To: Honorable Mayor and Members of Town Council
Through: David L. Corliss, Town Manager
From: Trish Muller, CPA, Finance Director
Title
Resolution Approving the 2026-2030 Balanced Financial Plan for the Town of Castle Rock
Body
________________________________________________________________________________
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 2026 with the development of the 2026-2030 Balanced Financial Plan.
The 2026-2030 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 $26.2 million of capital reserves for one-time capital projects, which is a common and sound financial practice.
The Proposed 2026 Budget estimates annual growth in sales tax revenue at 3%. Revenue from the Town’s general 4% sales tax is budgeted as follows in 2026: 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 2026 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 2026, 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 2026.
Personnel projections include a substantial increase in healthcare cost as well as an average 5% performance-based increase for general employees, and an average 7.5% increase for public safety personnel.
Overarching goals of the 2026-2030 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
2026 Budget Priorities
The 2026 Budget priorities used as the basis for development of the 2026-2030 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 2026 Budget process. These priorities are also supported in the 2025 community survey results as previously presented to Town Council.
Budget Impact
The 2026-2030 Balanced Financial Plan was developed using conservative and informed financial modeling and forecasting. Annual growth in sales tax revenue is included at 3% for 2026. Residential growth is expected to continue to slow over the five-year planning period and is budgeted at 300 single-family units and 110 multi-family units in 2026.
Financial Details
The 2026-2030 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 15 additional FTEs for 2026 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 2026, by fund and by department.
GENERAL FUND
Police Department:
• Add three Police positions - a traffic officer, a commander and a deputy chief
• Address additional needs of CRPD including $200,000 for the Drones Fires Responders program, Regional SWAT equipment, software improvements, two vehicles, as well as other needs
Fire Department:
• Add three Fire and Rescue positions: a firefighter/EMT, a fire prevention officer and an administrative assistant
• Address additional needs of CRFD including $175,000 for continued wildland mitigation and wildland protective equipment; two vehicles, hydraulic extrication tools, mechanical chest-compression (LUCAS) devices, training tower maintenance, as well as other needs
Parks & Recreation Department (various funds):
• Initial $2 million investment in the phased development to open portion of the Lost Canyon Open Space for public access
• Improvements at Red Hawk Ridge Golf Course, including parking lot repairs and maintenance equipment, funded by golf revenues
• Replacement of Recreation Center cardio exercise equipment and the Recreation Center sign
• Continue repairs and improvements at Cantril School, including west side masonry and window restoration and the first phase of outdoor improvements
• Add one Parks and Recreation Maintenance position
TRANSPORTATION & TRANSPORTATION CAPITAL FUND:
• As part of CDOT’s requirements for the interchange, the Proposed 2026 Budget includes funding for a park and ride lot to be constructed on Town-owned property near the Crystal Valley Interchange.
• Complete an aggressive Pavement Maintenance Program, focused in 2026 on northern Castle Rock, at an estimated 2026 cost of $19 million
• Design of intersection improvements at Mikelson and Enderud boulevards
• Traffic signal construction at Founders Parkway and Crimson Sky Drive, as well as at Founders Parkway and Avenida del Sol (subject to CDOT approval)
• Two new Street Maintenance Technicians will be added to the Public Works Department, assisting with road and right-of-way maintenance, snow plowing and other Public Works responsibilities
• Address additional needs of Public Works including one vehicle, additional funding for street marking work and necessary equipment, and enhanced pay for snow plow operations
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
• Continue progress in the long-term water plan on the WISE project, including planning and design on a desalination facility; and on the Chatfield Reallocation and Platte Valley Water Partnership projects
o Fund additional operational expenses associated with the ramp-up and doubling of the amount of WISE imported renewable water that Castle Rock will receive in 2026
• Construct the South Well Field Pipeline and upgrade filters at the Meadows and Miller water treatment plants
• Implement the U.S. Highway 85 sewer project using Douglas County American Rescue Plan Act funds
• Replace Castlewood Ranch lift station, the Plum Creek Water Reclamation Authority Reuse Reservoir, the pump station that serves Red Hawk Ridge Golf Course and the sewer system in Escavera
• Rebuild the Paintbrush Park pond, stabilize 6400 East Plum Creek, rehabilitate storm sewers based on the results of video inspections in central and Downtown Castle Rock and address additional stormwater infrastructure needs caused by development in Crystal Valley
• Add four positions - a plant maintenance supervisor, a SCADA supervisor, a water quality technician and a stormwater infrastructure inspector (split with Development Services)
CONCLUSION
The overarching goals of the 2026-2030 Balanced Financial Plan are providing healthy operating resources and capital projects in Town priority areas of transportation, water, parks, open spaces 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 2026-2030 Balanced Financial Plan demonstrates that the ongoing initiatives set forth within the 2026 Budget are sustainable and the one-time requests are able to be accommodated.
Staff Recommendation
Staff recommends that Council approve the 2026-2030 Balanced Financial Plan as presented.
Proposed Motion
“I move to approve a Resolution Approving the 2026-2030 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).
Attachments
Attachment A: Resolution
Attachment B: 2026-2030 Balanced Financial Plan