Calimesa council adopts midyear budget amendment, transfers funds for pavement and vehicle replacement

Celeste Reed, Calimesa finance director, presented the midyear review of the fiscal year 2024–25 budget and recommended adjustments that the City Council adopted as Resolution No. 2025‑05.

Reed said the city’s FY 2023–24 actuals showed $12.4 million in revenues versus $11.3 million in expenditures, leaving a net surplus that produced transfers into earmarked funds for capital needs. “It is my pleasure to present to you the mid year budget review for the fiscal year 2425,” Reed said during the presentation.

The adjustment package approved Monday moves one-time and ongoing dollars across funds. Major transfers described in the staff report include $1 million to the pavement management program, $750,000 to the vehicle replacement fund, $200,000 to information technology, a $161,000 transfer to close a shortfall at Mountain View Park, and $125,000 toward the Monarch fire pumper acquisition. Reed said the city’s net surplus for the year was about $1.4 million and that $2.3 million was transferred to other funds for planned projects.

Reed identified a set of one-time expenditures the city will use reserves to cover, totaling roughly $734,000. Those items include carryovers from FY 2023–24 projects ($222,000), senior center improvements (roof and restroom work), fire department equipment and training, a development impact fee study, and minor IT and facilities purchases. Reed told the council the increase in insurance costs — which she said rose more than expected, about 27% for the general fund liability line — was a significant driver of increased ongoing expenditures.

Council members asked for clarification on several numbers and praised staff for the level of detail in the slides. Mayor Molina and other members noted the council’s reserve policy, adopted in September 2024, guides how one-time surplus is allocated; Reed said the policy currently aims targets around a 35% reserve position to protect the city’s operating budget.

Councilmembers approved Resolution No. 2025‑05 to amend the FY 2024–25 budget. The motion passed 4–0. The council directed staff to proceed with the adjustments and continue work on the FY 2025–26 budget process, including separate upcoming workshops on capital and operating budgets.

Reed said staff expects to present the final FY 2025–26 budget to the council on June 2, 2025 and that the city will continue to monitor interest income, sales tax and insurance trends when finalizing next year’s projections.