City finance staff and department directors presented an overview of Santa Paula’s proposed two‑year budget, telling the council that the near‑term revenue outlook is conservative and that many year‑two increases rely on one‑time development receipts.

Finance staff (Ms. Ramirez) explained the budget’s revenue assumptions and why staff treated significant plan‑check and other development fees as one‑time receipts in 2025–26. “The budget is one of two things, it is based on historical information, and based on what the needs, or in this case, the revenue is gonna be, in the next budget cycle,” Ms. Ramirez said, adding the city expects to maintain Measure T sales tax at about $4.5 million and to profile a modest 2% increase in year two.

Staff highlighted several expenditure pressures: rising general liability insurance, legal expense volatility and the cost of CalPERS unfunded accrued liability (UAL). The presentation recommended setting aside monies for cost‑of‑living adjustments and a phased approach to closing a compensation gap identified in a recent pay study; staff proposed moving about halfway toward market parity over two years rather than attempting full adjustment immediately.

Departments requested new one‑time capital equipment to expand in‑house capacity and reduce contractor reliance. Public works requested a range of items the department said would permit more internal pavement and repair work: a heated pressure washer, compressor, crack‑seal maintenance trailer, thermoplastic application equipment for durable crosswalk and marking work, a smaller dump truck suitable for in‑house crews, and a trailer‑mounted hydro‑excavator used to safely dig around underground utilities. Public works staff explained these were intended as targeted, first‑stage purchases rather than large heavy‑fleet acquisitions.

The budget workshop also included technology and operations items: a permit and code‑management software initiative (staff estimated about $40,000 per year depending on implementation and vendor), website and “see‑click‑fix” style citizen request tools (budgeted about $15,000 per year), and a modest allocation for AI‑assisted internal research and customer‑facing tools (estimated $5,000–$15,000 per year depending on vendor). Staff said these investments aim to increase responsiveness and reduce manual back‑office workload.

On personnel, staff proposed phasing several position changes: add a human resources support technician in year two; temporary/part‑time help for the city clerk’s office in year one; unfreeze an associate planner in community development; create a parks facility maintenance lead (promotion opportunity rather than net new body); and add one street maintenance worker in year two subject to equipment purchases and operational needs. Water operations requested one additional water system operator in each of the two years to keep pace with new development and system growth. Police requested an administrative analyst in lieu of refilling an administrative sergeant slot; staffing adjustments were tied to operational needs and pending labor negotiations.

Staff emphasized that the roughly $1.2 million projected surplus in year two mainly reflects anticipated one‑time development fees; staff recommended the council treat that as contingent revenue and direct it toward unfunded CIP needs only if receipts materialize. Council members asked for clearer breakdowns of salary‑to‑benefit components for proposed positions and requested additional detail on vendor choices for web, permitting and AI tools before authorization.