Subject
title
Introduction and Possible Adoption of an Ordinance to amend Ordinance No. 12-25 to appropriate funds and levy taxes for FY 2026 (Budget Amendment #2)
end
Department
Finance
Recommendation
In accordance with the City Charter, since the budget ordinance is adopted at the fund level, a change in the appropriated amount of any fund requires action by the Mayor and Council. The vehicle for such action is an amendment to the budget ordinance. The proposed ordinance, Attachment 1, would amend the FY 2026 budget. The FY 2026 budget was adopted by the Mayor and Council on May 5, 2025, and amended on August 4, 2025.
If the Mayor and Council wish to proceed with adoption of the ordinance at the same meeting, the ordinance should first be introduced and then a motion should be made to waive the layover period. If the motion to waive the layover period is approved by an affirmative vote of six or more members of the Mayor and Council, a motion to adopt the ordinance may then proceed.
Discussion
The proposed ordinance, Attachment 1, would amend the FY 2026 budget. This amendment recognizes the items that are described in this agenda report and detailed on Attachment 2. The 4Q FY 2025 Financial Report is included as Attachment 3.
Purchase Orders that Carried Over from FY 2025
Each year the city re-appropriates funds to cover purchase orders that were outstanding at the close of the prior fiscal year. These purchase orders were issued before the end of the fiscal year, but the goods or services were not delivered until after the beginning of the new fiscal year. At year end, these funds are assigned for appropriation and are reflected as an adjustment to the next year's budget. A summary by fund of the FY 2025 purchase order amounts that carried over into FY 2026 is shown under the Fiscal Impact section of this agenda item. The total amount of purchase orders that carried over for all funds equals $5 million, but only $4.8 million shows as additional expenses due to the offset with the addition to reserves in the Sewer Fund (see footnotes in TABLE 1).
Operating Budget:
• Police Community Support ($200,000 increase in General Fund revenues and expenditures): Individuals or organizations in the community hire off-duty officers for a visible, uniformed, police presence and/or traffic control at planned events. The recently opened Wegmans is regularly utilizing this service, resulting in expected revenues and related overtime expenditures that will exceed the $30,000 included in the adopted budget, requiring an equal adjustment to both community support revenue and overtime expenditures.
• Replenish Grant Contingency ($20,000 increase in General Fund revenues and expenditures): The city receives new grants and changes to budgeted grants throughout the year. When these grants or changes are small, they can be added to the budget through grant contingency after receiving Mayor and Council approval, rather than having to wait on the next planned budget amendment. This amendment increases grant contingency by $20,000 to address several smaller pending grants that would exceed current grant contingency capacity if approved.
• Maryland Energy Administration Medium-Duty and Heavy-Duty Zero-Emission Vehicle Grant ($80,000 increase in General Fund revenues and $120,890 increase in expenditures): The adopted FY 2026 budget includes $239,700 for the purchase of one electric senior transit bus. Current pricing for a bus meeting all requirements for senior transit is $360,590, requiring an increase of $120,890. The city received a Maryland Energy Administration Medium-Duty and Heavy-Duty Zero-Emission Vehicle Grant, which provides $80,000 of the additional funds needed.
• David Scull Park Public Art Project ($105,000 increase Special Activities Fund expenditures): Additional funding, available from Art in Public Architecture (AIPA) reserves, is needed to allow sufficient funding capacity for proper project engineering for the upcoming planned public art project at David Scull Park.
• Replenish Water Fund Contingency ($65,000 increase in Water Fund expenses): Water Fund contingency was depleted during the first quarter mainly due to addressing a backlog of necessary water meter replacements. Replenishing the contingency account to the level included in the adopted budget will allow staff to address emergencies in a timely manner, should they arise before the next planned budget amendment.
Capital Improvements Program (CIP) Budget:
• Twinbrook Pedestrian and Bicycle Bridge (TC22, $284,000 decrease in Capital Projects Fund revenues and expenditures): As part the One Big Beautiful Bill Act the U.S. DOT has rescinded $284,000 for Phase 2 of the city’s Neighborhood Access and Equity (NAE) grant for the Twinbrook Pedestrian and Bicycle Bridge project. Phase 2 included the 30 percent design for the preferred crossing option. Phase 1 funding remains intact, and the city will conduct a feasibility study of the crossing locations, complete a cost-benefit analysis, and continue public engagement efforts. The net effect of this recission is that the city will need to find other funds for design and construction of the preferred option, after Phase 1 is complete.
Impact Statements
Equity
This amendment includes an increase in funding for public art in David Scull Park, which is located in a historically underserved community.
Environment
This amendment includes funding to replace a gasoline-powered bus with a zero-emissions transit bus for the city’s Senior Center, lessening negative environmental impacts.
Economy
This amendment includes an increase in estimated Police community support revenues and expenditures related to providing uniformed off-duty officers to local businesses. This service enhances security for the local businesses as well as customers, supporting the local economy.
Mayor and Council History
This is the second budget amendment for FY 2026. The FY 2026 budget was adopted by the Mayor and Council on May 5, 2025, and amended on August 4, 2025.
Fiscal Impact
The following operating fund(s) will be adjusted if this budget amendment is adopted.
TABLE 1
|
Operating Fund |
Amended Budget |
FY25 Purchase Orders |
11/10/2025 Amendment |
Amended Budget |
|
General Fund |
$119,933,686 |
$2,261,600 |
$300,000 |
$122,495,286 |
|
Water Fund |
$16,422,940 |
$897,852 |
$65,000 |
$17,385,792 |
|
Sewer Fund* |
$15,982,230 |
$ - |
$ - |
$15,982,230 |
|
Refuse Fund |
$8,759,240 |
$989,207 |
$ - |
$9,748,447 |
|
Parking Fund |
$2,926,520 |
$ - |
$ - |
$2,926,520 |
|
Stormwater Mgt. Fund |
$7,625,700 |
$356,191 |
$ - |
$7,981,891 |
|
Special Act. Fund |
$2,727,500 |
$58,249 |
$105,000 |
$2,890,749 |
|
CDBG Fund** |
$338,000 |
$188,000 |
$ - |
$526,000 |
|
Speed Camera Fund |
$1,380,080 |
$ - |
$ - |
$1,380,080 |
|
Debt Service Fund |
$3,342,000 |
$ - |
$ - |
$3,342,000 |
|
Total |
$179,437,896 |
$4,751,099 |
$470,000 |
$184,658,995 |
* FY 2025 purchase orders were added to the FY 2026 budget totaling $231,172 for the Sewer Fund, but this full amount was offset by a reduction in the fund’s “add. to reserves” line.
**CDBG purchase orders are funded by CDBG grant revenue.
The following Capital Improvements Program (CIP) fund(s) will be adjusted if this budget amendment is adopted:
TABLE 2
|
CIP Fund |
Amended Budget |
11/10/2025 Amendment |
Amended Budget |
|
Capital Projects Fund |
$55,561,325 |
($284,000) |
$55,277,325 |
|
Water Fund |
$29,428,055 |
$ - |
$29,428,055 |
|
Sewer Fund |
$15,249,173 |
$ - |
$15,249,173 |
|
Refuse Fund |
$719,618 |
$ - |
$719,618 |
|
Stormwater Mgt Fund |
$19,619,853 |
$ - |
$19,619,853 |
|
Special Activities Fund |
$1,370,286 |
$ - |
$1,370,286 |
|
Speed Camera Fund |
$ - |
$ - |
$ - |
|
Total |
$121,948,310 |
($284,000) |
$121,664,310 |