Are utility budgets subject to the appropriations cap?

Utility budgets are typically exempt from the appropriations cap. This is primarily because utility budgets are derived from user fees and charges rather than general tax revenues. Since they do not directly impact the overall tax levy and are often tied to the operation costs of providing services such as water, electricity, or sewage, they operate under a different framework.

This exemption allows municipalities to manage their utility services without restrictions that might apply to other budget areas, ensuring they can adequately fund necessary infrastructure and services based on demand and operational costs. By being exempt, utilities can function and adjust autonomously to changes in costs, regulations, and consumer needs without the constraints of overarching fiscal limitations imposed on general fund appropriations.