HomeMy WebLinkAbout02232026 City Council Laydown Substitute Resolution 2026-022**SUBSTITUTE RESOLUTION**
City Council Agenda Statement
Meeting Date: February 23, 2026
To: City Council
Through: Kat Sorensen, City Manager
From: Sully Jusino, Finance Director
Subject: Resolution 2026-022: Amending the FY 2025-2026 Budget to Reflect Mid -
Cycle Budget Adjustments and Appropriating Funds
Background and justification:
The 2025 and 2026 Biannual Budget, which covers the period January 1, 2025 through December
31, 2026, was passed on December 16, 2024. Periodically, adjustments are made to the budget as
new revenue data and/or changing priorities and projects become available.
The specific budget adjustments requested are listed on the attached schedules, with major changes
described below.
The proposed mid -cycle budget amendments reflect updated revenue projections, operational
adjustments, and organizational changes within the General Fund and Enterprise Funds.
These amendments reflect updated information in the General Fund, such as sales tax revenues
trending higher than originally projected forming the basis for a revised FY2026 projection of
$8,328,618. Continued strength in tourism supports updated bed tax projections of $901,880 for
FY2026. Investment earnings have also exceeded original budget estimates due to sustained
interest rates and strong cash balances.
Departmental adjustments are proposed within the Police and Library Departments to align
compensation and operations following leadership transitions. Within Parks and Recreation,
personnel costs are being reallocated directly to operational divisions to improve cost transparency
and reporting. Funding is also proposed for the vacant and previously unfunded Teen Youth
Center (TYC) position to support growing program participation and avoid a PERS termination
study.
A decrease in General Fund administrative revenue reflects the transfer of $304,062 in expenses
to the Electric Department for FY2026. Enterprise Fund amendments in FY25 incorporate funding
for the Major Repair and Replacement Fund to support long-term capital infrastructure needs in
the Harbor, Water, and Wastewater Funds.
The intent of this resolution is to amend the FY25/26 budges as described in the narrative above,
plus appropriate funds as listed in the attachments.
Comprehensive and Strategic Plan Consistency Information
This legislation is consistent with (citation listed):
Comprehensive Plan:
Strategic Plan:
Other:
Total amount of funds listed in this legislation: $ Please see the attachments
Th s legislation (✓):
Creates revenue in the amount of: $
Creates expenditure in the amount of: $
Creates a savings in the amount of: $
Has no fiscal impact
Funds are (✓):
Budgeted Line item(s):
Not budgeted
Not applicable
Fund Balance Information
Affected Fund (✓):
General
Boat Harbor
Motor Pool
X
X
X
X
Available Fund Balance
SMIC
Parking
Other
X
Electric
Water
Wastewater
Healthcare
Note: amounts are unaudited
Finance Director Signature:
Lzit 2"-isit°
X
Yes
Attorney Signature:
Not applicable Comments:
Administration Recommendation
X
Adopt Resolution
Other:
Sponsored by: Sorensen
**SUBSTITUTE RESOLUTION**
CITY OF SEWARD, ALASKA
RESOLUTION 2026-022
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA,
AMENDING THE FY 2025-2026 BUDGET TO REFLECT MID -CYCLE BUDGET
ADJUSTMENTS AND APPROPRIATING FUNDS
WHEREAS, the FY 2025-2026 Operating Budget was passed on December 16, 2024, reflecting
the budget period from January 1, 2025 through December 31, 2026; and
WHEREAS, budget adjustments are made at various points during the year, and these additional
mid -cycle budget amendments reflect updated information in the General Fund, such as an
increase in revenue collections and updated economic analysis indicate that sales tax revenues are
trending higher than originally projected; and
WHEREAS, FY2025 revenues form the basis for a revised FY2026 projection of $8,328,618.
