FY27 Proposed Budget

its vision and strategies, account for changing circumstances, and further focus desired action steps. The following highlighted actions help implement this plan.

Affordable Housing

A key focus of City Council has been addressing the housing affordability crisis with a special focus on low-income households. Beyond the $3.5 million in annual LOST funding dedicated to affordable housing, the FY 2027 budget retains the $1,000,000 General Fund transfer to the Affordable Housing Fund. Allocations from this fund support the Housing Trust Fund of Johnson County, CommUnity security deposit program, housing rehabilitation, landlord risk mitigation, and emergent situations. The City is also implementing its nearly $3.8 million Pathways to Removing Obstacles to Housing (PRO Housing) federal grant. The Comprehensive Plan update should be completed in FY 2027, with funding for a subsequent zoning code update included in the FY 2027 budget. The City is also actively working on its pilot development project on N. Summit Street after producing a plan for City-led development activities. This budget also reflects the City repositioning its Public Housing program to improve its financial sustainability while facilitating growth in the City’s publicly owned housing stock. The City will also continue to explore the best way to support these efforts using previously generated funds for affordable housing totaling more than $6.5 million. Supplemental revenue streams include fee-in-lieu payments, tax increment financing, and federal grants which help further expand capacity for affordable housing investment without additional property taxes. Fare-free transit continues to be successful with passenger trips increasing by more than 68% over the two-year pilot. The public also indicates improved experiences with transit. In a representative survey of community residents in the fall of 2024, 76% rated the quality of transit service as good or excellent, an increase of 13% since the last community survey taken in 2017. As a result, the FY 2027 budget maintains the financial supports necessary for a zero-fare system, including subsidies funded by the parking fees and citations increased in FY 2025 and the 1% increase to the gas and electric franchise fee from FY 2026. However, these revenue sources will not grow at the same rate as operational expenses, so additional sources of funding may be required in the future. The program is also dependent on federal funds, which are more volatile now that at any point in recent history. Regardless, the City’s commitment to sustaining fare-free transit and construction of the new transit building will ensure our community can boast one of the most robust and accessible transit systems in the country. Unlike the FY 2026, this budget allows an expansion of several value-add investments, thanks largely to increased revenue from LOST. In FY 2026, Council substantially increased Aid to Agencies grant funding for social service agencies by 41.4% over the budgeted amount. The FY 2027 budget further increases this by approximately $143,000, or 13.1%, to $1.23 million, which is more than triple the funding provided in FY 2019. In addition to seeding a potentially transformational long-term endowment for the arts, partner funding commitments are also Fare-Free Transit Partnerships and Engagement

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