Encinitas council introduced balanced $146.6 million budget, schedules adoption for June 18

City Manager Graham Campbell introduced the City of Encinitasproposed fiscal year 2025-26 operating and capital budgets on May 28, saying the plan is balanced and meets the citypolicy reserves.

The proposed all-funds revenue total is $146.6 million, which staff said would fund $139.9 million in expenses; the general fund is estimated at $113.3 million. "We have a balanced budget," Campbell said, and finance staff told the council the proposal meets the city's 2% budget stabilization reserve and 20% contingency reserve policies.

Finance Director Tom Gallup told the council the item is an introduction for review and public input and that the city will return June 18 with the budget resolutions needed for final adoption. "This process is a way for the city council to authorize spending through appropriations before the beginning of the new fiscal year on July 1," Gallup said.

Why it matters: the proposal funds new recurring and one-time items discussed in budget workshops and preserves funding for capital projects and debt obligations while maintaining a modest unassigned general-fund balance. Council members and speakers used the session to ask questions about specific programs, capital priorities and smaller community requests such as flags and interpretive signage at a veterans memorial.

Key budget details and new spending

- Revenues and reserves: Staff presented estimated all-funds revenues of $146.6 million, a $4.9 million (3.4%) increase over the current fiscal year, largely driven by higher property tax receipts. The proposed operating budget assumes $139.9 million in expenses and a roughly $500,000 unassigned ending fund balance in the general fund.

- Public safety and personnel: The budget includes funding for two traffic deputies under the San Diego County Sheriff contract (presented as $916,000 in total, with about $360,000 recurring and approximately $196,000 in one-time startup costs) and $179,000 for a deputy fire marshal (one new FTE). Staff said a previously approved homeless solutions coordinator position that remains unfilled would be removed (about a $208,000 reduction), producing a net change of roughly zero FTE to the general fund when combined with the new fire marshal.

- Homeless services and contracts: The development services budget includes a $224,000 increase for case management and outreach contracts to implement the homeless action plan. The agenda packet also shows $186,000 proposed as an optional contract extension for the Buena Creek Navigation Center, to begin in January after existing state permanent local housing assistance funds expire.

- Utilities and enterprise funds: Utility-funded (enterprise) items include adding one senior management analyst in wastewater administration at $220,000; staff said that position would be cost-shared 50/50 with the San Dieguito Water District and would not affect the general fund. An $80,000 general-fund increase for permit-parking zone software was proposed for the engineering department.

- Capital program: The proposed fiscal year 2025-26 capital budget appropriates $16.2 million from all funds, including $5.2 million from the general fund and $11.1 million from other funds (for example, Encinitas and Cardiff sanitary divisions). Staff listed specific projects funded or programmed at Budget Workshop 3, including $800,000 for SwamiBeach stair refurbishment, $500,000 for corrugated metal pipe lining, $600,000 for pavement rehabilitation and overlay, $400,000 for temporary Fire Station 6 design and permitting, $500,000 design for South Vulcan Avenue storm drain mainline (Union Street to Moonlight Beach), $750,000 for L7 park development design, and numerous smaller street, park and drainage items. Gallup said the five-year CIP plan totals $65.1 million through FY 2029-30, of which $9.4 million is shown as general-fund contribution.

Questions and public comment

Several members of the public and council raised community-scale and line-item questions. Mark Wisniewski, a veteran, urged restoration of interpretive signage and flags at the Cottonwood Creek Park memorial and requested parks staff review the memorialsite pump and provide cost estimates. Ellen Burke questioned the $750,000 for L7 park development and asked for clarity on what the money would fund; Mayor Ehlers and staff responded that the amount is for design work and is funded from park mitigation fees. Natalie Satune asked the council to include downtown flag decorations for Fourth of July in the budget.

Deputy Mayor Kellie Lyons said she supported pursuing interpretive plaques and flags but noted the budget is advanced in the process and that community groups or nonprofits might partner with the city to fund smaller items this year. Mayor Ehlers and other council members emphasized the city's stronger-than-expected revenue outlook and noted potential additional funds from FEMA reimbursements and future development impact fees as projects move to occupancy.

Next steps and schedule

Staff asked for council direction during the meeting and will return on June 18 at 6:00 p.m. with resolutions for final budget adoption. Gallup also noted that vehicle and equipment replacement schedules and any changes would return to council if staff propose revisions. City Manager Campbell said a mitigation-fee study and a fees review are underway and that staff will evaluate whether some user fees should be adjusted in FY 25-26.

Limitations: The council introduced the proposed budget for review and did not take a final vote during this special meeting. Detailed budget schedules, attachment references and the department-level packet pages were cited by staff for more granular figures.