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Council accepts midyear budget update; staff notes reserve levels and several technical adjustments
Summary
Murrieta’s council received a midyear financial report and approved staff’s proposed budget adjustments, including modest sales tax increases, a $222,000 personnel adjustment and a $3.5 million transfer reduction; staff reported an approximately 30% operating reserve.
Murrieta City Council on March 3 accepted the city’s fiscal year 2025‑26 midyear financial report and approved technical amendments to align the operating budget with actual collections and planned expenditures.
Finance Director Javier Caramo told the council the city is monitoring development‑sensitive revenues and that the city continues to “maintain a healthy reserve at approximately 30% of the operating budget.” Staff identified and corrected a formula error in one attachment and proposed adjustments including a roughly $200,000 increase to general‑fund sales‑tax revenue, $150,000 to Measure T sales tax, a $7.4 million increase in miscellaneous revenues (largely timing and receipts reconciliation) and expenditure increases that include $222,000 for personnel related to recently approved position changes.
Finance staff detailed that the general fund had collected about $20.5 million of a projected $78.8 million through the midyear snapshot, and that some revenues (notably sales and property tax) are received on multi‑month lags. In response to council questions the team said the increase in license and permit fee revenue reflected additional single‑family, multifamily and ADU permits; staff also explained that anticipated revenue from AMR system‑enhancement fees has declined because ambulance response performance has improved.
On expenditures staff proposed a net increase in operations and maintenance of $167,000 (including lease costs for a city‑hall annex and emergency repairs at a fleet maintenance facility) and a proposed reduction of transfers by $3.5 million after staff determined that an interfund loan was not required. Staff said the city’s schedule of authorized positions remains stable at 467 full‑time equivalents with internal title adjustments and one net staffing realignment for succession planning.
Council asked clarifying questions about business license collection timing, lease accounting for the annex, and the timing of sales and property tax receipts. After discussion Councilmember DeForest moved to accept the report and to approve the recommended adjustments; the motion passed unanimously, 5‑0.
Staff indicated it will return with the third‑quarter update in May and a year‑end report in December, and that it will bring further adjustments if additional receipts change projections.
