Half Moon Bay council approves mid‑year budget amendment, cuts print magazine funding

The Half Moon Bay City Council on March 4 adopted a mid‑year amendment to the fiscal year 2024–25 operating and capital budget after staff warned of lower revenues and rising costs.

City Finance Director Ken (last name not specified in the record) told the council the revision reflects weaker-than-expected transient occupancy tax (TOT) and sales tax receipts and recommended a conservative TOT estimate of $8.3 million. He said the net recommended revenue adjustment is roughly a $200,000 downward change and total expenditure adjustments amount to about $226,000. Under the revised plan, unassigned fund balance would fall to roughly $1.0 million and reserves would remain about $8.6 million.

The budget discussion came as council prepared for a priority‑setting workshop next week to guide the 2025–26 budget process. Council and staff emphasized that the city’s structural deficit remains a multi‑year issue driven by rising pension and public safety costs.

Councilors pressed staff on reserve policy and on what is being done to control costs. City Manager Matthew (last name not specified) explained the city’s reserve policy: a 30% general operating reserve plus a 20% economic uncertainty reserve adopted in 2019. He said the city has drawn on the economic uncertainty reserve in recent years and that unassigned fund balance should be used thoughtfully to rebuild reserves or fund one‑time projects.

Council also debated a $23,000 request from Communications to print two remaining issues of the quarterly Currents magazine. Council members described the magazine as a useful communications tool but said print costs and staff time were questionable during a budget squeeze. The council amended the resolution to fund one more print issue in the near term and transition future issues to an online edition; that amendment was accepted and included in the final resolution.

A motion to adopt the attached resolution to amend the fiscal year 2024–25 operating and capital budget, including the magazine adjustment, passed unanimously on a roll call vote (Johnson: yes; Nagengast: yes; Penrose: yes; Vice Mayor Redick: yes; Mayor Brownstone: yes).

Staff said the mid‑year changes aim to align spending with current revenue expectations while preserving critical services. The presentation also noted development fee gains and modest increases in some fee revenues that partially offset declines in TOT and sales tax.

Council directed staff to continue the fee study, complete priority‑setting next week, and return with budget language for the next fiscal year. The council also asked staff to confirm any remaining line‑item adjustments and return a consent item clarifying the exact funding transfers approved.

Votes at a glance

- Resolution to amend FY 2024–25 operating and capital budget (includes magazine amendment): Passed (Yes: Johnson, Nagengast, Penrose, Vice Mayor Redick, Mayor Brownstone).