To: Honorable Mayor and Members of Town Council
Through: David L. Corliss, Town Manager
From: Trish Muller, CPA, Finance Director
Title
Ordinance Approving the First Amendment to the 2026 Fiscal Year Budget by Making Supplemental Appropriations for the 2026 Fiscal Year (First Reading)
Body
________________________________________________________________________________
Executive Summary
The charter for the Town of Castle Rock allows for amendments to budget appropriations, including requests for supplemental appropriations that require approval by ordinance (Section 9.10). The Finance Department prepares budget amendments for Town Council consideration based on needs that may arise throughout the year. The number of budget amendments varies by year depending on needs/opportunities as they are identified. The chart below shows supplemental appropriations for the last five years.
|
Fiscal Year |
|
Revenue |
Supplemental Appropriations |
|
2021 |
Carryforward Amendment |
$ - |
$ 49,824,231 |
|
|
1st Amendment |
$ 125,000 |
$ 5,720,437 |
|
|
2nd Amendment |
$ 2,386,282 |
$ 1,301,727 |
|
|
3rd Amendment |
$ - |
$ 4,919,933 |
|
2022 |
Carryforward Amendment |
$ - |
$ 37,308,413 |
|
|
1st Amendment |
$ 36,122,836 |
$ 36,674,688 |
|
|
2nd Amendment |
$ 20,437,317 |
$ 19,128,116 |
|
|
3rd Amendment |
$ 3,828,740 |
$ 12,844,306 |
|
|
4th Amendment |
$ 3,048,711 |
$ 12,626,501 |
|
2023 |
Carryforward Amendment |
$ - |
$ 84,357,215 |
|
|
1st Amendment |
$ 167,880 |
$ 5,902,635 |
|
|
2nd Amendment |
$ 165,795,674 |
$ 191,637,745 |
|
|
3rd Amendment |
$ 2,700,944 |
$ 6,115,138 |
|
|
4th Amendment |
$ 4,616,807 |
$ 4,815,754 |
|
2024 |
Carryforward Amendment |
$ - |
$ 91,124,553 |
|
|
1st Amendment |
$ 164,029,503 |
$ 176,602,796 |
|
|
2nd Amendment |
$ 445,888 |
$ 12,825,188 |
|
|
3rd Amendment |
$ 3,457,757 |
$ 4,271,821 |
|
2025 |
Carryforward Amendment |
$ - |
$ 157,580,495 |
|
|
1st Amendment |
$ 67,100,481 |
$ 17,566,084 |
|
|
2nd Amendment |
$ 82,695,142 |
$ 81,526,589 |
|
|
3rd Amendment |
$ 2,983,326 |
$ 11,555,426 |
Supplemental expenditure requests in this proposed First Amendment to the 2026 Budget total $10,609,944. Also, an additional $26,693,267 of revenue is being requested. Descriptions of requested items are included in Attachment B. The Finance Department has reviewed all requests and has determined that sufficient funding is available to accommodate this proposed First Amendment to the 2026 Budget. Following is a summary of requested items.
Discussion
Total requested changes to appropriations referred to in Attachment B increase total expenditures for 2026 by $10,609,944. Major requests included in this budget amendment are described below and are grouped by Town priority.
Secure our water future
• Castle Rock Water is requesting to re-appropriate Wastewater funds totaling $145,000 that were included in the 2025 budget to fund an anticipated shortfall in the replacement contributions for the purchase of a replacement truck and vacuum truck, due to timing the purchase order was carried forward to 2026.
• Castle Rock Water is requesting supplemental appropriation totaling $178,390 in the Water Resources Fund personnel costs for an anticipated shortfall in those accounts related to staff costs that were approved as part of a 2025 budget amendment but were inadvertently omitted from the 2026 budget document.
• Castle Rock Water is requesting supplemental appropriation totaling $27,000 in the Water, Water Resources, Stormwater and Wastewater Funds to purchase four vehicles from Development Services that are no longer needed. These vehicles will be taken out of the Replacement Program and utilized as reserve vehicles for Castle Rock Water.
