Escondido outlines preliminary FY 2026 budget, earmarks Measure I revenue for public safety, infrastructure and staffing

City of Escondido staff on May 20 presented a preliminary fiscal year 2026 operating budget and recommended allocations for Measure I, the voter-approved 1-cent local sales tax, saying the plan would restore positions, replace vehicles and apparatus, and fund deferred maintenance while leaving final adoption to council votes in June.

The presentation, led by Christina Holmes, the city’s finance director, said Measure I — a general tax that raised Escondido’s sales tax rate from 7.75% to 8.75% effective April 1, 2025 — is projected in staff’s preliminary forecast to produce $38,484,150 in the first year (the figure is the average of two consultant models cited in the presentation). Staff recommended a Measure I operating budget of $29,644,300, leaving an initial unallocated balance of $8,839,850; staff also proposed allocating $2,000,000 of Measure I revenue to the City Streets program and returning to council with more refined revenue data after the first full quarter of receipts in July 2025.

Measure I and why it matters

Holmes told the council that Measure I is a general tax and therefore not legally restricted to specific programs; staff used the ballot language only as a guideline when preparing the initial spending plan. The presentation noted typical uncertainties in forecasting sales tax — including volatility in auto sales, which are a major source of Escondido’s tax revenue — and described two consultant capture-rate scenarios: HDL projected about $35 million (a 77% capture rate) while Avenue Insights projected about $41 million (92% capture). Staff recommended budgeting the midpoint of those forecasts, $38,484,150, and promised a report after the first quarter of actual distributions, which the city expects to receive beginning July 2025.

Holmes said the Measure I revenue was modeled on the city’s existing sales tax base and reminded the council that, under the city’s preliminary breakdown, of each $8.75 collected on $100 of taxable sales roughly $6 goes to the state, $1 to the city, $0.50 to TransNet and $0.25 to the county, with the additional $1 applying as the local district tax for Escondido.

Major recommended Measure I investments

Staff proposed moving a range of personnel costs and capital needs off the general fund and onto Measure I in order to close structural budget gaps without cutting core services. Key recommended items included:

- Public safety: funding for seven COPS officers to remain in the field; a new police program coordinator and funding for the department’s maintenance-and-operations needs, plus replacement of 37 police vehicles. Interim Police Chief Ryan Banks said the 7 COPS officers "will continue to quickly respond to calls for service, proactively address issues throughout the community and help find housing solutions for community members experiencing homelessness." The police proposal also lists continued contracting for animal-control services; the current agreement with the San Diego Humane Society runs through June 30, 2026, after which staff said they are researching alternatives.

- Fire department: funding to maintain the city’s seventh station and a fifth ambulance, three new leadership/administrative positions (division chief, battalion chief, administrative assistant), and replacement apparatus including two utility trucks and three Type 1 engines; Division Chief Tyler Batson said replacement engines typically have 2–4 year build times.

- Development services and planning: three planner positions to update municipal and zoning codes and the general plan, two code-compliance officers to support upcoming short-term-rental enforcement, inspector and plan-examiner positions to reduce permit processing times, and a traffic-engineer position to address a backlog of traffic safety analyses.

- Public works and community services: restoration of community programs, special-events support and positions to manage recreational programming; a list of one-time projects to address deferred maintenance (including elevator refurbishments and other critical facility repairs); Climate Tech work to design an energy road map and funding for estimated debt-service payments to support potential financing.

- Reedy Creek: staff recommended using Measure I to supplement Reedy Creek’s operational shortfall caused in part by delayed equipment deliveries; staff said Reedy Creek’s activity is up while its operating costs remain high and that some ARPA-funded equipment had not yet arrived.

- Legal, communications and administrative capacity: a deputy city attorney and clerical support to handle increased enforcement caseloads; a communications position and an online two-way community outreach tool; a human-resources technician to focus on recruitment amid a high vacancy rate.

Budget context and risks

Holmes summarized the city’s multi-year structural deficit history: without new recurring revenue, the presentation said annual general fund deficits could exceed $10 million and grow over time; earlier budget actions had used one-time funds and position eliminations to reduce gaps. Staff noted that the library and the California Center for the Arts had been temporarily funded with American Rescue Plan Act (ARPA) dollars and that those one-time funds are scheduled to end. Holmes said the city closed FY2025 without using reserves but that, absent new revenue, reserves would be depleted in future years.

Holmes also highlighted a $2.2 million increase in the city’s projected CalPERS (pension) unfunded-accumulated-liability payment for FY2026 and rising insurance premiums driven by larger loss events and climate-related damages. She recommended the council adopt the fiscal year 2026 operating and capital budgets at public hearings scheduled in June, and noted staff would return with updated sales-tax receipts and a capital improvement program workshop June 11 and final budget adoption June 18.

Council response and next steps

Council members thanked staff for the presentation and asked clarifying questions about Reedy Creek equipment timelines, the proposed online outreach tool, the list of city events and how Measure I dollars would be invested. Deputy Mayor Martinez and several council members expressed strong support for prioritizing public safety, staffing restores and infrastructure work. Several council members emphasized transparency in reporting back to the public about how Measure I funds are spent and requested ongoing performance metrics.

Votes at a glance

- Consent calendar (Items 1–7): motion to approve (mover and seconder not specified in the public record); voting: Mayor Dane M. White — yes; Deputy Mayor Martinez — yes; Councilmember Fitzgerald — yes; Councilmember Joe Garcia — yes; Councilmember Christian Garcia — yes. Outcome: approved 5–0.

- Board and commission appointments: motion to approve mayor’s recommendations (mover and seconder not specified); voting: Mayor Dane M. White — yes; Deputy Mayor Martinez — yes; Councilmember Fitzgerald — yes; Councilmember Joe Garcia — yes; Councilmember Christian Garcia — yes. Outcome: approved 5–0.

What the council scheduled next

Holmes concluded that staff will analyze actual Measure I receipts after the first quarter of distributions and return with a report. The council also set a capital improvement program workshop for June 11, 2025, and scheduled final budget adoption on June 18, 2025.

Ending

Holmes said staff would bring updated revenue data after the city receives its first Measure I cash distributions in July 2025 and that staff will present detailed capital requests and recommended Measure I allocations in the June workshops. The council did not take final action on the FY2026 operating or Measure I budgets at the meeting; those adoptions remain scheduled for June.