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Board weighs modest service increases, training and selective capital as FY25 surplus outpaces planned drawdown
Summary
Finance staff reported a $10.4 million adjusted fund balance for FY25 and recommended budget scenarios; board signaled support for a cautious, modest increase in client services and for using some surplus for one-time shared services or training rather than recurring hires.
Finance staff presented the FY25 wrap-up and available fund-balance calculation, noting a stronger-than-expected revenue year that left the board with more available funds than planned.
Melanie said the adjusted FY25 fund balance totaled $10.4 million. After backing out a three-month reserve of roughly $3.2 million, staff calculated an available fund balance of about $7.2 million. The FY26 budget assumes using $1.9 million of fund balance; once that is accounted for staff said the board would have an estimated $5.3 million above reserves and current budgeted use to draw on for future years.
Melanie described alternative revenue-projection approaches for FY27 and the implications of each: budgeting conservatively (smaller increases) would use more fund balance if revenues normalize while budgeting a higher sales-tax projection could preserve or grow the fund balance. Board members generally favored a middle path — more than flat funding but not an aggressive spend-down — and asked staff to present budget drafts that reflected a modest increase in client services while keeping contingency for capital or building projects.
Members proposed one-time uses for excess funds that would not create enduring obligations: targeted capital grants for providers (used sparingly), increased shared training or an expanded grant-writer service for multiple agencies, and HVAC sensor upgrades or other building-project investments. Staff estimated about $360,000 in currently unallocated funds and an additional roughly $40,000 of unspent first-quarter funds that could be used for midyear allocations; staff proposed repeating last year’s midyear process focused on fee-for-service providers with about $400,000 available.
Ending: Staff will prepare FY27 budget scenarios reflecting moderate revenue growth and options for one-time investments and will open the midyear fee-for-service allocation cycle in April if the board confirms the approach.
