Atwater reviews draft FY 2025–26 budget; staff flag $350,893 structural gap and Measure B spending draws public ire

The Atwater City Council on Tuesday reviewed a draft fiscal year 2025–26 budget that staff said narrows multi‑year gaps but still leaves a structural shortfall of $350,893 in the general fund.

"The total revenues that are estimated is 68.47 million and the total expenditures transfers out is 81.47 million," Finance Director Anna Nicholas told the council during a detailed presentation of revenue assumptions, department budgets and reserve policies. Focusing on the general fund, she said proposed revenues and transfers in total $20.6 million against expenditures of $21.1 million, a $525,000 difference; after $175,000 of one‑time spending is removed the remaining $350,893 is structural.

Nicholas said the city trimmed the gap through conservative revenue estimates and department adjustments, including reductions in some community events and part‑time recreation staff, and by using higher interest earnings and RDA residuals when available. She warned that some costs—including a 16% insurance premium increase and salary and benefit pressures—remain outside the city’s direct control.

The presentation also reviewed the city’s public safety funds. Measure B, Atwater’s public safety sales and use tax, carries a projected sales and use tax estimate of about $5.2 million against budgeted Measure B expenses of roughly $5.9 million; staff said one‑time uses of fund balance account for the difference. The Community Facilities District public safety fund (Fund 5050) was highlighted as outpacing its revenues, with assessments estimated at $721,760 versus $883,000 in projected expenses for officer positions and a CalFire contract; staff said the draft includes a planned transfer from the general fund to cover that gap.

Public comment was extensive and sharply focused on how Measure B dollars have been spent. Linda Dash, a longtime oversight committee member, argued Measure B was intended to support officers and frontline services and criticized expenditures she identified as facility improvements or exercise equipment. "This is a misappropriation of funds. Plain and simple," she said. Other residents asked whether purchases of dispatch furniture and vests took place and sought clearer, earlier notice of non‑routine Measure B spending.

A member of the public also asked about sewer flows from the former Castle base and whether the county’s payments for those flows have fairly covered Atwater’s costs; staff said an interceptor replacement project and additional flow measurement are still underway and that a definitive county reconciliation awaits those results.

Councilmembers asked staff to consider public feedback and to bring clarified budget and capital improvement program documents back to the council. No budget votes were taken at the workshop; staff said the final budget is scheduled for adoption at the June 9 meeting.