Escalon council approves midyear budget review; straight-line forecast shows $51,000 shortfall if trends continue

The City Council unanimously approved the city’s midyear budget report after staff presented a straight-line forecast showing a potential $51,000 shortfall if revenues and expenditures continue at the current rate.

Staff explained that revenues and expenses do not arrive evenly through the fiscal year; revenues often come later, and the straight-line tool assumes identical second-half performance. Compared with the same point last year, the city has collected more revenue and incurred fewer expenses to date, staff said, but higher CalPERS costs and insurance increases have reduced some expected savings from vacant positions.

Finance staff said personnel costs are at about 48% of the year’s budgeted amount while many services-and-supplies accounts are above the 50% straight-line target. Staff is reviewing invoices and reallocating costs where appropriate, including checking whether slurry and crack-seal expenses posted to the general fund should instead be charged to enterprise funds. Staff also said interfund loan payments and Measure P sales-tax revenue timing will affect the next fiscal-year picture.

A council member moved to approve the midyear budget without changes; the motion was seconded and approved unanimously by members present. Council members thanked staff for the “turnaround” on budget controls and asked for the midyear report to be posted publicly.

Staff said they will continue to monitor spending closely, seek cost reductions where possible and bring any needed adjustments back to the council if revenues or expenditures deviate from the forecast.