Edmond staff lay out conservative general fund, internal service budgets; hiring freeze proposed

At a special budget workshop, city finance staff reviewed the proposed fiscal-year 2025–26 general fund and internal service fund budgets and described conservative revenue assumptions, a hiring freeze for non‑utility and non‑public‑safety positions and the city’s current reserve position.

Kathy Panas, presenting the general fund and internal services overview, said staff budgeted 0% growth in sales tax for the coming year and 4% growth for use tax, reflecting a cautious approach amid recent declines in sales tax receipts. “We budgeted 0% growth in sales tax for next year,” Panas said. She reported that sales tax receipts were down about 0.69% year to date while use tax was up compared with last year.

The presentation showed the general fund’s total incoming resources at about $104.6 million, including about $81.4 million in new revenue and roughly $22.8 million in interdepartmental transfers. Panas said interdepartmental numbers include required transfers tied to the city’s bond indenture and that those transfers can appear both as revenue and an expense on different schedules. She said one-time capital outlay was budgeted at $800,000, largely for street repairs funded by gas and commercial vehicle taxes.

Panas highlighted personnel and operating allocations within the general fund. The general fund operating budget includes personnel, materials and supplies and professional services; other services and charges — a line that includes outside legal and consulting fees — totaled several million dollars in the proposal. She told council that the city allowed normal step increases in the proposed budget but is implementing a hiring freeze expected to save about $1 million.

On reserves, Panas said the general fund balance is about $6.3 million, or 7.35% of the metric used in the city’s policy. The council’s 10% fund-balance policy is a stated goal, not a statutory requirement; Panas said the city would need about $2.3 million more to reach the 10% target. “Personally right now, I think especially in our economic times right now, I’m feeling comfortable with 7.35%,” she said, while noting the purpose of the reserve is to cover unexpected emergencies.

The internal service funds — the city’s overhead funds that cover insurance, fleet maintenance, information technology and other centralized services — were shown with approximately $87.5 million in resources and uses. Panas described those funds as driven by allocations: departments are charged for their share of centralized services so reserves are available for large equipment replacements or claims. She said some internal service capital spending in FY25 (for example, replacement vehicles and a fire truck) reduced planned capital needs in FY26.

City staff also provided a high-level debt summary. Panas said governmental debt has declined due to principal payments, while business‑type debt (water and electric infrastructure) had increased because of recent water projects and draws on Oklahoma Water Resources Board loans. She noted the commonly reported $1.2 billion figure in public materials included interest and earlier projections; principal-only figures are lower.

Mayor Davis and multiple council members praised staff for the level of detail and recommended continuing the conservative assumptions. Staff reminded the council that the formal budget hearing is scheduled for May 12 at 2 p.m., a follow-up workshop is set for May 27, and adoption is scheduled for the June 9 regular meeting.

The council adjourned the workshop by voice vote at the close of the session.