Bruceville‑Eddy reviews draft FY 2026–27 budget as staff warns water fund could run short in months

City Administrator Lawrence presented the Bruceville‑Eddy draft FY 2026–27 budget at a July 17 workshop and recommended the document be built on a No‑New‑Revenue (NNR) basis — meaning no proposed tax increase.

“The draft budget is built as an NNR — no new revenue, no tax increase,” Lawrence said as he walked the council through preliminary county valuations and revenue projections. He told council the draft currently shows roughly a $22,000 general‑fund surplus and a projected $58,000 surplus in the water fund under existing rates, but he warned that longer‑term pressures threaten those positions.

“Talking with Esther, our finance director, she believes that we have less than five months left of monies in the water fund to continue operating — we’re about to overdraft,” Lawrence told the council, citing the finance director’s assessment and urging options other than drawing reserves.

The presentation moved quickly from general‑fund assumptions to a detailed look at utility finances: Lawrence and staff outlined a sewer‑fund deficit projected near $278,000 and a list of capital priorities that together could require approximately $400,000 in the upcoming budget and about $500,000 the following year if the council chooses to move forward with tank replacements and other projects.

Jean Stapp, water‑department maintenance lead, urged the council to begin a 10‑year tank‑maintenance program based on inspection findings. “We’re going to need work on the elevated tanks. I’ve got pictures from two years ago of the ladders inside the tank deteriorating and the paint,” Stapp said, and recommended starting preventive maintenance before failures occur.

To avoid further reserve depletion, staff recommended revenue options rather than one‑time draws. Lawrence outlined several alternatives: adjusting tiers inside city limits, restoring an outside‑city rate (staff suggested a 30% differential), raising the meter base fee (examples discussed included a $5 flat increase), or a combination. Staff estimated a conservative revenue range of roughly $200,000–$300,000 from the combined tier and base changes, and proposed that the council consider a $5 flat meter increase or similar options to cover capital needs and rising wholesale costs from the city’s water supplier.

Council members asked for clearer cost estimates on personnel choices (such as increasing the TMRS retirement match from 1–1.5 to 2–1), and Lawrence agreed to circulate updated math by email and bring revised sheets to the next meeting. The council also discussed upgrading meeting audiovisual capabilities to allow remote presentations, employee uniforming, and budgeting conventions (operation & maintenance vs. capital).

Lawrence flagged recent project cost escalations, saying change orders and mediation have increased contracts by roughly $2.36 million on the larger water/sewer program and that about 77% of the project financing has already been expended. He said he will require more detailed change‑order documentation from contractors before authorizing further increases.

No budget vote was taken. Council members asked staff to prepare formal quotes for equipment requests (including a new sewer jetter), to provide clearer TMRS cost breakdowns, and to schedule a public hearing and additional workshops before any tax rate or rate‑change adoption.

The council adjourned after agreeing to return to several follow‑up items and to circulate printed worksheets and the presentation to allow individual line‑by‑line review prior to a future vote.