Port Hueneme council reviews draft budget, seeks $2 million in reductions; public works projects and utility funds under scrutiny

PORT HUENEME, Calif. — Port Hueneme city staff presented a draft budget at the council’s May meeting that trims more than $2 million in spending through departmental reductions, delayed upgrades and frozen vacancies while preserving an estimated $7.5 million in unassigned general‑fund balance as of June 30.

City Interim Finance Director Ashley (interim finance director) told the council the city began the budgeting cycle with a goal of 5% reductions across departments and ultimately identified a little more than $2 million in savings through contract reductions, travel/training cuts, postponed capital and vacancy freezes. “With those reductions and the freezing of the positions that were currently posted, we ended up, accomplishing, a little more than $2,000,000 in savings,” Ashley said during the presentation.

The budget documents and staff presentation framed the plan as cautious and deliberately conservative. Staff projected flat general‑fund revenues of roughly $27.2 million annually over the next two years and warned rising contractual costs and negotiated pay increases would widen gaps unless spending is held down. The draft would keep an emergency reserve equal to roughly six months of operations while using natural fund‑balance movement to cover a small deficit in the second year of the plan.

Public‑works priorities and enterprise funds under review

Public Works Director Fred Kimarillo (public works director) presented an annual update alongside the budget review and described nearly $4.8 million in proposed capital projects funded largely by grants and enterprise sources rather than the general fund. He summarized completed work in the last year — playground replacement at the beach, channel resurfacing aided by a $300,000 grant, force main replacement and renewed creek‑clearing — and a slate of coming work that includes storm‑drain repairs, road grind/overlay projects and multiple water‑line replacements.

At the same time staff warned that enterprise funds face pressure. The solid‑waste fund, the presentation said, is projected to fall below $1 million and could be reduced to about $55,000 by June 30, 2026, absent rate changes; wastewater reserves also decline in the multi‑year forecast. City staff said the council authorized a utilities rate study and recommended the city consider updated rate language that allows pass‑through of third‑party or vendor fee increases, and a five‑year standard for reviewing rates.

Services trimmed to hold the line

Staff described a long list of targeted reductions intended to minimize service impacts: postponing a Tyler public‑safety upgrade, delaying some contract traffic‑engineering hours, trimming special legal and recruitment budgets, reducing movie‑in‑the‑park events, shortening the lifeguard season back to Labor Day and freezing a subset of vacant positions including a finance deputy director and some public‑works and police vacancies. The city would also extend the computer replacement lifecycle from three to five years.

Council and public scrutiny

Council members pressed staff on the tradeoffs. Mayor Pro Tem Lopez asked whether a possible shift to pass‑through fees would include inflationary adjustments; staff said pass‑through language is often included in rate ordinances so the city is not forced to absorb third‑party increases. Several council members emphasized the need to preserve street, tree and public‑safety services even as other items are trimmed. A resident who spoke in public comment urged the council to consider revenue options — rate adjustments or tax measures — to ensure long‑term stability rather than relying solely on cuts.

Action taken

The council voted to receive the draft budget, incorporate public comment, and direct staff to return with the adoption item at the next meeting; the motion passed unanimously on a roll call vote.

Why it matters

Staff said the reductions buy the city time and keep a cushion in the general‑fund balance while the administration pursues grants and a utility rate study. Council members noted uncertainty in state and federal funding streams and told staff to continue to prioritize items that directly affect public safety and infrastructure.

What’s next

Staff will return with the formal budget adoption in two weeks’ time, the results of grant and rate‑study work as it becomes available, and a revised five‑year projection if revenues change.