To: Honorable Mayor and Members of Town Council
Through: David L. Corliss, Town Manager
From: Trish Muller CPA, Finance Director
Title
Resolution Approving the 2027-2031 Balanced Financial Plan for the Town of Castle Rock
Body
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Executive Summary
Long-term planning is a key component of the Town’s annual budget development process. The five-year Balanced Financial Plan provides a longer-term perspective that helps demonstrate the sustainability of Town funds. This planning framework is guided by Council-adopted long-range plans, which define service levels and establish priorities and projects, all while supporting conservative financial management. This approach continues in 2027 with the development of the 2027-2031 Balanced Financial Plan.
The 2027-2031 Balanced Financial Plan demonstrates that the Town is in good financial condition and although not all departmental budget requests were able to be accommodated, many requests to support Town priorities and level of service needs are included. All funds are balanced in each of the five years of the plan, meaning that funds available plus annual revenues exceed the total planned expenditures in all funds. This does include the planned use of $62.3 million of capital reserves for one-time capital projects, which is a common and sound financial practice.
The Proposed 2027 Budget estimates annual growth in sales tax revenue at 4.5%. Revenue from the Town’s general 4% sales tax is budgeted as follows in 2027: 74.75% toward the General Fund, 20% toward the Transportation Fund and 5.25% to the Community Center Fund. The voter-approved 0.2% sales tax is set aside for public safety expenditures. The Town’s property tax mill levy rate levy for 2027 is expected to be the same as the current rate of 0.92 mills when finalized in December. An increase to water rates and fees of 4-5% for existing customers is proposed in 2027, along with an increase to growth-related water resources system development fees. Inflationary increases are planned for all other development impact fees, as previously approved by Council. Greens fees at Red Hawk Ridge Golf Course and admission fees at the Recreation Center are also planned to be increased for 2027.
Personnel projections include a 15% increase in healthcare cost as well as an average 5% performance-based increase for general employees, with an average of 7.5% budgeted for eligible public safety personnel, who will also receive a 4% market adjustment at the beginning of 2027.
Overarching goals of the 2027-2031 Balanced Financial Plan include 1) providing healthy operating resources and capital projects in Town priority areas of transportation, water, parks, open space, and public safety and 2) maintaining current levels of service in a responsible and conservative manner.
DISCUSSION
2027 Budget Priorities
The 2027 Budget priorities used as the basis for development of the 2027-2031 Balanced Financial Plan include the proposal of a new priority related to open space, and can be summarized as follows:
• Ensure outstanding public safety
• Enhance our roads
• Secure our water future
• Maintain strong parks and recreation
• Support economic development
• Manage Town finances conservatively
• Preserve our community character
• Conserve our open space
Council has affirmed the above priorities and approach throughout the 2027 Budget process. These priorities are also supported in the 2025 community survey results as previously presented to Town Council.
Financial Overview
The 2027-2031 Balanced Financial Plan was developed using conservative and informed financial modeling and forecasting. Annual growth in sales tax revenue is included at 4.5% for 2027. Residential growth is expected to continue to slow over the five-year planning period and is budgeted at 350 single-family units and 400 multi-family units in 2027.
Financial Details
The 2027-2031 Balanced Financial Plan (Exhibit 1) shows the estimated costs of addressing high priority area level-of-service needs and of implementing additional major priorities and projects in all operating funds using projected resources. Included within the plan are 21 additional FTEs for 2027 needed to address top-priority level-of-service needs, along with needed increases in expenditures for equipment, technology, services, and capital projects. The following is a summary of the most significant items (generally, totaling $100,000 or more) in the plan for 2027, by fund and by department.
