The City of Peoria’s proposed financial plan for 2026 sees the property tax rate virtually unchanged from the current fiscal year, but a $3 million overall budget imbalance has some city council members suggesting spending cuts.
During a nearly three-hour special meeting Tuesday to kick off the budget process, the council unanimously approved the estimated taxes to be levied at $34.4 million, with the rate for truth in taxation purposes holdingd steady at $1.3483 per $100 assessed valuation.
When the topic switched to the budget itself, council members Denis Cyr and John Kelly expressed distaste for the spending gap after finance director Kyle Cratty outlined the recommended $301 spending plan in a 33-slide presentation.
“I’m a little disappointed as usual because we have a 1% deficit, a $3 million deficit for this year — and about a million dollars for ’27 — and it seems to me that ideally we should have a balanced budget, but we never do. And we're so close, we're so close — and yet we always go over,” said Kelly, who held the floor for 23 minutes in posing questions for Cratty.
Cyr noted that even after the budget is approved, the council typically considers one or two budget amendments each month over the course of a year. He recommended considering spending cuts to achieve a true balance without increasing the burden on taxpayers.
“Our constituents are having higher water bills, they're having higher energy bills,” said Cyr. “They'll have a higher real estate taxes bill. I mean, I think it's just a bad time to have all these increases.”
The $34.4 million estimated tax levy for operational expenses represents close to a 6.6% increase over the amount levied in 2025, largely based on an increase in equalized assessed valuation [EAV].
Cratty noted the estimated tax levy figures do not include tax levies for bonds in the calculation.
“Really, our aggregate levy is around $39 million. For both the city portion as well as the library portion, we have debt that automatically is levied at the time that the bonds are issued. So that is an amount above and beyond, and is already set,” said Cratty.
“I think the key in this conversation is, as we have in the past in bringing this to council, we are maintaining the rate as to what the final rate was once the county levied the taxes for the 2025 fiscal year. The one thing I will point out is when we had gone through this process last year, we had assumed around a 7.2% increase in overall EAV. The final number was closer to 8.2%, so we actually saw our rate drop slightly.”
Cratty’s budget presentation outlined anticipated revenue of $298 million, along with operational expenses targeted at $216.6 million, an increase of 7.7% due to higher benefits and pension costs. Funding for capital projects drops 36.7% to $48.9 million, while debt payments total $21.5 million.
A township action saw the trustees approve an estimated tax levy of $1.42 million with a rate not to exceed $0.743. That represents a $5 decrease, marking a third straight year with a lower rate.
In the only other item of regular business, the council unanimously approved a temporary outdoor liquor license site application for Real Steel’s inaugural Warehouse District “Block-tober Fest” fundraiser from 9 a.m.-9 p.m. Saturday on Oak Street between Adams and Jefferson.
