Anaheim presents FY 2025–26 budget workshop as city warns of one-time fixes and revenue risks

City officials presented a proposed fiscal year 2025–26 budget at a June council workshop, telling the City Council the $2.4 billion citywide plan balances ongoing operations for the coming year but depends on one-time revenues, bond proceeds and reserve draws to close an operating gap.

The workshop, led by the City Manager and Finance Director Moreno, outlined operating sources of roughly $608 million and operating uses of about $672 million in the general fund, producing an operating deficit that the staff plans to cover in part with one-time items including remaining bond proceeds, proceeds from the sale of a hotel parking structure and reserve draws. “We present a balanced budget for your consideration. But we only got there by drawing on reserves, bond proceeds, and one-time revenues from the sale of Car Park 2,” Finance Director Moreno said in the presentation.

Why it matters: the plan sustains current service levels for police, fire, parks, libraries and utilities but includes risks that could increase deficits in later years. Staff emphasized the city’s heavy reliance on transient occupancy tax (TOT)—about 39% of general fund operating sources—and on resort-related transfer formulas that will decline as the city’s LPMR (resort-related) bonds are retired. Council members pressed on reserve policy, staffing costs and public engagement before the budget returns for further review and a public hearing.

Major revenue and expense points

- Total proposed citywide expenditures: about $2.4 billion; the general fund is approximately 22% of…