Fort Morgan freezes hiring, pauses projects as Cargill lockout strains budget
The city is restoring a proposed 15% general-fund reduction target and considering 3.5 full-time-equivalent cuts, but no staffing reductions or revised budget has been adopted.
Fort Morgan is freezing hiring and pausing unstarted capital projects after City Manager Brent Nation told the City Council Aug. 4 that the Cargill lockout had reached 75 days without production and could leave a roughly $15 million gap in the city’s nearly $100 million budget.
The labor dispute remained unresolved Aug. 5. Teamsters Local 455 members voted Aug. 3 to reject a tentative agreement to return to work, and The Fort Morgan Times reported that neither the union nor Cargill had committed to a new agreement. More than 1,700 Teamsters remained out of work, The Colorado Sun reported, citing union and stakeholder reporting rather than an independently confirmed city count. Cargill said it was evaluating next steps and remained open to proposals consistent with the economic framework previously discussed.
Nation said the effects were already appearing in 2026 utility sales and could spread to sales tax and other indirect revenue, according to the city’s July 7 council meeting summary. He warned layoffs or other reductions in force might be necessary if the plant did not reopen soon. The city has not released a fund-by-fund estimate of the shortfall.
At the Aug. 4 meeting, budget officials said they had restored a previously directed target of cutting general-fund departmental budgets by 15% after the tentative Cargill contract failed ratification. The first eight department presentations included Mayor and Council, the city manager, Finance, City Clerk, City Attorney, Airport, Human Resources and General Government. The proposal has not been adopted.
Officials said it could eliminate 3.5 full-time-equivalent positions — three full positions and a half-position tied to shifting part of an employee’s salary to a utility department. No reductions would become official until the general fund was balanced. General Government was described as facing a 36% reduction, largely because staff could move from the current council building to the city complex; the building would still be used for council meetings.
The airport budget could rise despite the general-fund target because its fixed-base-operator contract increased from about $36,000 to approximately $170,000 annually. Officials said the higher cost was needed to retain the airport’s general-aviation status. The city plans to present projected revenues after general-fund departments finish their presentations, followed by utility budgets. The council was expected to consider a revised budget calendar at its next meeting. It also authorized an Aug. 4 executive session on economic incentives and negotiation strategy; the substance was not disclosed.
Three residents asked the council to use its influence with Cargill to resume negotiations. One said, “I’m asking to use the influence that you do have,” arguing that better wages and benefits for about 1,700 workers would support local businesses and protect city revenue. The comments were stakeholder claims, and the council took no action on the requests, the meeting record shows.
The lockout began May 20, when workers arrived for shifts and found the plant closed, The Fort Morgan Times reported. The city’s revenue forecast, full 2027 budget and any staffing reductions remain pending.