Staff recommends that the City Council conduct a public hearing and approve the proposed resolution setting annual street maintenance district assessments for FY27.

Street Maintenance District (SMD) assessments are established annually to fund essential roadway maintenance activities, including snow removal, street sweeping, pavement preservation, traffic signal maintenance, and gravel street maintenance. Current funding levels are insufficient to maintain existing service standards and support the approved 5-year Capital Improvement Plan.

Staff is proposing a 6.1% increase for SMD 2 and no increase for SMD 1 for FY27. If approved, the assessments are expected to generate approximately $19 million in revenue, and the average 9,691 square foot residential lot in SMD 2 would increase by $13.19 annually to $229.44. Staff recommends the City Council conduct a public hearing and approve the proposed FY27 SMD assessments.

Street Maintenance District (SMD) assessments are established annually by resolution. Billings currently operates two SMDs:

• SMD 1: Primarily encompasses the downtown area.
• SMD 2: Encompasses the entire city; properties in SMD 1 are also included in SMD 2.

These districts fund essential road maintenance and repair activities, including dust control and grading of gravel streets, chip sealing and overlaying, sweeping, snow plowing and removal, maintenance of traffic signal systems and signs, and pavement markings. Current funding levels are insufficient to maintain the existing service standards and support the approved 5-year Capital Improvement Plan, which includes significant infrastructure projects such as street reconstructions and traffic signal installations.  Staff is proposing an increase of 6.1% for SMD 2 and no increase for SMD 1 to maintain the current service level in FY27.

Street Maintenance District assessments generate approximately $19M of revenue.  If the proposed Resolution is approved, an average 9,691 square foot residential lot in SMD2 will be assessed $229.44 annually, an increase of $13.19.  

City Council must hold a public hearing and then may:

• Approve the recommended resolution,
• Approve an amended resolution, or:
• Not approve the resolution.  If Council does not approve a resolution, an amended resolution to establish street maintenance district assessments will need to be considered at a future City Council meeting to be in accordance with state statutes.