Continued strength in tourism and seasonal economic activity supports revised tax revenue
projections of $901,880 for FY26; and
WHEREAS, the City's investment portfolio has generated earnings above original budget
estimates due to sustained interest rates and stronger -than -anticipated cash balances, requiring
formal recognition through a mid -cycle budget amendment; and
WHEREAS, leadership transitions within the Police Department and Library Department,
including the appointment of new department heads, necessitate adjustments to salary and benefit
allocations and related operational line items to align with current staffing structures and
organizational vision; and
WHEREAS, the City has evaluated internal cost allocation practices within the Parks and
Recreation Department and determined that reallocating personnel costs directly to operational
divisions will improve financial transparency, cost tracking, and program -level accountability; and
WHEREAS, the City has reinstated the Teen Youth Center (TYC) and seen a growth in the
popularity and attendance and determine that it is in the best interest to fund the vacant TYC
position to enhance overall operations and avoid a costly PERS termination study; and
WHEREAS, a decrease in the Admin expense revenue for the General Fund is due to the transition
of expenses to the Electric Department in the amount of $304,062 for FY26; and
WHEREAS, these additional mid -cycle budget amendments reflect updated information in the
Enterprise Fund, such as adjustments made to incorporate funding for the Major Repair and
Replacement Fund, which is intended to replace capital assets on outgoing infrastructure projects
for the Harbor, Water, and Wastewater Funds.
CITY OF SEWARD, ALASKA
RESOLUTION 2026-022
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
SEWARD, ALASKA:
Section 1. Enterprise Fund 2025 reflects allocated revenue and expenses according to the
adjustments included on the attached Schedule B, as follows:
1) The Harbor Enterprise Fund revenue are increased by $267,145; the expenditures
increased by $267,145.
2) The SMIC Enterprise Fund revenue are increased by $126,914; the expenditures
increased by $126,914.
3) The Parking Enterprise Fund revenue are increased by $258,209
4) The Electric Enterprise Fund expenses are decreased by $304,062; revenue increased by
$224,269
5) The Water Enterprise Fund expenses are increased by $100,000; the revenue increased
by $100,000, and the Wastewater Enterprise Fund expenses are increased by $100,000;
and the revenue increased by $147,899.
Section 2. The General Fund 2026 Budget is hereby amended, and funds are hereby appropriated
according to the adjustments included on the attached Schedule A, as follows: 1) Revenues are
adjusted for a net increase of $1,033,683; 2) Various expenditures are adjusted for a net decrease
of ($1,033,683).
Section 3. This resolution shall take effect immediately upon its adoption.
APPROVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, ON THE
23rd DAY OF FEBRUARY 2026.
Sue McClure, Mayor
ATTEST:
CITY OF SEWARD, ALASKA
RESOLUTION 2026-XXX
Kris Peck
City Clerk
CITY OF SEWARD
BOAT HARBOR ENTERPRISE FUND
Budgeted Statement of Cash Flow
For Fiscal Year 2025 and 2026
2025
Budget
Beginning Cash Balance at I/1/25*: $ 5,72I,429
Cash is provided by (used for):
Operations
Add expense items not affecting cash
Depreciation and Motorpool Rent
Net cash provided by operations
Other sources (uses) of cash
Investments
Debt service:
Interest
Principal
Infrastructure
Transfers -out
Other
Net increase (decrease) in cash
Estimated ending cash balance:
2026
Budget
$ 4,656,293
$ (1,489,296) $ (2,028,896)
$ I,8I8,930
$ 329,634
$ I5,000
$
$
$
$
(29,600)
(400,000)
(I5I,820)
(847,788)
I9,438
$ (I,065,I36)
$ 4,656,293
Ties to December 3I, 2024 cash and investment balance per ACFR
$ I,8I8,570
$ (2I0,326)
$ I5,000
(4,800)
(320,000)
