Council will vote on proposals for spending FY25 Fund Balance dollars

This Tuesday, October 21st at 1pm, Council will hold a Committee of the Whole (COW) meeting to decide how to allocate the city’s fund balance from Fiscal Year 25 (FY25).

The fund balance is essentially leftover money from the previous budget year. The balance can come from several sources: more revenue or lower expenses than expected from the previous budget and money in the last budget that has not been spent yet.

While the majority of the city’s fund balance is pre-committed to certain expenses, there is typically an “unassigned” fund balance amount that Council can allocate to different programs or projects as they see fit.

The FY25 unassigned fund balance is just over $6.29 million. This is less than a third of the size of FY24 budget’s $20.4 million fund balance.

While Lexington continues to see revenue growth each year, that has slowed down steadily since 2022 and 2023 when growth was significantly higher than the city expected, often leading to higher unassigned fund balances than LFUCG has historically had.

• For more detail on how Lexington's revenue growth has slowed, and its impacts on FY26 and other future budgets, you can read this piece from February 2025 where we look at projected revenues for the city's largest revenue sources (the Payroll Withholding Tax and Net Profits Tax).

Individual Councilmembers have submitted recommendations for how to spend portions of the fund balance. These recommendations total $2.79 million. Those recommendations, and the Councilmembers making them, are:

• $50k to each Councilmember's Council Capital Fund ($750k total). Councilmembers can use these funds to support capital projects in Lexington, included new sidewalks, park improvements, or public art. (8th District Councilmember Amy Beasley)
• $700k to implement various recommendations from the STREEET Safety Task Force. (Vice Mayor Dan Wu; 3rd District Councilmember Hannah Legris; 4th District Councilmember Emma Curtis; 5th District Councilmeber Liz Sheehan; 9th District Councilmember Whitney Elliott Baxter; and 10th District Councilmember Dave Sevigny)
  • $365k to conduct a Roundabout Feasibility Study;
  • $50k for a Traffic Circle program;
  • $150k for a Crosswalk Signal Improvement Study;
  • $115k for increased street safety public engagement efforts;
  • $20k for a Signage Pilot in the Division Traffic Engineering.
  • You can read more about the STREEET Safety Task Force recommendations here. Not all of the recommendations have earned fund balance requests from these Councilmembers.
• $110k for pedestrian safety improvements at Bryan Avenue and Loudon Avenue. (1st District Councilmember Tyler Morton)
• $20k to pilot a Neighborhood Voices Project that would host listening sessions with neighborhood residents, create stipends to support community leadership projects, and resources to help neighbors complete community-building projects. The pilot would be conducted in the Smithtown neighborhood. (Councilmember Morton)
• $50k to support a newly created Boys and Girls Club chapter in Lexington. (Councilmember Morton)
• $20k for enhanced programming at the Black and Williams Center (Councilmember Morton)
• $475k to Lextran to implement a microtransit pilot project. (At-Large Councilmember Chuck Ellinger)
  • Council allocated $250k for the same project in the FY26 Budget earlier this year.
  • Lextran's Microtransit Feasibility Study estimates that operating a two-year pilot project would cost over $2 million. You can read more about microtransit here.
• $50k to A Caring Place to implement a village senior care pilot project. (2nd District Councilmember Shayla Lynch)
  • You can read more about A Caring Place here.
• $50k for new technical equipment for Code Enforcement staff. (Councilmember Lynch)
• $55k to remove 77 of the city's wayfinding signs. (Councilmember Baxter)
• $50k to the Office of Economic Development to support digital accessibility initiatives. (At-Large Councilmember James Brown)
• $460k for solar panel grants to low- and moderate-income households through the Solarize Lexington program. (Councilmember Sheehan)

If all of these recommendations were approved, there would be roughly $3.5 million left in unassigned fund balance money. Traditionally the Mayor's Office has made recommendations for the unassigned fund balance just as Council does, but the Mayor's Office has not submitted any recommendations this year.

CORRECTION: We originally wrote that one fund balance request was to remove roughly 200 wayfinding signs. Instead, the request was to remove 77 wayfinding signs.