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2/9/2026 <br />7 <br />Update on General Fund Long-Term Financial Forecast <br />•Long-term forecast projects the future financial outcome and serves as a <br />strategic tool to guide policy and decision-making <br />•Four scenarios are included: <br />1.Baseline (most likely) <br />2.Recession (pessimistic) <br />3.Hotel tax measure (optimistic) <br />4.New development projects (very optimistic) <br />•Forecast does not reflect budget balancing strategies <br />•Operating deficits range from $6.0M to $10.0M* <br />13 <br />*The $44.0M annual funding gap identified in the Asset Management Plan is not addressed in the forecast. <br />Key Assumptions Beyond Current Budget Cycle <br />(Revenue Annual Growth) <br />•Property tax: 3.7% to 3.8% (Note: FY27 growth rate is projected to be less than 3.0%) <br />•Sales tax: 2.8% to 3.0% <br />•Business license tax: 3.0% <br />•Hotel tax: 2.0% <br />•Franchise fees: 2.5% <br />•Permits, charges for services, recreation revenues, and interfund charges: 3.0% <br />•Other operating revenues: 2.0% <br />14 <br />13 <br />14 <br />Page 93 of 144