(663,953)
I0,000
$ (I,I74,079)
$ 3,482,214
CITY OF SEWARD
SMIC ENTERPRISE FUND
Budgeted Statement of Cash Flow
For Fiscal Year 2025 and 2026
2025 2026
Budget Budget
Beginning Cash Balance at I / I /25*: $ 637,112 $ 468,57I
Cash is provided by (used for):
Operations $ (I,508,529) $ (I,677,886)
Add expense items not affecting cash
Depreciation and Motorpool Rent $ I,535,000 $ 1,535,000
Net cash provided by operations $ 26,47I $ (I42,886)
Other sources (uses) of cash
Investments $ I,750 $ I,750
Transfers -out $ (196,762) $ (I49,095)
Net increase (decrease) in cash $ (I68,54I) $ (290,231)
Estimated ending cash balance: $ 468,57I $ I78,340
# Ties to December 3I, 2024 cash and investment balance per ACFR
CITY OF SEWARD
ELECTRIC ENTERPRISE FUND
Budgeted Statement of Cash Flow
For Fiscal Year 2025
2025
Budget
Beginning Cash Balance at I/I/25*: $ 6,847,5I9
Cash is provided by (used for):
Operations
Add expense items not affecting cash
Depreciation and Motorpool Rent
Net cash provided by operations
Other sources (uses) of cash
Investments
Debt service:
Interest
Principal
Infrastructure
Equipment
Transfers -out
Other
Net increase (decrease) in cash
Estimated ending cash balance:
470,27I
$ I,853,433
$ 2,323,704
$ 36,050
$ (56I,242)
$ (370,000)
$ (I,830,436)
$ (90I,397)
$ (I,3II,I46)
$ 27,604
$ (4,9I0,567)
$ I,936,952
* Ties to December 3I, 2024 cash and investment balance per ACFR
CITY OF SEWARD
PARKING ENTERPRISE FUND
Budgeted Statement of Cash Flow
For Fiscal Year 2025 and 2026
2025 2026
Budget Budget
Beginning Cash Balance at I/I/25*: $ I,282,695 $ I,502,898
Cash is provided by (used for):
Operations
205,172
206,869
Add expense items not affecting cash
Depreciation and Motorpool Rent $ 43,965 $ 33,965
Net cash provided by operations $ 249,137 $ 240,834
Other sources (uses) of cash
Investments $ 5,000 $ 5,000
Transfers -out $ (33,934) S (34,477)
Net increase (decrease) in cash $ 220,203 $ 211,357
Estimated ending cash balance: $ I,502,898 $ I,7I4,255
Ties to December 3I, 2024 cash and investment balance per ACFR
CITY OF SEWARD
WATER ENTERPRISE FUND
Budgeted Statement of Cash Flow
For Fiscal Year 2025 and 2026
2025 2026
Budget Budget
Beginning Cash Balance at I/I/25*: $ 4,000,90I $
Cash is provided by (used for):
Operations
Add expense items not affecting cash
Depreciation and Motorpool Rent
Net cash provided by operations
Other sources (uses) of cash
Investments
Debt service:
Interest
Principal
Transfers -out
Other
Net increase (decrease) in cash
Estimated ending cash balance:
$ 332,456 $
408,550
4,326,896
3I6,693
428,500
$ 74I,006 $ 745,I93
$
$
$
30,000
(6,85I)
(149,993)
(289, 167)
1,000
$ 325,995
$ 4,326,896
Ties to December 3I, 2024 cash and investment balance per ACFR
30,000
(4,602)
(152,243)
(191,794)
I,000
427,554
4,754,450
CITY OF SEWARD
WASTEWATER ENTERPRISE FUND
Budgeted Statement of Cash Flow
For Fiscal Year 2025 and 2026
Beginning Cash Balance at I / I /25*:
Cash is provided by (used for):
Operations
Add expense items not affecting cash
Depreciation and Motorpool Rent
Net cash provided by operations
Other sources (uses) of cash
Investments
Debt service:
Interest
Principal
Equipment
Transfers -out
Transfers -in
Net increase (decrease) in cash
Estimated ending cash balance:
2025
Budget
2026
Budget
$ 3,9I6,678 $
$ (329,96I) $
$ 343,550 S
3,55I,357
(46I,672)
363,550
$ I3,589 $ (98, I22)
20,000 $ 20,000
(I2,002) $ (I0,990)
(67,444) S (68,456)
(113,072) S
(232,392) $ (I34,II0)
26,000 $ 26,000
(365,32I) $ (265,678)
3,55I,357 $ 3,285,679
'k Ties to December 3I, 2024 cash and investment balance per ACFR
COS Changes to the Transfer Schedule for FY25 & FY26 2025
TRANSFERS FROM OTHER FUNDS:
Boat Harbor Enterprise Fund:
Transfers to contribution to the MRRF
Commercial Vessel Tax Fund:
For SVAC ambulance and Fire service to cruise ships,
Firefighter position funding, and for GF services to cruise
ships, police security, museum movie, etc.
