Grant adopts $9.84 million budget, increases property tax request
BY SAMANTHA GOFF
GRANT TRIBUNE-SENTINEL
The Grant City Council adopted a $9.84 million budget Sept. 28 for the 2026-27 fiscal year, increasing the city’s property tax request by nearly $67,000 as it plans for infrastructure, utility operations and debt payments.
The budget includes $9,836,813.29 in disbursements and transfers, an increase of $1,057,753.93, or 12.05%, over the previous year’s approved budget.
The property tax request increased from $344,164 to $411,158.10, a rise of $66,994.10, or 19.47%. The fiscal year began Oct. 1 and ends Sept. 30, 2027.
The overall budget and property tax request represent different parts of the city’s finances. The budget includes utilities, capital projects, debt payments and transfers between city funds. Property taxes account for approximately 4.18% of that total, with other financing coming from utility receipts, sales taxes, grants, borrowing and existing cash balances.
The property tax request includes $401,158.10 for purposes other than bonds and $10,000 for bonds.
The budget projects an ending cash reserve of about $5.03 million, much of it held in utility and other designated funds. Departmental worksheets show planned disbursements and transfers exceeding annual receipts by approximately $2.2 million, reflecting a planned use of existing balances.
Subdivision financing
The Community Redevelopment Authority’s housing subdivision is one contributor to the city’s financial commitments, involving infrastructure construction, utility investments, loans and debt repayment.
The redevelopment plan, approved by the council Sept. 9, outlines temporary city funding for sewer, water and other subdivision infrastructure. The CRA is expected to repay at least $510,000 through tax increment financing, known as TIF.
The first phase has an estimated cost of $1,445,037.41. Major expenses include $832,070 for Van Kirk Bros., $305,136.60 for electrical lines, $126,985 for engineering and $98,919.57 for land acquisition.
The estimate also includes surveying, legal fees, a state water fee and project overage.
The funding plan combines $205,151.24 in federal American Rescue Plan Act money, $535,830 in bond proceeds, $300,000 in city and Economic Development loans, $305,136.60 from the Electric Fund and $98,919.57 in existing cash for land acquisition.
Those figures describe the project’s estimated funding and costs, rather than an additional property tax request.
The city also extended repayment schedules for two subdivision loans: $125,000 from the General Fund and $125,000 from the Economic Development Fund.
Both loans carry no interest and call for annual payments of up to $6,250 each. The amendments moved the first scheduled payments from Oct. 1, 2026, to Oct. 1, 2030, and the final payments from 2045 to 2049.
The changes delay scheduled repayments to the lending funds by four years.
For the new fiscal year, the CRA budget includes $125,000 in borrowing from Economic Development and $325,000 from pooled checking. The General Fund includes a matching $325,000 loan allowance, up from $300,000 in the previous budget.
The loan agreements, project estimates and annual budget allowances reflect different stages of financing and cannot be added together as separate construction expenses.
The CRA’s expenditure budget increased by $55,245 to $1,173,986.34. It includes $580,000 in capital outlay, $40,000 in professional services and $530,250 across two lines associated with bond anticipation notes.
City capital planning records also identify $325,000 for subdivision electrical service and $50,000 for subdivision water meters and meter pits.
Other planned water projects include well and water-main improvements. The records do not establish that all water spending serves the subdivision. The Water Fund’s $832,000 capital allowance is unchanged from the previous approved budget.
Debt repayment and TIF
City financing documents describe $510,000 in outstanding bond anticipation notes used for subdivision street, water and sewer improvements.
An ordinance proposing to replace that interim financing with up to $550,000 in general obligation bonds received its first reading Sept. 22. Action on a related resolution to call the existing notes for repayment was postponed to Oct. 27.
The available records do not establish that replacement bonds have been issued. Refinancing existing debt would replace a financing obligation rather than create another construction expense equal to the bond amount.
The CRA’s proposed repayment to the city would use TIF revenue.
Under the redevelopment plan, taxes on the subdivision’s original property value continue to go to the taxing bodies. Taxes generated by increased property value are directed toward redevelopment repayment for up to 15 years for each developed lot.
The plan states that CRA TIF bonds will not be guaranteed by the city or its taxpayers. The city’s obligations under its separate financing remain.
The CRA documents also propose a $510,000 tax increment revenue note carrying 5.5% annual interest, payable to the city from pledged TIF revenue. The available documents do not establish that the note was signed or delivered.
Property tax authority
Grant used its full calculated property tax request authority of $411,158.10.
That amount includes the previous year’s $344,164 request, allowances for real growth and inflation, exceptions for bonds and a public safety interlocal agreement, and $12,618.19 in previously unused authority.
Using the full dollar amount available under that calculation does not mean the city reached its regular property tax levy ceiling.
The city’s taxable valuation is $102,789,526. Excluding the $10,000 bond request, the regular levy calculates to approximately 39.03 cents per $100 of taxable value, below the 45-cent ceiling shown on the city’s budget form.
Including the bond levy, the total city rate is approximately 40 cents per $100 of taxable value.
At an unchanged taxable value of $100,000, that rate would produce approximately $400 in city property taxes, compared with about $361.70 at the previous stated levy.
Individual bills also depend on changes in property valuation and taxes imposed by other taxing bodies.
The request exceeded the separate notice threshold of $351,976.52, triggering the postcard notification and joint public hearing process.
Other budget changes include airport work, electricity costs, street improvements and swimming pool debt payments.
Although subdivision expenses are part of the city’s financial commitments, the budget records do not establish how much lower the property tax request would have been without the project.