Mayor Greg Fischer cited "rapid revenue growth and continued efficiencies" when announcing the surplus.
Gov. Eric Holcomb has said he is working on an inflation relief plan, which he expects to release early this month.
The leftover money could be used to help the homeless and provide more clean-up downtown.
Surplus milk will be sent to Feeding America food banks and other community organizations through the end of August.
That money could be used to give aid to laid-off workers and feed the hungry.
Not all council members were sold on the idea, which would divert some of the city's surplus funds.
The expected surplus could help the city dodge cuts in next year's budget.
The full council still has to approve the plan, which will be taken up for a vote at the next meeting on Dec. 12.
On Monday, 9th District Metro Councilman Bill Hollander will introduce a plan for the surplus.
Mayor Greg Fischer wants to use some of that money to move up the next Louisville Metro Police Department recruiting class.