Account
Transfers -
Out
11000-0000-3710-11001 $ 217,145
11103-0000-3710-01000 $ 140,000
* This change will also be for FY26, transfers will be out of F11103*
Seward Marine Industrial Center Enterprise Fund:
Transfers to contribution to the MRRF
Water Enterprise Fund:
Transfers to contribution to the MRRF
Wastewater Enterprise Fund:
Transfers to contribution to the MRRF
12000-0000-3710-11001 $ 50,000
17000-0000-3710-17001 $ 100,000
18000-0000-3710-18001 $ 100,000
TOTAL TRANSFERS OUT: $ 607,145
City of Seward - Enterprise Funds
2025 Proposed Mid -Cycle Budget Adjustments
Schedule "B"
ENTERPRISE FUND CHANGES
Harbor Fund
Revenue Increases (Decreases):
Amount Department Account Name Description
$
$
196,325 11000-2000-5901
20,820 11000-2000-5905
$
217,145 Estimated Revenue Increase
EF Investment Interest Increased rate of return
EF Penalties and Interest Increased rate of return
Expenditure Increases (Decreases):
Amount Department Account Name Description
$ - Estimated Expenditure Increase
$ 217,145 Estimated Net Impact
City of Seward - Enterprise Funds
2025 Proposed Mid -Cycle Budget Adjustments
Schedule "B"
ENTERPRISE FUND CHANGES
SMIC Fund
Revenue Increases (Decreases):
Amount Department Account Name Description
$
$
$
40,000 12000-2500-5000
30,000 12000-2500-5901
56,914 12000-2500-5104
$
126,914 Estimated Revenue Increase
Land Rents & Leases
EF Investment Interest
Storage Fees
Increase in Leases activity
Increased rate of return
Increased in activity
Expenditure Increases (Decreases):
Amount Department Account Name Description
$ (50,000) 12000-2504-8104 Motor Pool Rent Correction on Motorpool rent. Based on depreciation percentages.
$
(50,000) Estimated Expenditure Decrease
$ 176,914 Estimated Net Impact
City of Seward - Enterprise Funds
2025 Proposed Mid -Cycle Budget Adjustments
Schedule "B"
ENTERPRISE FUND CHANGES
Parking Fund
Revenue Increases (Decreases):
Amount Department Account Name Description
$ 58,536 13000-2900-5901 EF Investment Interest Increased rate of return
$ 40,000 13000-0000-5200 S. Harbor Lot Increaed due to increased activity and enforcement
$ (90,878) 13000-0000-5201 N. Harbor Lot Budget Adj. due to low activity.
$ 13,545 13000-0000-5207 Miscellaneous Parking Fees Increase due parking enforecement
$ 135,438 13000- 0000- 5212 Fines - Parking Tickets Increase due parking enforecement
$ 101,568 13000-0000-5202 N.E. Ramp Lot Increaed due to increased activity and enforcement
$ 258,209 Estimated Revenue Increase
Expenditure Increases (Decreases):
Amount Department Account Name Description
$ Estimated Expenditure Increase
258,209 Estimated Net Impact
City of Seward - Enterprise Funds
2025 Proposed Mid -Cycle Budget Adjustments
Schedule "B"
ENTERPRISE FUND CHANGES
Electric Fund
Revenue Increases (Decreases):
Amount Department Account Name Description
$ 203,520 15000-0000-5901
$ 20,749 15000-0000-5905
224,269 Estimated Revenue Increase
EF Investment Interest Increased rate of return
EF Penalties and Interest Increased rate of return
Expenditure Increases (Decreases):
Amount Department Account Name Description
$ (304,062) 15000-3000-7307 Admin. Exp. - Electric Decrease of the 28% decrease due a reduction form the GF Adm.Exp.
