San Bernardino presents balanced FY 2025–26 budget proposal, preserves large reserves while deferring hiring

City staff on Tuesday presented a proposed fiscal year 2025–26 budget that projects modest revenue growth and preserves the city’s large fund balance while using a planned amount of reserves for capital projects.

The proposal, introduced by interim City Manager Bill Garrido, projects general-fund revenues rising to about $228.2 million next year and shows proposed general-fund expenditures of roughly the same amount. Garrido told the council the city is offering a balanced budget “amidst a complex and uncertain economic landscape.”

The city manager and finance staff said the proposal relies on a hiring deferral and other conservative assumptions to protect the fund balance. Zuiva Ruiz, who presented the revenue forecast, said staff assumed a modest 2.5% increase over projected year-end receipts and emphasized conservative assumptions to guard against volatility.

Jeanie Fortune of the finance department described reallocations and the proposed use of reserves. Staff is recommending a strategic use of approximately $23.8 million in reserves for capital improvement projects; Garrido told the council that even after the planned use the city would remain well above the municipal-code minimum reserve requirement of 25 percent, at roughly a 75 percent fund balance figure shown in the presentation.

Staff also proposed a hiring deferral that they estimate would preserve about $8.1 million in fund balance. Ruiz said staff will monitor revenues and may recommend lifting the deferral if revenue performance improves; council updates will be quarterly.

Azzam Jakesh, city engineer, presented the capital improvement program. He said the 2025–26 CIP request includes large investments in streets and storm drain projects, and summarized proposed capital funding totaling approximately $45.7 million across funds for the coming year, with significant shares drawn from Measure S and other special funds.

Garrido closed the presentation by noting the budget process timeline and confirming staff would return for a formal public hearing and adoption on June 4, 2025. Councilmember Norma Ortiz moved to approve the recommendations and asked staff to return with the requested refinements; staff said the formal adoption would be handled at the June 4 hearing and no final vote was taken at the workshop.

The workshop included department-level detail on positions and line-item reallocations, and staff provided supplemental materials on fund balances, position control and enterprise funds.

Looking ahead, staff said the proposed budget will be published for the June 4 public hearing, and councilmembers used the workshop to ask for follow-ups on specific items including legal and outside-counsel billing, the status of a workers’‑comp escrow related to the earlier fire transition, and the list of one‑time projects staff would recommend if reserves improved.