Proposed FY 2027 budget projects structurally balanced operations, reserves above new policy target

Mayor’s spending plan forecasts 43.4% General Fund reserve while continuing major capital investments without relying on reserves for day-to-day operations

Updated 7/1/2026@1:37PM: Adds links to official budget documents.

MANDEVILLE — Mandeville’s proposed Fiscal Year 2027 budget would mark a significant shift in the city’s financial planning, projecting a structurally balanced General Fund for the first time under the city’s newly adopted reserve policy while maintaining reserve levels well above the thresholds recently established by the City Council, according to the proposed 2027 budget documents released to the City Council last night.

The proposal projects recurring General Fund revenues exceeding recurring operating expenditures by approximately $199,000, while ending the fiscal year with a projected General Fund balance of about $10.26 million — equal to approximately 43.4 percent of annual operating expenditures. That exceeds both the new ordinance requiring a minimum reserve equal to 20 percent of annual operating expenditures and the companion resolution establishing a preferred target range of 30% to 40%.

Although the budget projects a nearly $2.93 million reduction in the General Fund after capital spending, city financial documents show that the decline stems from planned one-time investments in infrastructure and capital improvements rather than an operating deficit. The proposed five-year forecast continues to project recurring revenues sufficient to fund recurring governmental operations without relying on reserves.

The proposed FY 2027 budget adopts a noticeably more conservative approach to measuring structural balance than the city’s previous financial plan. Most notably, the five-year forecast reduces the amount of intergovernmental revenue treated as recurring from approximately $4.69 million in the FY 2026 forecast to just $100,000 in the FY 2027 forecast, while also lowering projected personnel growth and adding a reserve compliance test tied to the council’s new financial policies.

For several years, political opponents speaking during public comment and writing on social media have argued that the city’s budgets were not structurally balanced because recurring operating expenditures exceeded recurring revenues once one-time funding sources were excluded. The proposed FY 2027 budget appears to address those concerns, projecting recurring revenues sufficient to fund recurring operations while continuing to use reserves only for one-time capital investments.

Key takeaways

Structurally balanced operations

The proposed FY 2027 budget projects recurring General Fund revenues of $23.82 million against recurring operating expenditures of $23.62 million, resulting in an operating surplus of approximately $199,000 before capital spending. In municipal finance, that is generally considered a structurally balanced budget because recurring governmental operations are funded with recurring revenue rather than one-time funding or reserve drawdowns.

Reserve policy begins with a substantial cushion

The proposal is the first budget prepared following adoption of Ordinance 26-16 and Resolution 26-25 establishing new reserve standards.

Under the ordinance, future budgets may not be adopted with an unassigned General Fund balance below 20 percent of annual operating expenditures. The companion resolution establishes a policy goal of maintaining reserves between 30% and 40% whenever practical.

The proposed FY 2027 budget projects reserves at approximately 43.4 percent, placing the city above the council’s preferred target range while more than doubling the ordinance’s minimum requirement. The five-year forecast projects reserves remaining above the 20 percent minimum throughout the planning period.

More conservative forecasting assumptions

Compared with the FY 2026 financial plan, the FY 2027 forecast adopts noticeably more conservative assumptions.

The five-year forecast sharply reduces the amount of intergovernmental revenue treated as recurring, lowers projected long-term personnel cost growth and incorporates a formal reserve compliance analysis tied to the city’s newly adopted reserve policy.

Slower growth in personnel costs

The city’s five-year planning assumptions reduce projected annual personnel cost growth from 4.5 percent in last year’s forecast to 2.5 percent beginning with FY 2027, reflecting a more restrained outlook for one of the city’s largest operating expenses.

Capital investment continues

The city also proposes an approximately $27 million capital program spanning parks, drainage, shoreline protection, streets, utilities and public safety facilities.

The five-year forecast projects a net General Fund impact of approximately $3.13 million for capital spending after anticipated grant funding, resulting in a projected $2.93 million reduction in the General Fund balance. Budget documents indicate the reserve drawdown reflects a deliberate investment in one-time capital improvements rather than using reserves to finance recurring operating costs.

The proposed budget will now move to the City Council for public review and workshop sessions before the beginning of the 2027 fiscal year adoption process.

FY 2027 Proposed Budget Exhibit A – Capital

FY 2027 Proposed Budget Exhibit B – Operating

FY 2027 Proposed Budget Exhibit C – Position-Salary

FY 2027 Proposed Budget Exhibit D – Mayor Pay

FY 2027 Proposed Budget Exhibit E – City Council Pay

FY 2027 Proposed Budget Exhibit F – Fund Summaries

FY 2027 Proposed Budget General Fund Report

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