National City Council accepts midyear budget report; projects deficit down to about $3.3 million

The National City Council voted to accept the fiscal year 2025 midyear budget status report after staff told the council the city’s projected general fund deficit would shrink to roughly $3.3 million by fiscal year end, down from a previously reported shortfall of about $7.5 million.

The midyear report, presented by Bruce Fultz, finance director, reviewed revenues and expenditures through the first seven months of the fiscal year and recommended adjustments including recognizing additional reimbursements and interest, delaying some capital projects and shifting $1.5 million of planned general fund capital spending to American Rescue Plan Act (ARPA) funds.

Why it matters: the report outlines the city’s near-term financial position and recommended changes that officials said will reduce the use of unassigned fund balance this fiscal year while deferring some capital work to the next fiscal year.

Fultz said property and sales taxes make up the majority of the general fund—property tax about 23% and sales tax about 56%—and that the city had received about 52% of budgeted property tax revenue through January. He also reported several midyear revenue adjustments: an expected roughly $500,000 in state reimbursement for fire overtime, an additional $276,000…