Jackson Council outlines 25–45% General Fund reserve guardrails for FY27

Jackson Town Council used its March 18 special workshop to review a refined “strategic budgeting” philosophy that staff say is intended to guide consistent, long- and short-term fiscal decisions without binding future councils. The philosophy defines a “healthy budget” as (1) maintaining a healthy General Fund balance, (2) balancing annual revenues and expenses, and (3) balancing the growth rate of recurring revenues and expenses. Staff’s timeline shows the budget philosophy and action plan targeted for adoption “by May 2026.”

A centerpiece of the draft framework is an “acceptable range” for the General Fund balance of 25% to 45% of budgeted expenses. The 25% level is presented as an emergency-use “floor” (a reserve meant to cover an unexpected revenue drop), while 45% is presented as a “ceiling” intended to prompt spending down excess reserves when a near-term plan exists.

The presentation also lays out how staff propose to use the reserve target annually in the budget process: choose a target within the 25%–45% range early in the cycle; apply that target to the fiscal-year starting balance and projected revenue to determine an “expense limit;” then use that limit to evaluate department budget requests as the council adopts the budget. The workshop packet frames the Town’s current modeling as a “3–4 year reserve horizon,” suggesting reserves could fall below the 25% target in two to four years without changes. (Special Town Council Workshop Agenda Packet)