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Fountain Valley council accepts midyear budget review; small net improvement to projected deficit
Summary
Finance staff presented midyear revenue and expenditure adjustments that modestly reduced the FY 2025–26 projected use of reserves; council approved the midyear adjustments with one abstention and directed staff to continue department projections for the next budget cycle.
Finance Director Ryan Smith presented the midyear review for fiscal year 2025–26. Staff reported operating revenue adjustments of roughly $1.6 million (including higher sales tax projections and OCTA reimbursement), offset by operating expenditure increases of about $1.5 million. After accounting for capital adjustments and designated uses of reserves, the net effect was a modest reduction to the previously projected use of reserves.
Key details cited by staff included: sales tax revisions based on consultant projections, OCTA reimbursement related to I‑405 work, EMS revenue and offsetting fire expenditures (related to the ambulance program), internal service fund increases for fleet and vehicle upfitting, and CIP design additions funded from existing reserves. Finance staff said the midyear review would inform the FY 2026–27 budget process and that departments will be meeting with finance in May and June ahead of a June/July council presentation.
Vote: Council approved the midyear adjustments; the minutes record a 4‑0 vote with one abstention (Council Member Bowie). Councilmember discussion included appreciation for multi‑month staff work and a suggestion to clarify that the review represents Year‑1 of the biannual budget cycle.
Next steps: Staff will continue projection work and return with recommended adjustments as part of the FY 2026–27 budget process.
