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Tustin Reports $4.4 Million FY 2024–25 General Fund Surplus; Council Approves Closeout Actions
Summary
City finance staff reported an unaudited $4.4 million general‑fund surplus for FY 2024–25 driven by higher sales tax receipts and departmental underspending; council approved supplemental appropriations and carryovers 5–0 and asked staff to present mid‑year forecasting improvements.
Tustin’s finance director told the City Council on Oct. 21 that the city closed fiscal year 2024–25 with an unaudited general‑fund surplus of $4,400,000 and a reserve balance just under $35 million. Director King attributed the improvement to sales tax receipts coming in roughly 5% above budget and to lower than budgeted departmental spending.
“On a recurring basis, the general fund is above budget by $3,000,000,” Director King said in the presentation, and he described recurring surplus of about $3.3 million and additional one‑time items that produced a total unaudited surplus of $4,400,000. The council also heard that the Water Fund moved from a deficit to a surplus position compared with the prior year and that legacy‑related funds had substantial available balances: the backbone fee fund ended the year with roughly $17,000,000 available and the land sale proceeds fund with just over $90,000,000, according to the presentation.
Staff requested several supplemental appropriations and carryovers to close out the fiscal year. Council members pressed staff on a $2.5 million line item for hangar fire costs (Director King confirmed this appropriation is for FY 2024–25) and on a Navy reimbursement figure included in the agenda report; Director King said staff had invoiced over 98% of the reimbursement amount identified in the report and expected further payments as invoicing is processed. The exact Navy reimbursement total in the meeting transcript is recorded inconsistently; the council asked staff to clarify that dollar amount in upcoming reports.
Councilmembers thanked staff for the stronger reserve position but urged careful use of one‑time transfers. “We have been making decisions on an annual basis...we want to make sure that we have — we’re predictable and that we have reliable data moving forward,” one councilmember said. The council approved the staff closeout recommendations on a 5–0 roll call and directed staff to incorporate updated CalPERS assumptions in the next UAL funding plan and to return with a user‑fee and cost allocation study in January.
What happens next: staff will bring mid‑year budget updates and the user‑fee study to the council in early 2026 and present clarified figures for Navy reimbursements and any carryover appropriations.
