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Home My WebLink AboutFY 2025-26 Mid-Year Financial Update PPT CM editsFY 2025/26 Mid-Year Financial Update March 18, 2026 Eric Levitt, City Manager Tanya Romo, Deputy City Manager Jeannie Fortune, Deputy Director of Finance & Management Services Zuyva Ruiz, Budget Division Manager FY 2025/26 Mid-Year Report Agenda 2 •Executive Summary •City Revenue & Expenditure Trends •Mid-Year Budget Amendments •Fund Balance •Proposed FY 2026/27 Budget Activity EXECUTIVE SUMMARY 3 What’s Changed Since the Adopted Budget? 4 Category FY 2025/26 Adopted Budget FY 2025/26 Projected Year-End Variance Beginning Fund Balance $178.5M $178.5M $ - Revenues $228.2M $222.1M ($6.1M) Expenditures $257.5M $247.3M ($10.2M) Less: Nonspendable $41.0M $40.0M Ending Fund Balance (Estimated) $108.2M $113.3M REVENUE & EXPENDITURE TRENDS 5 FY 2025/26 Revenue Trends 6 Revenue Category FY 2023/24 Actuals FY 2024/25 Actuals FY 2025/26 Adopted FY 2025/26 Amended FY 2025/26 YTD Actuals as of 2/28/26 FY 2025/26 Projected Year-End Total Charges for services 6,829,807$ 6,184,405$ 5,822,130$ 5,822,130$ 3,879,348$ 6,728,670$ Fines and forfeitures 766,079$ 1,211,377$ 891,000$ 891,000$ 822,656$ 2,145,409$ Franchise Tax 14,328,378$ 13,908,285$ 14,560,000$ 14,560,000$ 5,105,629$ 14,546,664$ Intergovernmental 6,753,174$ 5,602,977$ 5,018,400$ 5,580,900$ 3,115,088$ 6,056,240$ Investment income 3,373,049$ 3,166,512$ 1,050,000$ 1,050,000$ 1,355,769$ 3,716,834$ Licenses & permits 16,059,891$ 14,575,494$ 14,287,000$ 14,287,000$ 9,006,301$ 14,171,910$ Miscellaneous 7,737,893$ 4,980,145$ 7,411,797$ 7,436,797$ 5,048,687$ 3,983,285$ Other Taxes 12,409,515$ 11,601,877$ 11,780,000$ 11,780,000$ 5,890,688$ 11,222,569$ Property Taxes in Lieu of VLF 23,604,046$ 25,443,736$ 25,149,250$ 25,149,250$ 13,438,797$ 25,198,138$ Sales and Use Tax 55,612,168$ 52,367,619$ 52,058,494$ 52,058,494$ 23,069,770$ 50,535,897$ Taxes 5,439$ -$ -$ -$ -$ -$ Use of Money and Property 5,273,844$ 6,184,183$ 6,383,760$ 6,383,760$ 1,278,293$ 4,282,347$ Utility Users Tax 28,671,310$ 29,146,952$ 31,740,980$ 31,740,980$ 17,679,325$ 27,650,246$ Measure S Sales Tax 51,214,630$ 51,617,498$ 52,040,000$ 52,040,000$ 20,486,319$ 51,821,000$ General Fund Revenue Total 232,639,223$ 225,991,060$ 228,192,811$ 228,780,311$ 110,176,671$ 222,059,209$ FY 2025/26 Expenditures Trends 7 Department FY 2023/24 Actuals FY 2024/25 Actuals FY 2025/26 Adopted FY 2025/26 Amended FY 2025/26 YTD Actuals as of 2/28/26 FY 2025/26 Projected Year-End Total Mayor 279,481$ 312,597$ 328,273$ 328,273$ 210,231$ 319,314$ City Council 1,061,509$ 1,144,563$ 1,191,224$ 1,191,224$ 786,705$ 1,140,481$ City Clerk 1,391,383$ 1,610,719$ 1,928,538$ 1,928,538$ 1,028,209$ 1,609,220$ Legal Services 4,795,033$ 5,821,618$ 5,197,318$ 5,197,318$ 2,300,837$ 4,477,142$ General Government 19,370,893$ 33,959,304$ 19,099,803$ 20,519,803$ 15,283,783$ 20,519,803$ Non Departmental -$ -$ (8,107,624)$ (8,107,624)$ -$ -$ City Manager 3,424,979$ 3,065,051$ 3,589,935$ 3,589,935$ 1,932,692$ 2,909,244$ Human Resource & Risk Management 2,390,082$ 2,579,595$ 2,881,727$ 3,095,970$ 1,929,803$ 2,996,576$ Finance & Management Services 5,044,637$ 6,119,022$ 7,187,643$ 7,187,643$ 4,207,865$ 6,692,211$ Economic Development 237,278$ 1,991,184$ 2,900,814$ 2,900,814$ 1,204,851$ 1,882,759$ Special Assessment District 114,321$ 145,653$ 175,000$ 175,000$ 146,120$ 175,000$ Capital Improvement Projects 320,505$ 1,652,555$ -$ 2,907,924$ 1,832,859$ 2,730,402$ Community Development & Housing 9,341,981$ 10,874,847$ 14,866,073$ 15,984,758$ 7,613,795$ 12,350,385$ Police 114,096,196$ 128,564,838$ 136,646,578$ 139,127,468$ 98,216,590$ 139,069,203$ Parks, Recreation & Community 5,109,685$ 5,284,718$ 6,091,320$ 6,489,999$ 3,951,626$ 5,954,159$ Public Works 26,606,218$ 30,531,908$ 16,859,309$ 17,103,914$ 9,740,632$ 14,884,793$ Operations and