San Leandro unveils proposed FY 2026–27 biannual budget with cuts, use of reserves and new funding for rent registry and alternative‑response unit

The City of San Leandro on Monday released a proposed FY 2026–27 biannual operating and capital budget that trims previously projected deficits but still relies on the city’s reserves to balance the two fiscal years.

Nicole Gonzales, the city’s finance director, told the council the revised forecast projects a use of general fund balance of $6.1 million in fiscal 2026 and $6.4 million in fiscal 2027 after department reductions and technical adjustments. Gonzales said the city’s adopted fund‑balance policy sets aside $5 million for major emergencies and a target reserve equal to 20% of regular operating costs; the proposed budget meets the council’s target for FY2026 but falls short of the council policy in FY2027 if current projections hold.

“We did meet the goal for fiscal year 2026,” Gonzales said, “and we were able to reduce the projected use of fund balance in FY 2027 from earlier projections, but additional work will be needed in subsequent years for long‑term sustainability.”

Major points in the staff presentation and committee discussions:

- Revenues and expenditures: The citywide operating budget projects roughly $225 million in total city revenues across all funds; the general fund revenue projection for FY2026 is about $149.9 million against expenditures near $156.1 million,…