Escondido council adopts FY 2025–26 operating budget, leans on Measure I while warning of long-term deficits

The Escondido City Council on June 25 adopted the fiscal year 2025'026 operating budget and a required appropriations limit, approving two resolutions to finalize the city's spending plan.

The budget, presented by Christina Holmes, the city's director of finance, relies on an estimated $38,484,150 from Measure I and projects total sources of $178,649,880 against operating uses of $171,507,390. The council voted 5-0 to adopt resolution number 2025-74 approving the operating budget and resolution number 2025-75 setting the appropriations limit.

Holmes told the council the package includes one-time investments and recurring additions across departments, including funding for critical infrastructure repairs, a citywide customer-service initiative, an economic development program (including an ag- and agtech-focused innovation hub and property-based improvement district), resources for Reedy Creek Golf Course, and initial funding for a Climate Tech citywide energy roadmap project. The recommended operating budget restores or adds staff citywide: 27 new full-time positions, nine positions upgraded from part time to full time, and five positions reinstated from prior cuts. The proposed vehicle and equipment purchases listed in the presentation included replacement of two fire utility trucks, three pumpers and 37 police vehicles.

Holmes said the overall operating revenue is projected to be roughly flat compared with the current year, with an overall decrease of about $40,560. She attributed revenue declines to softer sales-tax and charges-for-services receipts, including the end of a $1 million partnership with the Escondido Union School District that previously reimbursed the city for a before-and-after-school program. Holmes said staff will bring a separate, later report on the Climate Tech citywide energy program and proposed financing plan.

Why it matters: Council members and staff emphasized that Measure I provides funding over the next 20 years to preserve essential services and to invest in projects, but they also noted the city's general fund faces a persistent structural deficit. Holmes said the long-range forecast shows annual deficits now exceeding $10 million and rising to as much as $24 million by fiscal year 2035, even with Measure I revenues.

During public comment Victoria Nayak, an Escondido resident, urged the council to prioritize affordable housing and flagged what she said appeared to be a large reduction in a rental-subsidy line on a budget page (from $37,000 to $3,700). Holmes and Danielle Lopez, the city's housing and neighborhood services manager, responded during the hearing that staff would verify the line-item figure. Lopez later told the council that she had not seen an actual decrease in CDBG funds and that the homeless subcommittee had identified about 10 available rental-assistance slots that had not yet been applied for.

Council discussion acknowledged the one-time and recurring investments proposed and emphasized the need to address the longer-term structural deficit. Several council members thanked staff for work on the budget and urged improvements to the budget-process timeline so community workshop feedback can be provided earlier in future cycles. Deputy Mayor Martinez said the new budget tools and additional staffing will help implement infrastructure projects and the Climate Tech program if council approves the later contract details.

The council approved the two resolutions on unanimous 5-0 votes.