Finance director warns of $10 million ongoing shortfall; council given framework for multi-year fiscal planning

San Ramon Finance Director Jennifer Wakeman presented a financial resilience framework to the City Council on Oct. 28 that described an ongoing general fund shortfall of about $10 million in fiscal year 2026 and proposed a multi-step process to address it.

Wakeman said the FY 2026 adopted general fund budget reflects approximately $81 million in revenue but that ongoing revenues trail ongoing expenditures by an estimated $10 million. She highlighted that sales tax and Measure N together account for about 35% of the general fund, property tax about 32.4%, and that those three sources account for roughly 67% of operating revenue. Wakeman reported an average annual revenue growth of 4% over five years compared with average expenditure growth of about 9% over the same period.

“Personnel costs make up the majority of the expenditures,” Wakeman said, noting that police services and public works constitute large shares of the general fund (32% and 28%, respectively).

Wakeman outlined near-term milestones the finance team will deliver: the FY 2025 audit in December and midyear FY 2026 numbers to the council in January 2026. Those results, she said, will inform FY 2027 planning.

As interim measures while council develops policy, Wakeman proposed three fiscal guidelines: no new programs or positions without an offsetting trade-off (new revenue or an expenditure reduction elsewhere); only spend revenues already in hand (don’t commit to money not yet received); and avoid unsustainable long-term commitments without fully accounting for future implications. She said the council will need to weigh a combination of solutions — spending reductions, efficiency measures and, if chosen, revenue options — to restore long-term balance, and that easy solutions are likely exhausted.

Wakeman also identified external risks that could affect the city’s finances, including potential refinery closures that could raise fuel costs, proposed state ballot initiatives that would raise the threshold for tax increases to two-thirds, and upcoming labor negotiations (SEIU in January 2026; police officers association in January 2027), which could have equity and ongoing cost impacts.

Council members asked for clearer forecasting, scenario modeling and more frequent snapshots of financial status. Wakeman said staff will provide the FY 2025 audit in December, midyear updates in January, and will begin reserve policy discussions in the near term. The council did not take formal action on the framework; staff were directed to return with follow-up materials and modeling.