Maintenance (O&M)-$ -$ 17,821,891$ 17,695,640$ 9,473,579$ 14,499,309$ Library 2,601,058$ 4,714,510$ 5,088,922$ 5,113,922$ 3,125,580$ 4,750,324$ General Operating Expenditures 196,185,240$ 238,372,682$ 233,746,745$ 242,430,518$ 162,985,757$ 236,960,325$ Capital Improvement Projects 7,314,997$ 9,412,429$ 23,775,000$ 42,963,925$ 2,840,146$ 10,353,672$ Parks, Recreation & Community -$ -$ -$ 8,500$ -$ -$ Public Works -$ 2,520,051$ -$ 129,949$ -$ -$ Operations and Maintenance (O&M)-$ -$ -$ 189,750$ -$ -$ Measure S Expenditures 7,314,997$ 11,932,480$ 23,775,000$ 43,292,125$ 2,840,146$ 10,353,672$ GENERAL FUND TOTAL EXPENDITURE 203,500,237$ 250,305,162$ 257,521,745$ 285,722,643$ 165,825,903$ 247,313,997$ MID-YEAR BUDGET AMENDMENTS 8 Human Resources Department Amendment Tuition reimbursement ensures employees with pending requests are funded. Contractual obligations supported through June 30, 2026. Outside legal costs are appropriately funded through the Liability Insurance Fund. 9 Request Amount Recommended Funding Source Tuition Reimbursement $7,807 General Fund Contractual Services $27,684 General Fund Outside Legal – Litigations & Investigations $350,000 Liability Insurance Fund Total:$385,491 Legal Services Department Amendment BB&K Retainer: CPI adjustment effective July 2025. Contractual Services: Outside Attorneys & Document Management Costs. 10 Request Amount Recommended Funding Source BB&K Retainer Increase $63,424 General Fund Contractual Services $252,163 General Fund Total:$315,588 General Fund Police Department Amendment Specialized equipment supports high-risk operational response capabilities. Better alignment in administrative staffing to current operational demands – removing 2 Accounting Technicians & adding 1 Management Analyst II. 11 Request Amount Recommended Funding Source Robotic Dog $200,000 Asset Forfeiture - State Personnel Restructuring Cost Neutral General Fund Total:$200,000 Non-General Fund Parks & Recreation Department Amendment Year-round aquatics programming and grant expiration of part-time staffing is driving part-time shortfall. Facility operational readiness investments. 12 Request Amount Recommended Funding Source Part-Time Salaries $134,825 General Fund Pool Pump Replacement $35,000 General Fund Community Center Outdoor Lighting $15,000 General Fund Total:$184,825 General Fund Mid-Year Budget Amendment Summary 13 Department General Fund Non-General Fund Total Human Resources $35,491 $350,000 $385,491 Legal Services $315,588 -$315,588 Police -$200,000 $200,000 Parks & Recreation $184,825 -$184,825 Total $535,904 $550,000 $1,085,904 FY 2025/26 PROJECTED FUND BALANCE 14 Fund Balance Summary 15 Category FY 2022/23 Actuals (audited) FY 2023/24 Actuals (audited) FY 2024/25 Actuals (audited) FY 2025/26 Adopted Budget FY 2025/26 Year-End Estimated Beginning Fund Balance, as of June 30th 156,449,095$ 173,462,555$ 202,925,562$ 178,515,774$ 178,515,774$ Revenues 221,320,505$ 233,643,492$ 228,011,214$ 228,192,811$ 222,059,209$ Expenditures (Operating Only)(190,984,572)$ (196,185,240)$ (239,687,480)$ (233,746,740)$ (239,690,727)$ Expenditures (CIP Only)(13,322,473)$ (7,995,245)$ (12,733,522)$ (23,775,000)$ (7,623,270)$ Net Surplus/Deficit - (Use of Fund Balance)17,013,460$ 29,463,007$ (24,409,788)$ (29,328,929)$ (25,254,788)$ CIP Fund Balance Use 23,775,000$ 13,084,074$ Operations Fund Balance Use 5,553,929$ 5,553,929$ Carryovers from FY 24/25 Fund Balance Use -$ 6,616,785$ Fund Balance 173,462,555$ 202,925,562$ 178,515,774$ 149,186,845$ 153,260,986$ Less: Nonspendable 41,421,536$ 40,806,497$ 39,593,408$ 41,000,000$ 40,000,000$ Ending Fund Balance 132,041,019$ 162,119,065$ 138,922,366$ 108,186,845$ 113,260,986$ PROPOSED FY 2026/27 BUDGET ACTIVITY 16 Proposed 2026/27 Budget Activity 17 •Budget Workshop: April 29, 2026 •Anticipated Budget Hearing & Adoption: June 17, 2026 Questions 18