Seaside council trims FY 2025–26 budget; defers two capital items and reduces street transfers

The City Council of Seaside voted unanimously June 12 to accept staff recommendations that reduce the city's immediate reliance on the general fund by deferring two general-fund capital projects and cutting planned transfers to the street fund.

The action followed a budget study session in which Finance Director Jessica Riley summarized the proposed FY 2025'26 general fund budget: $48.3 million in operating revenues and expenditures and a modest projected operating surplus of about $60,000, but an unassigned fund balance projected to fall roughly $1.7 million short of the 30% reserve target set in the municipal code. Riley told the council staff had trimmed $4.6 million from initial department requests but that the reserve gap remained.

Why it matters: the council must balance services and infrastructure needs against the city's policy on maintaining a minimum unassigned fund balance. Council members and staff framed the vote as a way to preserve the budget's structural stability without immediate staffing reductions.

Key details from the presentation - City Manager and Finance Director said total capital allocations for FY 2025'26 are roughly $2.7 million, including $625,000 in capital improvement projects and $2.0 million specifically set aside for street maintenance and repair. - Staff identified two general-fund capital projects for possible deferral to preserve cash: the Hilby storm drain project (estimated savings $200,000) and a FabLab trailer purchase (estimated savings $370,000). Deferring both would free about $570,000. - Staff proposed reducing general-fund transfers to street operations by $750,000 for FY 2024'25 (midyear) and another $750,000 for FY 2025'26, for total potential savings of $1.5 million. Staff said those reductions were feasible because of recent efforts to perform more street rehabilitation in-house and other cost-control measures. - Staff warned that withdrawing funds from the city's Section 115 pension trust (a possible source of up to $4.1 million) would undercut a long-term strategy to pay pension liabilities and was not recommended except as an emergency measure.

Council direction and vote Council accepted the staff recommendation as a package for finalization and presentation at the next meeting. The city clerk recorded the roll call: Councilmember Miller (yes), Councilmember Garcia Arizola (aye), Mayor Pro Tem Pacheco (yes) and Mayor Oglesby (aye). The clerk announced the motion passed unanimously of the members voting. The motion did not identify a mover or seconder in the transcript.

What happens next Staff will prepare the final proposed budget reflecting the council's direction and return to the council for action on June 24. Finance staff said the city can reconsider deferred projects later in the fiscal year if outside grants or other revenue materialize.

Ending note City staff emphasized that the chosen mix of defenses—targeted deferrals plus reduced transfers to the street fund—was intended to be a measured approach to close the short-term gap while preserving the city's long-term fiscal health. "Our goal is to bring a revised, compliant budget to the City Council for consideration on June 24," Finance Director Jessica Riley said.