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Napa council adopts midyear financial adjustments; city trims some projections and boosts reserves
Summary
Council received the city’s FY 2025–26 midyear financial report and approved a package of revenue and expenditure adjustments, staffing plan changes and reserve increases; staff recommended using prior-year fund balance for certain one-time projects and adjusting sales-tax and TOT projections.
The Napa City Council voted Tuesday to adopt midyear budget adjustments and staffing plan changes intended to align revenues and expenditures with current trends through Dec. 31, 2025.
Seth Anderson, the city’s budget officer, told the council that general fund revenues are tracking at about 40% of the adopted budget and expenditures just under 39% through the first half of the fiscal year. "Our revenues are tracking at 40%, and our expenditures are tracking just under 39% of the budget as of 12/31/2025," Anderson said.
Staff proposed a set of adjustments that would increase projected transient-occupancy-tax (TOT) revenue by $1,790,000 based on outperforming receipts in late 2025, recommend a $640,000 reduction in 1% Bradley Burns sales-tax projections, and use portions of prior-year unassigned fund balance for purposes including a $3.5 million contribution for pension mitigation and $5.0 million toward Harvest recreational-site demolition and planning. The package also includes several position reclassifications and the addition of one limited-term FTE to support Harvest site work.
On enterprise funds, staff recommended adjustments to solid-waste and recycling revenues to reflect a refuse-rate change effective Jan. 1, 2026, and higher material-sales revenue; expenditure adjustments include contract and tip-fee updates and a proposed increase in contractual payments for containers tied to higher market prices.
Councilmember Painter moved to receive the midyear financial report, adopt staffing-plan changes and approve the recommended revenue and expenditure adjustments documented in Budget Amendment 5; the motion passed on a voice vote.
What’s next: Finance staff will implement the approved adjustments and return future reports if trends change; council members asked for continued monitoring of TOT and other revenue volatility indicators.
