifts are needed then realignments between programs are revisited. Department leaders and program managers worked closely with finance staff to make strategic decisions. Other questions were related to the additional proposed revenues and fees. Some questions were about the proposed raised fees for parking, and the introduction of new fees such as the Transportation Maintenance Fee and the Single-Family Housing Impact Fee (to be discussed specifically at the October 9 and October 16 council meetings respectively). Staff provided information on how the updating of fees and introduction of alternative funding mechanisms are a component of the Long-Term Financial Strategy, as well as upcoming ballot measure strategies. Staff also provided information on the engagement process for the Transportation Maintenance Fee including conversations facilitated in partnership with the Boulder Chamber of Commerce and the University of Boulder. Staff answered questions about the consolidation of office buildings to support the funding of the construction of Western City Campus, as well as the debt obligation policy and the upcoming payment of several current obligations. Staff also answered questions about the cost-allocation model and provided information on how it was created using industry best practices and spoke about the restricted nature of some of the revenues the city receives. Finally, city staff answered questions about specific programs impacted by the 2026 Recommended Budget. Staff answered that the Elevate Boulder pilot program is, at this time, coming to an end as it was supported by one-time ARPA grant funds, and that the city would support the program’s next cohort if matched first by the private sector. Staff discussed how the realignment of money from the Eviction Prevention and Rental Assistance (EPRAS) Fund to the Building HOME program will not have an impact on the current operations of EPRAS. Staff shared proposed plans for the money generated from the sale of the Broncos, the competitive and noncompetitive grant process managed by Housing and Human Services, and staff informed council that the new Constituent Relationship Management system is scheduled to begin at the opening of the Western City Campus, and finally, staff provided details on the Safe and Managed Spaces program and spoke to how there will not be substantial programmatic changes despite the realignment of funds.

For the second question asked of council, “do council members recommend any substantive changes in advance of its first reading consideration of the 2026 Budget on October 9, 2025,” several council members shared that at this time, they have no recommended changes but may have recommendations prior to the staff-recommended October 6 deadline for council budget amendments. Other council members shared concerns about how the proposed fees will impact local businesses, and, look to consider potential recommendations for affordable housing as well as supporting the social safety net.

Next Steps for City Council Council members were asked to share any potential recommendations or questions with staff by October 6. The first reading of the 2026 Recommended Budget will occur at the October 9 council meeting, and the second reading will occur on October 23.

Digital Accessibility The City of Boulder is committed to digital accessibility. Some content may not be fully accessible due to technical limitations or issues. For alternate formats or accommodations, please visit Accessibility | City of Boulder or contact accessibility@bouldercolorado.gov.

Attachments N/A