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Adelanto officials say budget is balanced but still faces a structural shortfall
Summary
City finance staff told the Adelanto City Council the FY24''5 budget is balanced on paper thanks to one-time funds, but projected revenues of $21.3 million fall short of $22.8 million in expenses; staff said a midyear adjustment and continued grant pursuit are planned.
Adelanto city leaders presented a cautiously optimistic fiscal picture Sept. 25, saying the city has a balanced budget for fiscal year 2024''5 but continues to face a structural funding gap.
Finance advisor Julio told the City Council the most recent projections show $21,300,000 in projected revenues against $22,800,000 in projected expenses, leaving a deficit the staff plans to address in part with one'time monies and by pursuing grants and cost adjustments. "We have $21,300,000 in projected revenues and $22,800,000 in projected expenses," Julio said during his presentation.
The city manager and finance staff described several pressures: a decline in sales-tax receipts after one'time gains, a very low local share of property tax (about 1.75 percent of the typical 1 percent property-tax levy), and rising contract costs for public safety services. "For those playing at home, most people believe that the city receives all of the property tax. So when you have a 1% property tax on your property, the city actually only receives 1.75% of the 1%," Julio told the council, illustrating why the city must be creative in generating revenue.
Council members pressed staff on several line items. Councilwoman Jeanette asked for a sheriff-cost breakdown and requested a future presentation from county law-enforcement officials to explain year-over-year increases. The mayor and other council members asked staff to revisit marketing and IT line items and to bring a midyear adjustment back to the council in roughly 90 days.
City staff emphasized progress on audits and grant management as critical to unlocking additional transportation and infrastructure monies from county and state sources. The manager said audits in process should release roughly $700,000 from a county transportation authority and that properly spending grant funds will position the city to receive more in future rounds.
The council did not adopt new taxes or fees at the meeting. Staff said they will return with a more detailed midyear budget package, a review of vendor contracts and staffing allocations, and requested follow-up briefings on sheriff costs and marketing/IT needs.
The council scheduled the next formal budget update and audit review for the midyear process later this year.
