Sonoma City Council adopts balanced FY 2025–26 budget with modest surplus, funds for parks and homelessness

The Sonoma City Council approved the city’s fiscal year 2025–26 operating and capital budget Monday evening, adopting a budget the city called balanced but cautious amid regional economic uncertainty.

Finance Director Propti Arjo presented the plan to the council, saying, “Tonight, I'm here to present you fiscal year 25 26 operating and capital improvement budget.” The package the council approved includes a general fund revenue estimate of about $28.8 million and proposed general fund expenditures of about $28.6 million, producing a modest surplus the staff estimated at roughly $200,000.

The nut of the proposal is conservative revenue projections and targeted one‑time spending. City Manager David Guillen told the council the document was designed to respond to uncertainty: “the budget that's before you today, has done a lot to try to address uncertainty,” and staff would return if conditions changed. The finance director said personnel costs rose about 10% and the city’s CalPERS unfunded liability (UAL) increased roughly 9%, both primary cost drivers.

Key budget details and priorities

- General fund: Proposed general fund revenue $28.8 million; proposed general fund expenditures $28.6 million, producing a narrow projected surplus for FY 2025–26. The city projects modest surpluses in out years but emphasized that those projections are sensitive to changes in public‑safety contract costs and other drivers.

- Major revenue drivers: Transient occupancy tax (TOT), property tax and sales tax remain the top three revenue sources. The…