(304,062) Estimated Expenditure Decrease
(79,793) Estimated Net Impact
City of Seward - Enterprise Funds
2025 Proposed Mid -Cycle Budget Adjustments
Schedule "B"
ENTERPRISE FUND CHANGES
Water Fund
Revenue Increases (Decreases):
Amount Department Account Name Description
$ 145,144 17000-0000-5901 EF Investment Interest Increased rate of return
$ 6,709 17000-0000-5905 EF Penalties and Interest Increased rate of return
$
151,853 Estimated Revenue Increase
Expenditure Increases (Decreases):
Amount Department Account Name Description
$ - Estimated Expenditure Increase
$
151,853 Estimated Net Impact
City of Seward - Enterprise Funds
2025 Proposed Mid -Cycle Budget Adjustments
Schedule "B"
ENTERPRISE FUND CHANGES
Wastewater Fund
Revenue Increases (Decreases):
Amount Department Account Name Description
$ 146,667 18000-0000-5901 EF Investment Interest Increased rate of return
$ 1,232 18000-0000-5905 EF Penalties and Interest Increased rate of return
$
147,899 Estimated Revenue Increase
Expenditure Increases (Decreases):
Amount Department Account Name Description
$ - Estimated Expenditure Increase
$
147,899 Estimated Net Impact
GENERAL FUND:
REVENUE CHANGES:
Revenue Increases:
City of Seward - General Fund
2026 Proposed Mid -Cycle Budget Adjustments
Schedule "A"
Amount
Account Name
Account Number
Description
739,093 Tax Revenue - Sales
188,968 Tax Revenue - Real Property
52,139 Tax Revenue- Personal Property
20,000 Hotel/Motel Room Tax
22,545 Fines and Bails
450,000 GF Interest on Investments
10,000 GF Penalties & Interest
35,000 GF Misc Interest Revenue
20,000 Franchise Fee - Refuse
30,000 Building Permits
10,000 Puchasing Card Rebate Program Revenue
1,577,745 Estimated Revenue Increase
$ 1,577,745 Estimated Revenue Increases
$ (544,062) Estimated Revenue Decreases
$ 1,033,683 Estimated Net (Decrease) in Revenues
01000 0000 4000 0000 00000
01000 0000 4010 0000 00000
01000 0000 4011 0000 00000
01000 0000 4020 0000 00000
01000 0000 4400 0000 00000
01000 0000 4500 0000 00000
01000 0000 4501 0000 00000
01000 0000 4503 0000 00000
01000 0000 4620 0000 00000
01000 1250 4100 0000 00000
01000 0000 4634 0000 00000
Tax revenue growth is driven by
stronger economic activity
Tax revenue growth is driven by
stronger economic activity
Tax revenue growth is driven by
stronger economic activity
Increase in hotels/motels in the
area
Increase in law enforcement in
the area.
Better-than-expected
investments returns.
Better-than-expected
investments returns.
Better-than-expected
investments returns.
Growth in Commercial and
residential units.
Increase due to development in
the area.
New Rebate program from the
PCard
Revenue Decreases:
Amount
Account Name
Account Number
Description
(160,000) Payments in Lieu of Tax
(304,062) Admin. Exp. - Electric
(80,000) Gravel Sales
$ (544,062) Estimated Revenue Decrease
01000 0000 4030 0000 00000
01000 0000 4304 0000 00000
01000 0000 4611 0000 00000
Contract end in 2025
28% decrease due a reduction
form the GF Adm.Exp.
