Council holds FY27 budget hearing, advances first readings; staff proposes water and sewer rate increases

Murfreesboro — The City Council opened a public hearing on the fiscal year 2027 budget May 21, received no public speakers, approved first reading of the budget ordinance and approved an intent ordinance regarding the certified tax rate, and heard a separate staff presentation proposing changes to water and sewer rates.

City staff told council the city has not yet received the new certified tax rate because this is a reappraisal year; staff introduced Ordinance 26 O 16 to indicate council intends to adopt the certified tax rate once the county certifies it. The council approved first readings of the budget ordinance (26 O 15) and the intent tax‑rate ordinance by roll call.

Miss Smith presented the proposed FY27 water and sewer rates based on a cost‑of‑service study and a pro forma that accounts for approximately $148 million in projected debt. She said the proposed water rate changes include a $0.75 increase for residential accounts and a commodity charge increase of $0.10 per 1,000 gallons. For sewer, staff proposed a $1.00 residential increase and a commodity charge increase of $0.05 per 1,000 gallons; staff said these adjustments aim to reach target rate recovery over the next five years.

Miss Smith also noted the ordinance presented to council indicates an intent to adopt the certified tax rate once it becomes available; if council later decides a rate increase is needed, staff said another public hearing would be required.

Council approved the related ordinance motions on first reading by roll call. Staff said another cost‑of‑service review will be provided in the coming years to revisit rates and to refine long‑term financial forecasts.

Next steps: The public hearing record for the budget will remain part of the ordinance process; staff will return with the certified tax rate once it is available and with future rate modeling updates.