The City of Webster City presented a proposed budget for fiscal year 25/26 — the year running from July 1, 2025 through June 30, 2026 — approximately $60,000, or 1%, larger than last year’s.

The adopted 24/25 budget is $4,801,836, and the budget proposed for 25/26 totals $4,862,275.

The increase is due to rising costs of employee benefits and continued inflation in the U.S. economy.

City Manager John Harrenstein and Finance Director Dodie Wolfgram, assisted by Budget Assistant Sherry Simmons, began working on the budget last fall, meeting with department managers and asking them to justify each line item in their individual department budgets.

This allowed staff to differentiate “must-have” expenses from “nice-to-have” ones. The intensive, thorough process carried an unspoken message: 2025/2026 is a year to hold the line.

In her brief presentation to the Council and the public, Wolfgram said Monday, “this levy will result in slightly lower taxes for local property owners.”

The new levy will lower taxes about $22 on a hypothetical $100,000 home.

Harrenstein described the new budget as “re-sizing ourselves for our financial future.”

The process began by looking at staffing. The new budget eliminates six FTEs — full-time equivalents — from the city’s roster of approved positions. No one at City Hall actually lost their job, but now no one can be hired for those positions in the future, effectively capping the size of city staff.

The eliminated positions are: assistant city manager, a position originally created for Kent Harfst; public works director, a position vacant for many years; community vitality director, a position once held by Lindsay Henderson; building inspector, currently contracted to Veenstra & Kimm, West Des Moines; city clerk, a position shared by Harrenstein and Simmons, and the Street Department’s mechanic.

One new staff position, recreation technician, is being added. It replaces the job once held by Larry Flaws and will help support the growth of recreation in Webster City.

Every budget, whether for an individual person, family, business or government, must first look at revenues, the income side of the ledger.

The city’s income is projected to drop by $1,200,457 in the new budget. The previous year’s income included $180,000 in donations to the East Twin Park splash pad. Those won’t recur this year. Another $360,500, income from solid waste and recycling fees, is being moved to a new account. The remaining $838,000 is an accounting transfer from water, sewer and electric utility charges to the general fund.

Now, we’ll look at expenditures, the other side of the ledger in every budget, with a focus on the city’s General, Water, Sewer and Electric Funds.

General Fund

Total general fund expenses are estimated to be $5,351,174 in the new fiscal year, a decline of $393,766.

Quoting from the city administration’s letter to the mayor and Council, regarding the budget proposal: “Other areas of spending remained relatively flat with the exception of contractual services. Of the $127,985 increase in proposed spending in this area, approximately $100,000 has been set aside for abatement or demolition of nuisance properties.”

A steady increase in the number of derelict buildings in Webster City in recent years, has led the city to tighten code requirements pertaining to the responsibilities of property owners. It has also resulted in the city having to buy and demolish vacant, unsafe buildings. The new budget earmarks $100,000 for “abatement or demolition of nuisance properties.”

Staff proposes setting aside $400,000 to fund routine equipment replacements in several departments in the next five years. This includes $215,000 earmarked for Fuller Hall, the outdoor pool, parks, and Graceland Cemetery; $100,000 for the Police Department, and $85,000 for the Fire Department.

The ending balance in the General Fund under the new budget is 47% of planned expenditures.

Again quoting from the city administration’s budget narrative: “The fund balance policy adopted by City Council calls for a general fund reserve between 35% and 50%. While the proposed budget meets the reserve fund policy target, it’s estimated in the next five years, the balance will fall below the recommended amount. As a result, future year budget cuts or revenue growth of between $125,000-$400,000 will be needed to bring estimated spending into structural balance.”

Water Fund

Total revenues from sales of treated water will increase $84,211 in the new fiscal year, while expenses will rise $212,590. The 15% increase in water rates in 2023, plus the $5,135,000 water bond issue enacted last year should provide enough money to keep the water treatment plant operating until it can eventually be replaced.

While the new budget appears adequate for the FY 25/26 year, 1% annual water rate increases are likely in future years, as is the case today in the electric fund. Water sales to residents of the Wilson Estates project are not included in the budget.

Sewer Fund

The 25% increase in sewer rates Webster Citians have been paying since January 2024 is largely responsible for a $418,553 increase in sewer fund revenues. Total expenditures by the fund are expected to decrease by $660,205 as in FY 24/25 the sewer fund repaid the General Fund for property purchase and legal costs related to the former design and site of the city’s new wastewater plant. As with the water fund, sewer revenues do not include any revenue from Wilson Estates.

Electric Fund

Electric utility revenues should increase $412,241 in FY 25/26. This is due to a 2.3% increase in rates charged the city by its main electricity supplier, Corn Belt Electric Cooperative, and the normal 1% increase in electric rates mandated by the City Council. Electric revenues do include a forecast of electric sales to homes in Wilson Estates.