The San Luis City Council on May 28 approved the city’s tentative budget for fiscal year 2025–26, setting the city’s maximum spending limits and budget priorities for the coming year.

City finance director Roula Encina presented the plan, saying the total proposed expenditures across all funds are $143,178,500 and total revenues are estimated at about $139.1 million, producing an estimated shortfall of about $8.28 million that the city plans to cover using existing fund balances. The tentative budget includes roughly $52.1 million for capital projects and a personnel budget of about $35.5 million.

The proposal raises the city’s operational reserve from four months to six months; Encina said the six‑month reserve figure totals $30,828,000. The budget also contains targeted personnel adjustments: $575,000 to bring employees to 100% of base market rate, $180,000 for longevity pay and three reclassifications that Encina said have no fiscal impact. The document also lists planned event funding, including $100,000 for a Fourth of July celebration and $80,000 for the Asado and Brew Festival and Founders Day.

Council members pressed staff on cuts and service impacts as they reviewed line items. Mayor Nieves Radell and other members said the document reflects $11 million in service reductions across general‑fund services and warned those cuts would affect parks, police, fire and economic development. Council member Liz Cabrera requested a future budget retreat to allow deeper review outside the regular meeting schedule.

Encina said the budget schedule (Schedule A) required by the Arizona Auditor General was published May 25 and will be republished June 1 to meet the two‑week publication requirement before final adoption. She told the council that final adoption would follow the statutorily required notices and hearings.

After discussion, Council member Esteban Rosales moved to approve the tentative budget; the motion passed 5–1. The approval sets the spending cap and moves the process toward final adoption later in the budget calendar.

Council members and staff said they expect continued work sessions as they refine the final budget and reconcile cuts and remaining capital priorities.