Good evening.

I now call to order the Wednesday, October 7th, 2026 meeting of the Appleton Common Council.

Please rise for the invocation, which will be delivered by Elder Meltzer.

The Autumn Moon Festival was on September 25th this year.

This is a very important festival to Chinese people, second only to the New Year festival.

This experience gave me deep insight into what it is to be an outsider, to know the difficulty and loneliness of seeking belonging in a new community with a different language and customs than

my own.

After seven years in China, I experienced it all again when I returned to the United States and was once again in an unfamiliar community where I had no roots or connections.

Poetry is an important part of celebrating the Autumn Moon Festival.

And one of the most famous poems about this festival speaks poignantly to the themes of loneliness and isolation.

Looking down, I miss my childhood home.

Uh seeing none, uh, we will we will just make note of that.

Uh it is Disautonomia Awareness Month, as it is also domestic violence awareness month, Diwali Awareness Month coming out day is being uh recognized in October, White Cane Awareness Day, Mental Health Day, Indigenous People's Day, and National Teen Driver Safety Week all being recognized this month.

All right, on to uh 26-1249, the 2027 executive budget and service plan.

Uh under ordinary circumstances, I'd be presenting the executive budget and service plan to you this evening.

Uh,

right up front, I just want to say I will not be presenting the budget tonight.

Final validation, the final validation process for the executive budget is not yet complete,

and

I don't want to present numbers that may yet be provisional.

Along these same lines, we will not be distributing the budget document yet either.

For some context, finance director leadership, the finance director leadership transition occurred in the spring in the midst of the audit process.

Due to the timing, Director Mezerschmidt had to devote significant time and energy to the audit rather than her full attention to the budget, which was our intent and our intention.

The audit process was significantly delayed, as much of the documentation required was tabulated in spreadsheets and workbooks, some of them likely decades old.

To be absolutely clear, the systems the City of Appleton has relied on for decades were sound, and our stewardship of the community's resources has been reliable.

This has been validated time and again by external audits and ratings and by effective administration of adopted budgets and the common council's oversight.

It was, however, a system that operated substantially on institutional knowledge.

And after the previous director's departure, what remained of that institutional knowledge was lost.

Director Messerschmidt has worked diligently to build up our system using modern tools, most importantly, our Tyler Munis ERP system to ensure accuracy of reporting.

This process has been extremely time-intensive, and unfortunately, due to the associated delays in providing the data that our auditors needed, we had to wait for our auditors to again have capacity to review and complete our audit.

As a result, the city of Appleton has missed the state filing deadline for our audit, and we anticipate an associated penalty, though this has not yet been confirmed.

As of now, our audit is pending and we expect to have it completed soon.

Unfortunately, many of the same challenges with underlying systems that delayed completion of the audit have hindered our final validation of the executive budget and service plan.

Departmental budgets and review meetings were submitted and held on schedule, and the budget itself is substantially complete.

However, Director Mezzerschmidt has advised me that we need to complete validation of the budgets in Tyler Munis to ensure accuracy.

And I fully support her recommendation and appreciate the integrity of her approach.

When

budget validation is completed, the budget document will be released to the council and made available to the community.

We

recognize the time is of the essence in this task, as you must have time to appropriately scrutinize the budget before considering adoption.

So as for what you can expect in the 2027 executive budget and service

plan.

Services and staffing levels will remain consistent with 2026.

This was a stated priority of the council and something that we share as a priority for our community, and we've worked to honor that in this budget.

We've again prioritized maintaining competitiveness in compensation and benefits with a 3% merit increase for non-represented employees and no substantial changes to benefits or premiums.

Net new construction did come in slightly lower than the previous year, which will reduce revenues.

Departments were asked to maintain steady funding levels on all discretionary budget lines and honored that instruction.

So in other words, the discretionary lines of the budget will remain consistent with previous years, wherever we have control over those lines.

We do expect that the general fund will roll up in deficit, something that we've talked about probably since last year when we we introduced last year's budget.

Uh, and we we do still expect that the budget will roll up uh in deficit initially.

Uh

while that final number is still being validated, we will be deploying part of the CEA funding uh shift uh that the council reviewed and supported earlier this summer to to close the gap and bring forward a balanced budget.

So that that will be in our plan as we discussed uh when the council took that up.

The plan will be to use some of the cash reserves that have been built up in the CEA fund, which will soften uh the impact on our general obligation debt.

But we will be deploying that mechanism to help close the expected deficit.

It is also possible that we will need to revisit fuel and energy expenses in the budget over the course of 2027, depending on where actual costs come out.

So just something to keep in mind when when we start looking at the budget.

Uh when we take up the budget now, or it's something that we opt to review over the course of the year against actual spend.

That's just something that I want to flag for the council as we get into the process.

But generally speaking, this budget will not have surprises in it.