Murfreesboro City Council approves FY27 Budget with no Property Tax Hike

The Murfreesboro City Council Thursday (June 4) approved the $782 million FY27 Budget on second reading that maintains the City’s strong financial position, supports continued growth, and advances City Council’s priorities without increasing the property tax.

“This budget supports the priorities our residents care about most — safe neighborhoods, better roads, strong schools, and a vibrant local economy, said Mayor Shane McFarland. I appreciate the hard work of our staff and City Council in developing a plan that meets today’s needs while preparing for tomorrow’s opportunities with high-quality services for our residents.”

The FY27 budget was developed under the Council’s community-based priorities: responsible budgeting, public safety, infrastructure expansion, economic development, and strengthening the City’s brand identity. According to the budget message prepared by City Manager Darren Gore and Chief Financial Officer Erin Tucker, “continued community growth will further demand for City services,” and the City remains committed to delivering those services cost‑effectively.

Balanced Budget

The FY27 Operating Budget is balanced and does not rely on the City’s unassigned fund balance for ongoing operations. The County’s 4-year reappraisal process is underway and a new certified tax rate has not yet been provided. However, the City does not anticipate a property tax rate increase for FY27 and has approved an ordinance stating Council’s intent to adopt the certified tax rate once it becomes available. (See “Next Steps” below). General Fund revenues are projected at $299 million, an 8% increase over FY26, driven primarily by sales tax growth.

The City’s unassigned fund balance is projected at $115 million entering FY27, including $60–85 million in operating reserves required by City financial policies.

“Public safety remains our largest investment, with funding for additional police officers, fire personnel, and critical equipment to support a proactive, data‑driven approach to keeping our community safe,” said City Manager Darren Gore. “At the same time, we are advancing major infrastructure projects, improving compensation to retain a skilled workforce, and moving Solid Waste closer to a self‑sustaining utility model.”

The budget prioritizes spending on four priorities established by City Council: 1) Maintaining Public Safety, 2) Responsible Budgeting, 3) Expanding Infrastructure 4) and Improving Economic Development.

Public Safety Remains Top Priority

Public safety continues to be the City’s largest operational investment. The FY27 budget includes:

• 18 new sworn police officers and five civilian positions, totaling $2.4 million
• Funding for a Fire Rescue instructor
• Continued development of the real-time crime data center
• Progress toward CALEA accreditation for both Police and Emergency Communications
• Planning for a future police precinct west of I‑24
• Delivery of the first of three new Pierce 107’ ladder trucks for Fire Rescue
• Construction of Fire Station 12

These following adjustments to pay and benefits are intended to increase recruitment and retention, following significant compensation improvements in FY25.

The FY27 budget includes:

• 6% pay increase for full‑time employees
• $6.5 million in salary adjustments
• $3.9 million for 32 new positions
• $670,000 increase in health care contributions
• $547,000 increase in pension contributions

The City recognizes that prior turnover‑related payroll savings known as “slippage” have “nearly been eliminated” due to improved retention.

Solid Waste Fee Adjustment Continues Multi‑Year Plan

FY27 marks the third year of the City’s eight‑year plan to transition Solid Waste into a self‑sustaining utility. The approved budget includes:

• Residential fee increases $2.00 from $13.50 to $15.50 per month
• Commercial fee increases $5.00 from $45 to $50 per can

In the future, with the closing of Middle Point Landfill, the added cost of a tipping fee, transfer stations, and recycling could be included in the full cost of Solid Waste collection. The City’s internalization of brush and limb pickup continues to save approximately $1 millionannually, reducing the General Fund impact by $500,000 compared to FY26.

Infrastructure and Capital Investments

The FY27 budget includes $132 million in capital expenditures funded through grants, fund balance, and current revenues. Major projects include:

• $14.4 million in road projects reimbursable by state and federal grants
• $17 million for Town Creek stormwater improvements for daylighting the stream that runs from the wetlands at Discover Center to Cannonsburgh Village
• $39 million in roadway improvements funded by MED sale proceeds
• Continued construction of Veterans Park, expected to open in late FY26 or early FY27
• $620,000 in transit projects, including new bus shelter design
• $3.8 million for new vehicles, including $2.5 million for Murfreesboro Police

The City’s roadway maintenance and construction budget totals $71 million, supplemented by an additional $75 million in CIP funding.

Economic Development and City Branding

The FY27 budget supports long‑range planning, zoning enforcement, airport improvements, and tourism initiatives. The City continues to work with the Chamber of Commerce to expand economic development opportunities and strengthen Murfreesboro’s brand as a desirable place to live, work, and invest. Maintaining the City’s award-winning park and greenway system that supports a high quality of life and enhancing tourism efforts in conjunction with the Chamber reflect the importance of the City brand.

ARPA Funds and One‑Time Investments

Of the City’s original $24.1 million in American Rescue Plan Act funds, just over $3 million will carry forward into FY27. Approximately $5.4 million in one‑time capital and extraordinary items will be funded from reserves, consistent with City policy.

“I am proud of the collaboration across all departments in preparing this budget,” added Gore. “Their dedication ensures that Murfreesboro continues to deliver high‑quality services in a cost‑effective manner while planning responsibly for the future.”

Next Steps

With Council approval, City staff will continue monitoring revenues and expenditures throughout the fiscal year and provide regular financial updates to Council.

Property taxes are approximately 26% of total general fund revenue. The current property tax rate is $0.9526 for each $100 in assessed value. The Rutherford County Property Assessor evaluates real property and tangible personal property for tax purposes. The next reassessment is currently in process. After completing the property reassessment, the certified tax rate is calculated, which is the tax rate on the new total assessment that would produce an equal amount of property tax levy as the preceding year. The City has not yet received the new property tax rate as recalculated with the reassessment. The new total assessment excludes properties being added to the tax roll for the first time in the reassessment year for the purposes of determining the new certified rate.

The City has won 16 consecutive Distinguished Budget Presentation Awards from the Government Finance Officers Association (GFOA). This is a companion to the award the City has earned for 23 years for its Annual Comprehensive Financial Report (ACFR) also known as the annual audit.