Placerville council directs staff to return 2025–26 budget after hearing on shortfall, program cuts

The Placerville City Council on June 10 directed staff to return the proposed fiscal year 2025–26 operating and capital improvement program budget for formal adoption at its June 24 meeting after a staff presentation and public hearing that laid out a general-fund shortfall and proposed program reductions.

City Finance Director Dave Warren told the council the city’s Bradley-Burns sales tax — the single largest source of general‑fund revenue — is forecast at $6,249,799 for 2025–26, but receipts for the current year are running below budget. "We began the budget with a million 29,000 deficit or 8.57%," Warren said, summarizing the gap staff is working to close.

Warren and other staff presented a range of adjustments to bring the budget into balance. Key proposals included a one-time transfer of $321,000 from the Road Maintenance and Rehabilitation Account (RMRA, commonly called SB 1) to support routine road maintenance; a proposed increase to the city master fee schedule (shown as $168,000 in preliminary estimates, pending separate council action); and $1,056,000 in additional budget adjustments overall. Staff also recommended no general-fund contributions to capital projects in the coming year and limited contingency reserves.

City Manager Morris and department directors described program and staffing changes meant to reduce costs. The planning/development services budget would freeze an open associate planner position as a temporary measure, and code-enforcement functions would shift from Development Services to the Police Department, with vehicle-abatement duties added to code-enforcement staff. Staff said vehicle-abatement revenue is expected to help offset the position’s cost; the budget presentation showed fines/forfeitures increasing by roughly $66,000 largely because of the vehicle-abatement program change.

Community services and recreation adjustments were also detailed. Director Nishihara said the city will continue lap swim, swim lessons and water aerobics at the Placerville Aquatic Center, but will limit public‑swim hours during the week and provide public swim primarily on weekends. "We will be limiting the public swim hours and only offering public swim during the weekends and not during the weekdays," Nishihara said.

Warren summarized several pressure points: a roughly 10% anticipated increase in medical insurance costs, an 11.9% workers’ compensation increase, an 8.21% rise in general liability insurance and a projected 8.4% higher pension employer contribution. He also noted the city had expected a county contribution to the aquatics program in prior years but was told the county would not be able to contribute this year.

During the public hearing, resident Sue Rodman praised staff and the budget committee’s handling of the tight year, saying, "we are not so deep in the hole it's gonna take us years to dig our way out. So I'd like to congratulate Dave and his team for doing an excellent job." Another resident, Kathy Lishman, urged caution on the proposed reorganization and the frozen planner position, warning that shifting code enforcement to police "doesn't seem to be in the best interest of the city" and that enforcement needs to remain effective to protect the city's appearance and development standards.

Council members thanked staff for the work producing the package and emphasized that several changes are temporary and will be reevaluated at midyear. The council's motion approved by roll call directed staff to return the 150‑page proposed budget and related documents for formal adoption on June 24; the motion passed on a 5–0 vote.

The budget presentation also included capital project updates: staff described a proposed list of maintenance and construction projects financed in part by Measure H and Measure L sales-tax proceeds, and asked the council to preserve flexibility in the Measure L construction reserve as several projects approach construction in 2026. Staff said a water/wastewater cost-of-service and rate study will be completed in July with a workshop expected in August.

The council’s direction does not adopt the budget; it authorizes staff to prepare the final adoption package for the June 24 meeting and to return with any additional materials requested, including a master-fee schedule and midyear evaluations of frozen positions and reorganizations. The council record shows the vote was unanimous: Councilmembers Carter, Noe, Yarbrough, Vice Mayor Gottberg and Mayor Clarizzi voted in favor.

What’s next: staff will return a final document on June 24 for council adoption, complete the water/wastewater rate study this summer, and present a master fee schedule and midyear staffing evaluations in early 2026.