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West Covina adopts balanced FY 2026–27 budget amid debate over ARPA-funded health-department work
Summary
Finance Director Karen Ogawa presented a proposed FY 2026–27 budget the council approved after debate over ARPA funds being used for early work on an eventual municipal health department. Council members pressed for transparency on consultant fees, special-event budgets and assumptions about overtime reductions.
The West Covina City Council approved the proposed FY 2026–27 operating and capital-improvement budget after a detailed presentation by Finance Director Karen Ogawa and extended council discussion about assumptions and restricted ARPA spending.
Ogawa said the proposed budget meets the city’s fiscal-policy target of maintaining at least 18% of general-fund reserves and reflected collaboration across departments, vacancy-filling plans and anticipated revenue growth. She cited projected general-fund revenues of roughly $100 million and highlighted planned capital projects including funding for Station 3 renovations.
Debate focused on the city’s use of American Rescue Plan Act (ARPA) funds for initial work toward establishing a local health department. Councilmember Gutierrez pressed staff on whether the California Department of Public Health (CDPH) had an active application process and whether West Covina was eligible; staff and the acting city manager said the city is in a “holding pattern” awaiting state guidance and that ARPA funds already allocated to the health-department project would need to be spent per federal rules or returned.
Gutierrez also questioned ongoing consultant fees for the health-department effort and asked for a clearer five-year cost estimate for a stand-alone local health department; staff said portions of the ARPA-funded program predate current staff and that the remaining ARPA balance designated for the health-department activity was limited (about $41,000 unspent as presented).
Councilmembers pressed for more transparency about how the budget counts overtime reductions and salary/benefit increases tied to recently approved memoranda of understanding; Finance staff said salary and benefit increases from negotiated MOUs increased personnel costs while planned vacancy fill rates would allow overtime reductions in future years.
Councilmember Contos proposed motions to remove (strike) certain health-department language from budget text; the motion to strike passages related to the health department failed, and the budget was approved by roll call.
What happens next: Staff will finalize budget materials, post the draft for required public notices and present the budget for final procedural actions per the city’s calendar. Staff agreed to provide requested supplemental transparency materials (e.g., event-by-event special-events breakdown) at follow-up meetings.
