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South Gate budget shows $8 million structural gap; council weighs cuts and new revenue options
Summary
City Manager Rob Houston and Finance Director Luis Frosto presented a FY 2025–26 proposed budget that relies on one‑time reserves for the coming year and shows a structural general‑fund shortfall that staff estimate could reach about $8 million next year without new revenues or deeper cuts.
City Manager Rob Houston and Administrative Services Director Luis Frosto told the City of South Gate City Council on June 10 that the proposed fiscal year 2025–26 budget is balanced for the coming year only through the use of one‑time reserves and transfers. The presentation warned that, without new revenues or sustained cuts, the city faces recurring general‑fund shortfalls that could total roughly $8 million next year and grow in subsequent years.
The administration’s overview said staff refined line‑by‑line spending and found ongoing expenditures — driven largely by employee compensation, benefits and rising insurance and pension costs — are now outpacing ongoing revenues. Frosto said the city has used ARPA and…
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