No sales revenue expected for
this year
City of Seward - General Fund
2026 Proposed Mid -Cycle Budget Adjustments
Schedule "A"
GENERAL FUND:
EXPENDITURE CHANGES:
Expenditure Increases:
Amount Account Name
Expenditure Decreases:
Account Number Description Amount Account Name Account Number Description
$ 18,350 Various- Personnel-P&Z Dept 01000-1115-6XXX Increase in Personnel Expense
$ 850 Insurance-P&Z Dept 01000-1115-7004 Increase insurance
Personnel benefit adj. & CM
$ 113,014 Various- City Manager Dept. 01000-1120-XXXX Contract Res.2025-087
$ 40,000 Salary Exp.-IT Dept. 01000-1121-6000 Personnel cost correction
$ 12,700 Health Insurance - Community Dev.Dept 01000-1122-6202 Personnel benefit adj.
$ 36,400 Various- Personnel -Police Dept. 01000-1210-6XXX Salary and Overtime needed
$ 29,000 Software/SaaS Subscriptions - General Services - Dept 01000-1180-7022 OpenGov Contract
Increase in Towing fees and
$ 37,000 Towing fees and Software /Sas Subscriptions -Police Dept. 01000-1210-7XXX Software /Sas Subscriptions
$ 15,000 Various- Personnel -Animal Control Dept. 01000-1212-6)0X Personnel cost adjustment
$ 167,240 Various- Personnel - Dispatch Dept. 01000-1213-6XXX Personnel cost adjustment
$ 20,000 Workers Comp -Fire Dept. 01000-1220-6102 Workers Comp Adj.
$ 10,000 Operating Supplies - Fire Dept. 01000-1220-7215 Medical Supplies
Increase of Volunteers
$ 4,100 Volunteer Fireman Stipend - Fire Volunteer Dept. 01000-1221-7806 Contribution
Adjustment to distribute and
allocate personnel expenses in
$ 772,823 Various- Depts 14XX Parks and Rec. 01000-14XX-6XXX different departments
$ 75,000 Various- Personnel- Rec Room Dept. 01000-1431-6XXX Funding TYC Position (2nd)
$ 202,176 Dept. 1500 Library Dept. 01000-15000-00C Entire Budget Adjustment
$ 1,553,653 Estimated Expenditure Increase
$
$
1,553,653 Estimated Expenditure Increases
(519,970) Estimated Expenditure Decreases
Estimated Net (Decrease) in Expenditures and
1,033,683 Transfers Out
Estimated Net Change in Fund Balance
1,033,683 Estimated Net (Decrease) in Revenues
1,033,683 Estimated Net (Decrease) in Expenditures
$ Estimated net change in fund balance
(124,319) Contingency -Street Dept. 01000-1310-7807 To correct Expense Line
Adjustment to distribute and
allocate personnel expenses in
(261,905) Various- Depts 14XX Parks and Rec. 01000-14XX-6XXX different departments
Adjustment to distribute and
allocate personnel expenses in
(18,563) Various- Depts 14XX Parks and Rec. 01000-14)0C-6XXX different departments
Adjustment to distribute and
allocate personnel expenses in
(145.00) Various- Depts 14XX Parks and Rec. 01000-14XX-6XXX different departments
Adjustment to distribute and
allocate personnel expenses in
(6,160.00) Various- Depts 14XX Parks and Rec. 01000-14)0C-6XXX different departments
Adjustment to distribute and
allocate personnel expenses in
(40,910.00) Various- Depts 14XX Parks and Rec. 01000-14XX-6XXX different departments
Adjustment to distribute and
allocate personnel expenses in
(61,848.00) Various- Depts 14XX Parks and Rec. 01000-14)0C-6XXX different departments
(6,120.00) Unemployment Insurance- Library Dept. 01000-15000-6101 Entire Budget Adjustment
$ (519,970) Estimated Expenditure Decrease