The Prescott City Council got a sobering midyear budget update Tuesday, highlighting mounting challenges like soaring health insurance costs, potential state revenue cuts, and a deepening deficit in the solid waste fund that could mean higher trash fees for residents.
Finance Director Lars Johnson reported the city’s $303 million budget is on track overall, with operations at 47% spent through December—near the 50% benchmark—but capital projects lag at 21% due to delays. Johnson warned of statewide threats, including a possible food tax elimination that could slash $10.4 million annually, forcing deep service cuts. Health premiums are jumping 19%, adding pressure amid 1.2% cost-of-living raises. The solid waste fund, an enterprise meant to self-fund, posted a $400,000 deficit last year and faces another this year from higher hauling costs (up 40–73%) and lower-than-expected revenues.
Field Operations Manager Brady Higgs explained:
Council discussed options like expediting planned rate hikes—residential from $24.33 to $26.45 monthly, gate fees from $106 to $120 per ton—or rethinking services like woodchip hauling. Councilman Ted Gambogi quipped:
Mayor Cathey Rusing urged exploring cuts, like on-site chipping for fire-wise programs. City Manager Dallin Kimble used a house-building analogy, stressing recurring revenues as the foundation before discretionary spending. Workshops start April 27 to finalize the FY27 budget by June.