Bell Gardens projects $1.7 million shortfall as city watches card‑room and cannabis revenue

The Bell Gardens City Council on Nov. 10 received a first‑quarter general fund revenue update projecting general fund revenues of $48,354,858 for the 2025–26 fiscal year — about $1.7 million below the amount adopted in June, city financial staff told the council.

Manuel Curio, director of administrative and financial services, said the primary drivers of the projected shortfall are weaker card‑room receipts and lower‑than‑expected transfers from a newly formed cannabis fund. "As part of the city's ongoing review process...we are projecting general fund revenues to come in at 48,354,858 as of June 30th of 2026," Curio said during the presentation.

The staff report used first‑quarter actuals to update projections. Curio said card‑room revenue was forecast at about $17.3 million for the year versus the $19 million assumed in the adopted budget, using the first‑quarter average to temper earlier assumptions. The city manager told council that temporary construction activity at the card room and planned investments such as solar canopies were factors in monthly volatility.

Curio also updated cannabis revenue estimates. The cannabis fund balance was about $400,000 as of June 30, 2025, and staff projected that initial provider community‑benefit payments and operating fees could bring the fund near the previously modeled levels. However, Curio said one expected development agreement lapsed and openings for some operators will be delayed; those changes reduce the amount available for transfer to the general fund. "This would result in a projected net reduction of about 760,000 in operating transfers in," he said.

Council and staff framed the numbers in the context of the city's revenue mix: the city still relies on a relatively large but declining share of revenue from card‑room activity. City staff recommended continued close monitoring, contingency planning with the card‑room JPA, development of new revenue opportunities and consideration of a proposed 0.25% local sales tax measure that staff estimates could raise roughly $1.3 million annually.

Staff also flagged legal and regulatory risks that could affect future card‑room receipts. The council was told that a tribe‑filed lawsuit authorized under SB549 was dismissed by superior court in October; no appeal had been filed as of the meeting. Staff further noted proposed Attorney General rule changes that, if adopted, could slow the pace of certain games and depress revenue.

As near‑term next steps, staff will continue monthly monitoring, prepare contingency options for the council and pursue related items that could affect the fiscal picture, including retail cannabis implementation and a potential RFP process related to the city water system.

The council voted 5‑0 to receive and file the revenue update; no policy action was taken at the meeting.