Sunnyvale adopts 2025–26 budget, funds three firefighters and approves modest tax increase

The Sunnyvale Town Council on Sept. 15 adopted the fiscal year 2025–26 budget, approved a 3.5 percent pay increase for all employees and voted to raise the property tax rate as part of a package of actions to fund ongoing operations and capital projects.

On separate votes the council approved: (1) the annual budget and a $220,000 appropriation to add three full‑time fire department positions to improve minimum on‑apparatus staffing (motion carried 5‑2); (2) an ordinance adopting a tax rate of 0.4630 per $100 of assessed valuation (motion carried 5‑2); and (3) a statutory ratification of the budget revenue increase tied to the adopted rate (motion carried 5‑2). Councilmembers recorded those votes in roll calls following the motions.

Staff presented the budget as balanced for the fiscal year while showing projected revenues of about $73,900,000 and projected expenditures of about $87,200,000, reflecting bond proceeds and planned capital spending in the construction/bond funds. The adopted budget funds the $36,000,000 certificates of obligation approved earlier in the meeting, provides a 3.5 percent pay increase for all employees (including police and fire) and extends the fire pay scale to 10 steps so top‑out firefighters also receive the 3.5 percent increase. Staff said the budget also assumes an 8.5 percent water and sewer rate increase and a 4.9 percent trash increase already discussed earlier in the meeting.

Council debate focused on public safety staffing and compensation. The fire chief told the council that current funded positions are filled but that additional staffing is needed to ensure minimum on‑apparatus staffing when personnel are absent; the requested three positions were described as providing one additional person per shift to preserve a four‑person engine crew in common absence scenarios. Council voted to fund those three positions at an estimated recurring cost of about $220,000.

The police department had earlier withdrawn a separate request for one additional officer; staff told the council that police currently have two unfilled positions and are actively recruiting. Staff estimated the cost for a single additional police position at about $70,000 plus benefits (~$82,000) but said the department’s specific request was not funded in the adopted budget.

Councilmembers and staff discussed compensation policy. Lily (Human Resources) said she will conduct a comprehensive compensation study and return with midyear recommendations. Staff reiterated that using fund balance to pay ongoing recurring costs is not recommended; staff noted the town’s general fund balance equates to about 97 days of operating reserves under the current policy (the utility fund policy is higher, at about 120 days). Councilmembers discussed midyear options, the town’s recent sales‑tax gains from new businesses and the possibility of adjusting compensation later in the fiscal year if revenues exceed conservative projections.

Capital project discussions tied to the budget included an $8,000,000 allocation for Jobson Park work and a $5,000,000 allocation for an animal shelter shown in the bond plan. Staff said those allocations are preliminary and the bond was structured for flexibility so money can be reallocated among projects if final bids differ from estimates. KSA is the consultant working on preliminary animal shelter designs; staff said the current 2021 designs call for a facility similar in size to the present shelter and that the final design and bids will be returned to council for review.

Public comments included a speaker from animal control who described current kennel capacity and operational constraints; staff and design consultants said further design work and bids are needed to determine final scope and cost. The adopted budget will be implemented and staff will return to council with midyear compensation study results and project bid outcomes.