Santa Maria council receives Q2 financial report, approves budget amendments and consent calendar

The Santa Maria City Council on Feb. 18 received and filed the city's second-quarter financial report for the fiscal year ending Dec. 31, 2024, and adopted a resolution approving multiple budget amendments for personnel and operational changes.

Interim Finance Director Bradford told the council that general fund revenues and expenditures were tracking at roughly 40% of budget at midyear, and that the city continues to face pressures from higher costs for goods, housing and insurance. "The revenues that we have received are at about 40 of the total budget, which is reasonable for half year mark," Bradford said. She noted hiring controls and other cost-saving measures designed to narrow the budget gap.

The council approved a series of amendments shown in the staff report. Key items in the amendments include drawing $3.1 million from a $13.2 million pension reserve to help cover pension-related pressures, reallocating two recreation and parks positions from the general fund to landscape district funds (estimated $200,000 benefit to the general fund), and appropriations for capital and program updates including a $1.9 million drainage project, $2.4 million in REAP grant funds for a sewer project, and $774,000 to purchase five transit buses.

Council member Sotto questioned whether some operating expenditures were carryovers from prior years and asked for clarification on expenditure categories. Bradford said capital carryovers appear in the capital improvement program but not in operating expenditures, and she explained that some timing differences affect contracts and services spending. On the proposal to use pension reserve funds, Bradford said the reserve was established in 2018 and that using part of it this year is a discretionary council decision: "These dollars were used for the specific purpose, and the pension expenditures that you see in the operating budget are higher and growing, and so it is reasonable to start drawing on this reserve."

The council voted on the resolution to adopt the second-quarter budget amendments; the roll call recorded in the minutes shows a majority vote in favor. The action to receive and file the report and adopt the resolution passed and was recorded in the official minutes.

The consent calendar was approved earlier in the meeting without items pulled for separate action except for discussion about coordination with Guadalupe transit; the consent vote was recorded by roll call.

Ending

The council directed staff to continue work on budget-balancing strategies, including examining possible revenue options and monitoring planned capital projects. Staff will return with additional recommendations during budget development.