GENERAL FUND
Police Department:
• Add five Police positions - a dispatcher, a detective, a traffic officer, and two strategic response officers that were advanced from the 2028 plan
• Address additional needs of CRPD including $500,000 for expansion of dispatch, and $750,000 for rehabilitation of Perry Street stairs at PD headquarters, as well as equipment, software improvements and vehicles, and a Corporal rank enhancement
Fire Department:
• Add five Fire and Rescue positions: two firefighter/EMTs, a deputy chief, an emergency manager, and a new training captain
• Address additional needs of CRFD including $100,000 for large vehicle stabilization equipment, as well as funding for an update to the wildfire protection plan, wildfire predictive software, reclassification of six lieutenant positions to captains, and funding for gear, supplies and vehicles for new positions
Parks & Recreation Department (various funds):
• Opening of the Castle Rock Sports Center midyear; this includes the addition of five full-time positions and part-time staff
• Continue improvements at Lost Canyon Ranch Open Space; planned improvements include a new trailhead with parking and event pad to support community programs
• Plan trail connections to Douglas County’s Macanta Open Space
• Improvements at Red Hawk Ridge Golf Course that are funded by golf revenue include, funding for the design of the irrigation system replacement and course restrooms, clubhouse roof replacement, and replacement of golf carts
• Replacement of Recreation Center cardio exercise equipment and the Recreation Center sign
• Continue repairs and improvements at Cantril School, including exterior masonry and window restoration and outdoor improvements
TRANSPORTATION & TRANSPORTATION CAPITAL FUND:
• Complete an aggressive Pavement Maintenance Program, focused in 2027 on North Central Castle Rock, at an estimated 2027 cost of $18.5 million
• Design services for the widening of Fifth Street from the intersection of Woodlands Boulevard at Fifth Street to Fifth Street and Ridge Road
• Design of intersection improvements at Mikelson and Enderud boulevards and Aloha Drive and Founders Parkway
• Construction of a roundabout at Crystal Valley Parkway and West Loop Road
• One new Traffic Signal Technician II position and a bucket truck
CASTLE ROCK WATER FUNDS (Combined):
Continue projects, program and policies to advance the goal of securing 75% renewable water by 2050; reducing per-capita consumption to 100 gallons per day; and maintaining affordable rates and fees, including:
• Continue work to double the capacity of the Plum Creek Water Purification Facility, which is focused on renewable and reusable water supplies
• Construct the Liggett Road pipeline to support the facility’s expansion
• Start construction on the Plum Creek Central Pipeline also to support the facility’s expansion
• Construct the East Plum Creek to Rueter-Hess Reservoir pipeline
• Complete construction of the first phase of the ColoradoScape demonstration garden and continue funding ColoradoScape rebates
• Continue progress on the Chatfield Reallocation and Platte Valley Water Partnership projects
• Continue progress on the WISE project, including planning and design of a desalination facility
• Continue to fund operational expenses associated with the doubling of the amount of WISE water Castle Rock will receive in 2027
• Rehabilitate and replace water and sewer lines in the Young American neighborhood
• Complete the U.S. Highway 85 sewer project using Douglas County American Rescue Plan Act funds and design and construct gravity sewer in Sedalia using funds from customers and Douglas County
• Design and begin construction on McMurdo Gulch Priority 4 stabilization; rehabilitate storm sewers based on the results of video inspections; and address additional stormwater infrastructure needs caused by development in Crystal Valley
CONCLUSION
The overarching goals of the 2027-2031 Balanced Financial Plan are providing healthy operating resources and capital projects in Town priority areas of transportation, water, parks, open space and public safety and maintaining current levels of service in a responsible and conservative manner. Based on projected revenues, not all departmental requests were able to be accommodated; however, the included items align with Council priorities and endeavor to maintain levels of service in the community. The 2027-2031 Balanced Financial Plan demonstrates that the ongoing initiatives set forth within the 2027 Budget are sustainable and the one-time requests are able to be accommodated.
STAFF RECOMMENDATION
Staff recommends that Council approve the 2027-2031 Balanced Financial Plan as presented.
PROPOSED MOTION
I move to approve a Resolution Approving the 2027-2031 Balanced Financial Plan.
Alternative Motions
I move to approve the ordinance as introduced by title, with the following conditions: (list conditions).
I move to continue this item to the Town Council meeting on _____ date to allow additional time to (list information needed).
ATTACHMENT
Attachment A: Resolution
Exhibit 1: 2027-2031 Balanced Financial Plan