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Pleasanton council adopts midterm budget update and revised five‑year water CIP
Summary
The council unanimously approved a midterm update to the FY 2026–27 operating and capital budgets and a revised five‑year water capital improvement plan, relying on about $6 million in one‑time balancing resources and targeted transfers while warning the structural deficit persists.
Pleasanton’s City Council unanimously approved a midterm update to the fiscal year 2026–27 operating and capital budgets and a revised five‑year water capital improvement plan on May 19.
The finance director said the citywide operating budget is projected to increase by about $8 million to roughly $265 million, with general fund revenues forecast lower overall: “Property tax is projected to decrease by about $1,900,000 compared to the adopted budget,” Finance Director Susan Hsieh said. Staff recommended using approximately $6 million in one‑time resources and targeted transfers, including a $500,000 contribution to the fire apparatus replacement fund, to balance the update.
The midterm update reflects adjustments across enterprise and internal service funds, changes to project schedules and cost estimates, and an anticipated $250,000 surplus for FY 2027, staff said. The presentation noted an ongoing infrastructure funding gap identified in the city’s asset management work; staff described a roughly $44 million annual need for infrastructure investments that exceeds current general fund capacity.
Council members questioned the assumptions driving revenue projections, the role of reserve draws and pension trust withdrawals, and the midterm reliance on one‑time funding. Vice Mayor Gaydos said the midterm update is “status quo” relative to prior forecasts, while Councilmember Testa stressed that one‑time measures do not resolve long‑term structural deficits.
Councilmember Testa moved to adopt staff’s recommendation; the motion was seconded and passed by unanimous roll call. Council and staff said they will pursue additional policy and revenue options in the next two‑year budget cycle to address longer‑term gaps and pension‑related cost pressures.
The council’s action accepts the midterm operating and capital adjustments and approves the water capital improvement plan revisions; staff will return with implementation details and any required interagency agreements.
