The City of Kenai’s budget for fiscal year 2026 — stretching from July 1, 2025, to June 30, 2026 — should avoid increasing taxes, include competitive compensation to that offered by other public employers, increase rates and fees in line with inflation and ensure that the city is spending at least as much on capital projects as it is losing in value from depreciation.

That’s all according to a resolution adopted unanimously last week setting “goals to guide the preparation” of the next budget. The resolution saw no discussion by council members last week, though it was the subject of a work session in December. There was one public comment submitted via email by Barbara Waters in opposition to the proposed increase to water and sewer bills.

The specific goals, of which seven are described in the resolution, will guide Kenai’s administration in preparing the budget document that will be considered in the spring.

“The goal is to avoid a tax increase while meeting the City’s operation and long-term financial obligations,” the first reads. It doesn’t rule out that an increase could happen, but says that flexibility is “only if necessary” for Kenai’s fiscal stability and codified fund balance policies.

A review of Kenai’s salary schedule and pay plan is also described in the document, with “a salary increase not to exceed inflation” if the findings suggest Kenai’s wages are not competitive. Also set for review are Kenai’s various insurance benefits — which need to be financially sustainable while also providing adequate coverage.

The document also calls for compilation of a list of capital projects to ensure that the city is investing in its infrastructure at least to the same amount as its infrastructure value is depreciating — prescribing at least a roughly $5 million spend.

An increase in “rates, charges, and fees across all funds” is set to match the Annual Alaska Consumer Price Index — with a cap only on the increase to monthly rent at Vintage Pointe of at most $50 more per month.

The document also describes values below which various funds may not fall at the end of the projected budget.

Creation of the next budget will be “challenging,” Kenai Finance Director Dave Swarner writes in a memo attached to the resolution. Revenues in Kenai “continue to increase,” but expenditures are increasing faster. Sales tax revenues for the current fiscal year are below projected rates.

The full text of the resolution can be found at kenai.city. A recording of the Jan. 15 meeting and Dec. 4 work session can be found on YouTube at “City of Kenai – Public Meetings”

Reach reporter Jake Dye at jacob.dye@peninsulaclarion.com.