Litchfield Previews FY 2027 Budget Featuring $19.5 Million in Capital Projects and Fund Consolidations

Litchfield City Council Meeting | April 2, 2026

Article Summary: City officials presented the proposed Fiscal Year 2027 budget, highlighting a robust general fund, significant capital expenditures including new maintenance sheds, and the streamlining of city accounting practices.

Litchfield FY 2027 Budget Key Points:

• The General Fund balance is projected at a highly healthy 62.5% of operating expenditures for FY 2027.

• The city plans $19.5 million in total capital spending, including a $750,000 street project on North Monroe and a $794,000 fire tanker.

• The Police Department budget reflects an apparent jump to $3.3 million, largely due to properly incorporating $500,000 in pension costs directly into the department’s budget line.

• Several funds, including the Sales Tax and Grants funds, will be closed and rolled into the General Fund for cleaner auditing and transparency.

The Litchfield City Council on Thursday, April 2, 2026, held a comprehensive workshop to review the proposed Fiscal Year 2027 budget, detailing a robust $19.5 million capital improvement plan and sweeping updates to the city’s fund structures.

Ann Marie, the city’s finance consultant, guided the council through the financial blueprints, noting that the city recently received an “unqualified opinion”—the highest standard of clean financial statements—on its FY 2025 audit from Sikich CPA LLC.

The city’s General Fund remains in excellent shape, ending FY 2026 at roughly 79% of recurring operating expenditures, well above the council’s minimum requirements. Moving into FY 2027, the budget takes a highly conservative approach to revenue estimates while planning for $2.9 million in General Fund capital outlays.

To streamline accounting, the city will close several standalone funds, including the Sales Tax Fund, the Grants Fund, and the Long-Term Economic Development Fund, folding their revenues and expenditures directly into the General Fund and relevant departmental budgets.

“Sales tax really is a general revenue source and it really does belong in your general fund supporting general operations,” Ann Marie explained. “It makes for a much cleaner, easier audit the less funds that you have.”

The overall capital program for 2027 is historically large at $19.5 million. Major departmental highlights discussed during the workshop included:

• Street Department: The budget sets aside $750,000 to overhaul streets in a cul-de-sac subdivision on North Monroe, addressing an ongoing issue that has plagued residents for years. The city also plans to secure a $1.4 million loan to build a new street maintenance shed. “Currently two of our sheds down there are outmoded and they have dirt floors,” staff noted, explaining that the new controlled environment will prolong the life of expensive city equipment.

• Fire Department: A $794,000 pumper-tanker truck, ordered in 2024, is expected to be delivered by December.

• Police Department: The police budget shows an increase to $3.3 million, up from $1.7 million in 2024. Finance officials clarified that this jump is largely an accounting correction; approximately $500,000 in pension costs previously recorded elsewhere are now accurately reflected in the police budget. Additional increases stem from a wave of recent retirements, the purchase of a new K9 and associated training, and $231,000 in scheduled vehicle purchases. The city will also hire an officer to restore the School Resource Officer (SRO) position to full-time status in partnership with the school district.

• Lake Operations: The lake fund continues to operate at a loss due to weather dependencies and a massive recent investment in a $300,000 campground expansion. The expansion is expected to be completed by the end of next season, which officials believe will enhance visitor experiences, increase overnight stays, and generate new, stabilizing revenue. The city is also proposing a three-year plan at $100,000 annually to replace aging roofs on lake structures.

• Economic Development: TIF District #1 continues to be a financial engine, generating approximately $1.4 million in increment per year, leaving the city with about $980,000 annually after sharing 30% with overlapping taxing bodies.

The budget is currently available for public review on the city’s website under the transparency portal. The council is scheduled to hold a formal public hearing and cast a final vote on the FY 2027 budget at its April 16 meeting.