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Calabasas council adopts FY2025–26 budget with cost reallocations, limited reserve use
Summary
The City Council approved the fiscal 2025–26 budget after adopting a cost-allocation plan that shifts about $1.6 million in expenses from the general fund, enacting $375,000 in operational cuts and authorizing roughly $98,000 from reserves to close a near-$100,000 gap. Council also prioritized capital projects and directed staff to study new revenue options.
The Calabasas City Council on June 11 approved the city's fiscal year 2025–26 budget, endorsing a package of cost reallocations, spending cuts and a modest draw from reserves intended to close a remaining shortfall of about $100,000.
City Manager Kinden Meek told the council the draft budget began with roughly $30 million in revenues and $32 million in expenses, producing about a $2.1 million deficit. The budget committee recommended a three-part approach: implement a cost-allocation plan to distribute roughly $1.6 million of personnel and operating costs to other funds; identify $375,000 of discretionary operational savings; and, as a last resort, authorize use of approximately $98,465 of general fund reserves. Council voted 5-0 to adopt the plan.
Why it matters: Council members said the package narrows a multi-year structural gap while preserving core services and leaving reserves to meet emergencies. Meek said the council's action also frees $500,000 to move into a Section 115 trust to help address long-term pension and post-employment liabilities.
Key elements and tradeoffs - Cost allocation: Staff said the revised allocation distributes a greater share of support costs (legal, insurance, landscaping and some personnel) to non-general funds, yielding an estimated $1.6 million savings to the general fund. - Operational cuts: The budget committee identified roughly $375,000 in smaller reductions and program adjustments, including modest changes to event spending and negotiated contract savings. Staff reported an additional $60,000 in cuts found after the committee's work. - Reserves and capital: With the measures, the council authorized a limited reserve draw (about $98,465) and prioritized one capital project this year (founders hall AV equipment, ~$250,000) while deferring larger capital work pending grant searches and an energy/solar retrofit study.
Council discussion focused on how to balance near-term savings with long-term needs. Several members urged preserving security staffing at city facilities and asked staff to explore allocating a share of those security costs to facilities that directly benefit (for example, the library and the tennis/swim center). Staff agreed to return with a site-specific allocation of security hours and cost before implementation.
The council directed staff to return in August with a report on new revenue options, including but not limited to hotel (transient occupancy) tax adjustments, sales or business taxes, and other mechanisms to close structural revenue shortfalls.
What comes next: Staff will implement the cost-allocation adjustments, pursue contract savings where feasible, return with refined allocations for security and landscape costs, and prepare a new-revenue options report for council direction.
At the June 11 meeting the budget adoption passed on a 5-0 voice vote (motion by Council Member Shapiro; second by Council Member Albert).
