San Jose accepts 2024–25 annual financial report and approves modest budget adjustments; housing legal services funding raised by public commenters

SAN JOSE, Calif. — The San Jose City Council accepted the City Manager’s annual financial report for fiscal year 2024–25 and approved a set of technical budget adjustments on Oct. 21, following a presentation by Budget Director Jim Shannon.

Shannon told council members the city closed FY 2024–25 with nominally positive results but only a small truly available general fund balance after carryforwards. ‘‘When you really look at the available fund balance after those cleanup and re‑budget actions, we've got only about $1.2 million of funds that are remaining,’’ Shannon said during his presentation.

The annual report described revenues and expenditures across about 140 funds and recommended several cleanups: transferring Measure E–related encumbrances back to the real property transfer tax fund, recognizing grants and reimbursements, and reducing a planned transfer to the emergency reserve from $10 million to $7 million because of improved federal reimbursements. The council approved the package, including the requested technical modifications to several capital and special funds, and directed staff to return ordinances and implementing language where required.

Public commenters used the annual‑report item to press the council on housing legal services funding. Representatives from the Law Foundation of Silicon Valley, Bay Area Legal Aid and Project Sentinel warned a pause that the city placed on legal‑services contract funding in late June had already limited services and forced vulnerable tenants to be turned away. ‘‘We ask this so that we can continue to provide critical housing services for tenants in the city of San Jose,’’ Cynthia Chagoya of the Law Foundation of Silicon Valley said during public comment.

City staff responded that much of the contract uncertainty stemmed from changes to federal funding sources and required additional legal and administrative review; the city indicated it expected to move forward with executing grant agreements and contracts.

Councilmember Peter Ortiz also successfully moved a separate, district‑level amendment (a blue memo) shifting existing placemaking funds in his district to allow for public‑art or banner projects in Alum Rock Village; staff said the reallocation would preserve the original intent while allowing final design flexibility.

The council approved the annual report and associated budget adjustments unanimously. Ortiz moved the motion to approve the annual report and staff modifications plus his blue memo; the vote was recorded as unanimous.

Why it matters: The report highlights narrow financial margins going into the next budget cycle and identifies specific adjustments staff say are needed to comply with council policy while acknowledging limited room for new discretionary spending. It also made public a funding tension: recent administrative pauses on housing legal services prompted appeals from nonprofit providers who said the interruptions were already reducing tenant assistance that prevents homelessness.

Next steps: Staff will execute the recommended budget transfers, finalize any ordinance language for new special funds, and proceed with contract execution for eligible grant agreements. City staff also indicated they would continue coordinating with housing‑legal providers to resolve contract pauses and move forward with the eviction‑prevention and anti‑discrimination programs described by speakers.