Mexico’s budget for fiscal year 2027 will fund a number of citywide improvements ranging from streets to pickleball courts.

The Mexico City Council approved a balanced $25.5 million budget for fiscal year 2027 at its Sept. 11 meeting. The budget includes street and sidewalk improvements, wastewater projects, downtown revitalization efforts, the hospital demolition, salary increases for city employees and construction planning of a new City Hall and Public Safety Facility.

Budgeted expenditures are estimated at $25,531,806 and total revenues are estimated at $20,995,517. Expenditures are expected to exceed revenues by about $4.5 million and the difference will be funded by project reserves, unreserved surpluses for prior years’ budgets, grants and interfund transfers.

“Additional expenditures are for planned capital equipment purchases, planned capital improvement projects, project reserves and carryover improvement projects,” City Manager Bruce Slagle told council.

Budget highlights

General Fund expenditures are estimated at $8,424,492 — $739,000 in nonrecurring capital expenditures, a transfer of $65,000 to the Airport Fund and a $100,000 set-aside in project reserves. Budgeted items from this fund include equipment for the public safety, community development, engineering, stormwater, forestry, cemetery, streets and maintenance departments. Revenue is estimated at $7,593,368.

Wastewater Operation Fund expenditures are estimated at $4,275,961 — $3,421,711 in operating expenditures, an interfund transfer of $774,250 to the Wastewater Debt Service Fund and a project reserve of $80,000. The budget’s $1,130,500 in planned capital improvement projects for this fiscal year will address wastewater treatment plant upgrades and improvements to buildings and the collection system.

Sanitation Operation Fund expenditures are estimated at $878,906 — $867,906 in operating expenditures and an $11,000 project reserve for equipment replacement. This fund supports residential refuse collection, spring and fall cleanups, and recycling and household hazardous waste disposal. The budget also includes a 2.4% annual market-rate rate adjustment to the base sanitation rate that will be effective in April 2027.

Economic Development Fund expenditures are estimated at $1,247,735, with revenues estimated at $220,620. This includes the city’s portion of the Audrain Medical Center demolition projects, maintenance of city-owned buildings and railroad spur repairs. 

Parks and Recreation Fund expenditures are estimated at $2,032,030, with revenues estimated at $1,736,541. The budget reflects a $295,489 reduction in cash balance due to planned and carryover capital projects and equipment purchases. Planned projects in fiscal year 2027 include the construction of two new pickleball courts at Fairgrounds Park, trailer repairs at Lakeview Park, parking lot repairs at Tyronn Lue Park, the purchase of a compact wheel loader and the replacement of pool furniture and equipment. 

Public Health Fund expenditures are estimated at $519,546, with revenues estimated to be $419,028. The fund supports the dangerous building demolition program and nuisance abatements. According to the budget statement provided by Slagle, the city also plans to use some of the designated estate donation funds for flooring improvements at the animal shelter.

Capital improvement sales tax and investment revenue for this fund is estimated at $1,198,279. Upcoming projects and program expenditures supported by this fund include pavement maintenance, sidewalk improvements, pavement and curb replacement, the Smiley Lane extension and project reserves.

Capital Project Reserve/Use Tax Fund expenditures are estimated at $2,135,833, with revenues estimated at $883,207. The expenditures include an interfund transfer to Parks and Recreation to support a portion of the Fairground Aquatic Center loan and a $2 million transfer to support costs associated with the design of the City Hall and Public Safety facilities.

External funding and revenues

The city budgeted $91,400 to support charitable and contract organizations. Charitable organizations include the Mexico Activity and Nutrition Center, $14,000; Audrain County Historical Society, $7,400; Miss Missouri Scholarship Organization, $10,000; The Help Center, $7,500; Mexico Optimist Youth Sports, $7,500; and Audrain County Shelter Resource Coalition, $5,000. Contract organizations include The Handi-Shop Recycling Program, $12,000; marketing for the Mexico Area Chamber of Commerce, $13,000; Presser Arts Center community theater, $10,000; and Mexico Area Chamber of Commerce economic development, $5,000.

Other grants included in the budget are $75,000 from the Missouri State Parks Foundation to build new pickleball courts, $135,000 from the Department of Transportation for airport runway repairs, $567,962 from the Missouri Department of Transportation Transportation Alternatives Program for phases 3 and 4 of sidewalk improvements, and a $393,411 pass-through grant funded by the Missouri Developmental Finance Board for the Handi-Shop.

According to the budget statement, the city of Mexico is experiencing modest growth, a trend that is expected to continue, and is “well positioned” moving into fiscal year 2027. The biggest difference between this fiscal year and last year is timing due to the One Big Beautiful Bill Act, which will begin phasing in this fiscal year.

“States are continuing to navigate a much higher, tighter, fiscal environment due to the big beautiful bill,” Slagle said. “Nearly half the states are already implementing some form of spending restraints.” 

He added that every project that depends on federal, or state grant reimbursement or matching funds in this year’s budget will be flagged and monitored for any delays in funding.