By BECKY KISER
Hays Post
A "cautionary approach" is how Deputy City Manager Collin Bielser described the proposed 2026 budget to Hays city commissioners at their work session last week.
"It is important to note the city does remain financially sound," Bielser said. "We're not expanding, and instead focusing on maintaining operations."
The total assessed valuation is up 2.5% from 2025. The mill levy will stay at 25 mills for the 17th consecutive year.
The balanced budget includes a programmed 2% step and a 3% cost-of-living pay increase for all city employees.
Sales tax revenues, which account for the majority of the general fund, are budgeted for a 2% increase over 2025 projections.
Last year, staff told the commission the mill levy would have to go up one mill to fund airport operations. City commissioners asked staff to keep the mill levy at 25 mills while also increasing the airport's resources.
The mill levy does remain the same, while the draft 2026 budget increases the number of mills allocated to the Hays Regional Airport, from 1.5 to 2.5 mills.
For the last few years, the airport has been able to sustain itself due to federal funding following the COVID-19 pandemic. Those funds have now been exhausted.
A terminal planning study will be done with $350,000 marked for it. Enplanements at the Hays Regional Airport are at a record high so far this year and the terminal space is inadequate.
Fifty-passenger jets such as those flown by SkyWest, the airport's air carrier, are no longer being manufactured and will eventually be phased out. At that point, the airport's terminal space will need to be large enough to accommodate planes that carry 70 or more passengers.
"I continue to say we're rock stars compared to other communities," said Mayor Sandy Jacobs at the end of the presentation, "and I think that will continue if we keep our heads where they're at, understand that we don't want to overspend, that we don't want to put a budget out there that is not sustainable.
"I'm really appreciative of all the departments and the work they put into it...but we're not naive enough to know that 25 mills is still more than it was. We're spending more than we have (in the past)", Jacobs said.
The 2026 draft budget is available on the city's website. Commissioners will further review the budget at their August 7 work session.
Also on the July 3 agenda was a review of two resolutions to issue bonds for infrastructure on city-owned property at Exit 161 of Interstate 70 and for the Grove development public infrastructure.
The city previously created the Grove Reinvestment Housing Improvement District and entered into a development agreement with Grow Hays to finance the public infrastructure related to the district. Approval of the resolution would allow the city to issue general obligation bonds to fund the public infrastructure improvements related to the incentive district and Exit 161.
The Grove public infrastructure costs are estimated to total $3.7 million. Based on future projections, the city estimates the incentive district increment will be sufficient to pay the debt service on bonds issued to fund public infrastructure, as well as the bonds issued to finance a related $825,000 economic development grant.
The anticipated costs of the Exit 161 infrastructure are about $4 million net of the proposed grant.