Covington city finance staff presented a multi‑year 2026 budget forecast on Oct. 28 and the City Council directed staff to prepare property‑tax ordinances reflecting a 1% levy increase (plus new construction) for consideration at the council’s Nov. 12 public hearing.

The forecast, delivered by Casey (finance staff), shows an estimated general fund ending balance of about $20.15 million for 2026 but projects that the city will draw down reserves and enter a negative unassigned fund balance by 2031 if current decision cards and ongoing expenditures are maintained. "So that's kinda what the general fund looks like with those additional adds," Casey said while summarizing the longer‑range outlook.

City staff walked council through revenue assumptions — sales taxes held flat for 2025–26 with a 4% inflator in later years, property taxes modeled as the 1% increase plus new construction, and a conservative approach to a new RBNO line projected at $2 million for 2025. Staff also reviewed reserve designations including the aquatic and debt service reserves, HB 1590 and HB 1406 allocations, and a Jenkins Creek Trail transfer that was approved earlier but not expended until 2026.

Council members questioned personnel cost assumptions. Casey said the salary projection reflects a 2.715% COLA included for 2026 plus step increases from a recent salary study, producing higher personnel growth in early years and tapering later. Council member Jennifer expressed concern about the roughly 50% wage growth shown across six years and asked whether the projections could be adjusted. Casey replied that options exist — for example, reducing the COLA or freezing steps — but that changes would require policy direction.

Staff and council also discussed public safety staffing and overtime. Reagan (staff) summarized department projections, saying hiring a new officer "would save us between 50 and $60,000 per year on overtime expenses" by eliminating roughly 530 hours of overtime across covered shifts. Council and staff noted uncertainty in reconciliation payments from the county and the interlocal lead time for adding a sheriff‑provided officer, discussed as approximately nine months.

The forecast included a proposal to fund a full‑time public works project manager by combining a half‑time SWIM‑funded position with a half paid from the street fund. Casey outlined a scenario that would reduce the transfer to the pavement preservation program by roughly the position cost (about $95,000 annually) while retaining a $500,000 pavement preservation project budget for 2026; Don (public works) said a full FTE is important to stretch pavement dollars and manage project selection and timing.

Following a public hearing on the city’s revenue sources and the possible property‑tax increase, the council indicated support for preparing ordinances based on a 1% levy increase (plus new construction) and asked staff to return with the formal ordinance and additional detail at the Nov. 12 meeting so final decisions can be made in December. Casey said the property‑tax calculation in the forecast yields an estimated levy rate of roughly $0.69 per $1,000 of assessed value; for the example home used in the presentation (assessed at about $845,650), the projected annual city property tax would increase from about $604 to $607 under the assumptions used.

The forecast incorporated decision cards reviewed at the budget workshop, including a one‑time community care coordinator funded from HB 1590/opioid funds, a modest increase to human services funding, and funding requests for parks and aquatic facility maintenance. Staff emphasized that while the city meets its 20% fund balance target now, maintaining recent additions without offsetting revenue or reductions will consume reserves over the next decade.

Council members asked staff to provide additional scenarios (for example, reduced COLA or alternative uses of reconciliation and B&O revenue) before Nov. 12. Casey agreed to distribute the updated forecast and to prepare the property‑tax ordinance reflecting the council direction.

Evidence: Casey presented the full forecast and reserve breakout and answered council questions during a 90‑minute discussion; council formally opened and closed the revenue public hearing and directed staff to prepare ordinances at the meeting's close.

Ending: Council left the proposed budget items on the table for further deliberation at the Nov. 12 public hearing and asked staff to return with the formal property‑tax ordinance and additional funding scenarios.