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Montebello projects a modest FY25–26 general fund surplus; council approves midyear report
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Summary
Finance staff reported a projected FY25–26 general-fund surplus of about $260,000 driven by higher sales and permit revenues; the council approved the midyear budget report 5–0 after questions about county and state tax measures.
City finance staff told the council the FY25–26 general fund is now projected to end about $260,000 in surplus, down from an adopted surplus of roughly $895,000 earlier in the fiscal year.
Finance director Michael Solarsa outlined revenue and expenditure trends, citing stronger sales tax and permit revenue. He said sales-tax receipts rose notably (retail sales up 24.7% in one quarter comparison), property-tax revenue was up (an example figure of $658,000), and several one-time revenues and fee updates are supporting current forecasts. Solarsa also highlighted strong hotel operations (Home2 Suites and Hilton Garden Inn) and noted increased expenditure projections tied to recently negotiated memoranda of understanding and maintenance needs.
Council members asked whether a proposed county half-cent sales-tax ballot measure and pending state legislation (referred to as AB 1768 in the discussion) could affect Montebello’s share of sales taxes. Staff explained that Montebello currently receives about 1.75% of the local 10.25% sales-tax rate and that existing legal structures (Bradley-Burns and a local transaction-use tax) protect that share under current conditions; staff cautioned, however, that state action could alter the broader landscape.
Council member Peralta moved to approve the midyear report; Mayor Pro Tem Romero seconded and the council adopted the item by roll call, 5–0.
What’s next: Staff will continue preparing the 2026–27 draft budget and present community-survey results and capital-improvement planning in upcoming meetings.
