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Finance director flags $1.6M reserve shortfall; council adopts 2027 budget calendar
Summary
Finance Director Seiya Magaranu told the council the general fund is projected to end 2025 with about $8.9 million (29.6% of next year's budget), roughly $1.6 million short of a 35% reserve target; council approved a budget calendar for the 2027 process and scheduled an April 20 work session for budget priorities.
Roseville — Finance Director Seiya Magaranu told the City Council on March 16 that preliminary 2025 numbers show the general fund projected to end the year with about $8.9 million, which is roughly 29.6% of the 2026 budgeted expenditures and about $1.6 million below the city's low policy target of 35%.
"We landed or projected to end the year about 29.61% which is below our low target of 35% or about $1,600,000 short," Magaranu said, explaining that the calculation compares projected 2025 fund balance against 2026 budgeted expenditures and that final numbers will be refined after closing the books and an audit.
Magaranu reviewed other funds: the parks and recreation fund is projected at about $2.1 million (just above its policy target), the communications fund is projected below its target and may need a transfer (about $40,000), and the Lisonbee (passport) fund shows a surplus. Staff said they will return in April with a staff recommendation about transfers and adjustments once year-end accounting is complete.
Council members discussed the mechanics of reserves and the trade-offs of using cash reserves versus raising levies. Several members emphasized that the projected shortfall is relative to the 2026 budget baseline and that the city is not operating at an operational deficit for 2025.
On the same night, council adopted the 2027 budget calendar. The calendar schedules a preliminary levy by Sept. 28, a budget hearing after Nov. 24 and final adoption in December; council also set an April 20 work session for department heads and a strategic budget conversation.
Votes at a glance: The motion to adopt the budget calendar passed unanimously. The council also approved minutes and a five-item consent agenda (payments, temporary gambling permits, purchase of radios and chipper, pathways to policing grant application, and amended SRO contract) without dissent.
What happens next: Staff will close the 2025 books, complete the audit and return with transfer recommendations and historical fund comparisons at the April meeting and proceed with the budget timeline adopted by the council.
