Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Budget topic
No spam. Unsubscribe anytime.
Preliminary budget shows $2.9M general-fund gap; council asks for departmental options
Summary
City finance staff presented a preliminary 2026–27 budget showing roughly $6.0 million in general-fund revenue against $8.9 million in expenditures, prompting council direction to identify cuts, prioritize projects and improve reimbursement and audit processes to address a projected $2.9 million deficit.
City finance staff on Thursday told the Guadalupe City Council the city faces an estimated $2.9 million general‑fund shortfall for 2026–27 and recommended immediate controls and a department-level review to identify savings and revenue options.
"We're bringing in $6,000,000 in total revenues… we're spending $8,900,000. So you have a $2,900,000 deficit," finance presenter Eli Martinez said as he walked the council through a condensed budget worksheet and assumptions.
Martinez identified public safety as the largest cost driver, accounting for roughly 63% of the budget. He flagged multiple pressures including rising medical and benefits costs, planned step increases, and a proposed $250,000 increase for dispatcher services the city receives from a neighboring agency. He and staff also noted delayed audits and reimbursements — including FEMA and other grant claims — that are limiting near‑term liquidity.
The presenter said the preliminary revenue picture includes about $4.7 million from taxes, roughly $225,000 from cannabis tax receipts, and smaller amounts from permits and fees. Martinez said staff will shift enterprise-fund charge methods to allocate staffing costs more directly to the enterprises and will continue to clean up multi-year accounting differences as auditors complete outstanding years.
Council members asked staff for concrete, department-level options to narrow the deficit and pressed for clarity on reimbursement timing and project prioritization. Staff proposed several immediate controls: instituting a purchase-order approval program for purchases above a set threshold beginning July 1, centralizing grant management with a contracted firm to expedite reimbursements, and pausing nonessential construction projects by December to reassess cash flows.
"We have to figure out where we're bleeding," Mayor Julian said, urging a clear list of unavoidable projects and cost drivers so the council can set priorities. City staff said they will return with a master project list, options by department, and suggested structural changes to procurement and grant management.
What’s next: Council requested a follow-up workshop and departmental breakdowns showing required versus discretionary spending and potential savings. Staff said they would present option sets and a proposed special-events and permit framework in coming weeks.