• Castle Rock Water is requesting supplemental appropriation totaling $150,000 in the Water Fund for the design phase of the Water Storage Tank CL2 Analyzer and Mixer Modifications Project.
• Castle Rock Water is requesting supplemental appropriation totaling $505,068 in the Water, Water Resources and Wastewater Funds for an Arc Flash assessment of electrical equipment across Water, Wastewater, and Facilities sites to identify electrical hazards, label equipment, and ensure compliance with safety standards.
Enhancing our transportation
• The Public Works Department is requesting to re-appropriate Transportation funds totaling $1,063,888 for the Pavement Maintenance Improvement Plan. These funds were budgeted for and went unspent in 2025.
• The Public Works Department is requesting to re-appropriate Transportation funds totaling $343,841 for bridge repair and maintenance. These funds were budgeted for and went unspent in 2025.
• The Public Works Department is requesting supplemental funds in the Transportation Fund of $400,000 to fund the Town’s share of the costs to establish the Link on Demand Micro Transit Pilot Program.
• The Public Works Department is requesting supplemental funds in the Transportation Capital Fund of $750,000 for the Founders Parkway Traffic Operations and Safety Study project that Council approved as a revision to the Town’s 5-year plan at the March 24th Council meeting.
• The Public Works Department is requesting supplemental funds in the Transportation Capital Fund of $450,000 for the development of a roundabout at Crystal Valley and W. Loop Rd. project that Council approved as a revision to the Town’s 5-year plan at the March 24th Council meeting. This request is off-set with an increase in revenue appropriation.
• The Public Works Department is requesting supplemental appropriation in the Fleet Fund totaling $3,800,000 to begin the order of two replacement apparatus for the Fire and Rescue Department. Due to the lengthy turn-around of 4-5 years on Fire apparatus it has been determined that the equipment must be ordered now in order to have it on hand when it is needed. This is offset by Fire General Fund replacement contributions collected in the Fleet Fund.
• The Public Works Department is requesting supplemental appropriation in the Fleet Fund totaling $52,500 for the replacement of three gas mowers with electric mowers for the Parks and Recreation Department. This is offset by Parks General Fund replacement contributions collected in the Fleet Fund.
• The Public Works Department is requesting supplemental appropriation in the Fleet Fund totaling $73,930 for various operating needs including; uniforms, a new vehicle lift, training, outsourced vehicle repair, equipment and software maintenance.
• The Public Works Department is requesting to re-appropriate 2025 revenue budget in the Transportation Capital Fund of $17,595,262 related to the Crystal Valley Interchange project.
• The Public Works Department is requesting to re-appropriate 2025 revenue budget in the Transportation Capital Fund of $3,500,000 for a Federal Grant awarded for the 5th St. Widening project.
• The Public Works Department is requesting supplemental revenue appropriation totaling $211,003 in the Fleet Fund for expected increases in revenue related to transfers in from the General Fund and the Wastewater Fund.
Maintain strong Parks and Recreation
• The Parks and Recreation Department is requesting to re-appropriate $4,335,000 in the General Fund revenue budget related to a grant from DRCOG for engineering, design, and construction of a trail connecting Philip S. Miller Park to Downtown Castle Rock. The corresponding expense is part of the Capital Carryforward process.
• The Parks and Recreation Department is requesting re-appropriate $50,000 in the General Fund to repair the Rock Park Access Road. This was budgeted in 2025 but was unable to be completed.
• The Parks and Recreation Department is requesting to re-appropriate unspent General Long Term Planning Funds of $117,522 to resurface the Douglas County High School tennis court (per IGA) that did not occur as planned in 2025 due to project timing.
Ensure outstanding public safety
• The Fire Department is requesting to re-appropriate General funds of $40,000 for a Continuity of Operation Plan (COOP) Consultant to assist in the development of the Town's plan, as this was not completed in 2025.
• The Fire Department is requesting to re-appropriate unspent TABOR funds of $312,513 for town-wide Fire mitigation efforts. These funds were budgeted for and went unspent in 2025.
• The Fire Department is requesting supplemental appropriation in the Fire Capital fund totaling $355,190 related to the final construction budget, interfund loan interest payments, and issuance of the COP for Fire Station 156. This is offset by an increase in revenue.
• The Police Department is requesting supplemental appropriation of $66,000 in the General Fund to fund a shortfall in replacement contributions for the purchase of replacement police vehicles.
• The Police Department is requesting supplemental appropriation in the General Fund of $34,730 for the remaining amount in the Peace Officers Mental Health grant awarded in 2024. This request allows for continued mental health support services to be provided to Police Officers and Dispatchers in 2026. This request is offset with an increase in revenue appropriation.
• The Police Department is requesting supplemental appropriation in the General Fund of $130,808 for an amendment to the service agreement with Axon Enterprise which is used to purchase body-worn cameras, Tasers, and Evidence.com. The amendment was approved by Council in January 2026 to accommodate the staffing increases resulting from the passage of the 2024 Measure 2A.
Other Town funds and initiatives
• The Town Manager’s Office is requesting supplemental appropriation of $113,482 in the General Fund for the addition of a Risk Manager position. The FTE that previously supported risk management functions will remain allocated to the Town Attorney's Office but will be reclassified to support other legal needs.
• The Development Services Department is requesting supplemental appropriation of $135,106 in the General Fund to carryforward unspent grant funds and to fund additional grant expenditure needs in 2026 under the CDBG program. This request is off-set with an increase in revenue appropriation.
• The Finance Department is requesting to re-appropriate $390,500 in the General Fund for consultant services related to the procurement of the new Financial System.
• The Facilities Division is requesting to re-appropriate $79,762 in the General Long-Term Planning Fund technical services account for remediation efforts at Town Hall and 830 N. Wilcox St.
• The Public Works Department is requesting to re-appropriate $50,000 in the General Long-Term Planning Fund for repair and maintenance of Town owned parking lots. These funds went unspent in 2025 due to timing.
• The Division of Innovation and Technology is requesting to re-appropriate $289,195 in the General Fund for unspent IT Governance funds to be used for various town-wide web accessibility related costs.
• The Division of Innovation and Technology is requesting to re-appropriate $270,000 in the General Fund for unspent supply funds to be used for the replacement of Town servers and storage devices, and planned software purchases that due to time constraints were not able to be completed.
• The Division of Innovation and Technology is requesting to re-appropriate $66,000 in the General Fund for unspent technical services that are needed for fiber repair and other technical services to support the Town’s payroll system.
• Human Resources is requesting supplemental appropriation in the General Fund of $68,175 to fund the reclassifications of all HR employees to ensure fair and equitable compensation.
• Human Resources is requesting supplemental appropriation in the Employee Benefits Fund of $101,344 for the salary and benefits of a full time Benefits Specialist to help manage increasing benefits administration workload and ensure timely support for employees.
The additional amount of expenditure appropriation requested in this amendment are shown below and are grouped by Town fund.
|
|
Supplement Requests |
|
General Fund |
$ 1,653,996 |
|
TABOR Fund |
$ 312,513 |
|
Transportation Fund |
$ 1,807,729 |
|
Fire Capital Fund |
$ 355,190 |
|
Transportation Capital Fund |
$ 1,200,000 |
|
General Long-Term Planning Fund |
$ 247,284 |
|
Water Fund |
$ 323,856 |
|
Water Resources Fund |
$ 352,246 |
|
Stormwater Fund |
$ 10,500 |
|
Wastewater Fund |
$ 318,856 |
|
Employee Benefits Fund |
$ 101,344 |
|
Fleet Services Fund |
$ 3,926,430 |
|
TOTAL: |
$ 10,609,944 |
Budget Impact
As presented in Attachment C, the Finance Department has ensured that funding is available through either revenues and/or fund balance for requested items, maintaining adequate reserves within each fund.
Staff Recommendation
Staff recommends that Town Council approve the Ordinance as written.
Proposed Motion
“I move to approve on the Ordinance as introduced by title, on first reading.”
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).”
Attachments
Attachment A: Ordinance
Attachment B: Requests for Supplemental Appropriation
Attachment C: Estimated Ending Funds Available for 2026