Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Municipal Finance topic
No spam. Unsubscribe anytime.
Gilroy updates budget forecast: police overtime and service-cost increases offset by reserves and Recology fees
Summary
City staff presented Q3 adjustments and an updated general-fund forecast showing a near-term shortfall offset by fund balance and an assigned pension trust; Council approved position-control additions funded by a Recology implementation fee and several budget amendments including purchase authority for a reserve fire engine.
Finance staff told the council on June 15 that current Q3 results and known cost increases require modest adjustments to FY26 and FY27 budgets while the city proceeds with its biennial budget update.
Key items: Finance Director Cindy Murphy told council police overtime is trending about $500,000 over budget due to vacancies filled with overtime and asked council to appropriate additional funds for FY26. Staff also requested a supplemental appropriation to fund a reserve fire engine purchase up to $150,000 (the council authorized procurement steps), and to add three positions to the position-control list funded by the expanded Recology franchise implementation fee (a management analyst and two public-works maintenance positions).
Forecast and reserves: The updated general-fund forecast shows a small negative operating margin for FY26 and a larger shortfall in FY27 driven by lower estimated UUT receipts, deferred TOT from a delayed hotel, and softer building-permit revenue. Staff recommended covering near-term shortfalls with existing fund balance and using an assigned pension trust starting FY28 if necessary. Council approved the recommended position-control updates and budget amendments (roll-call approvals recorded).
What council approved: motions to update the FY26/FY27 position-control list, adopt the requested budget amendments for both fiscal years, and authorize the city administrator to bid for a reserve fire engine with purchase authority up to $150,000 were all approved by recorded vote.
Next steps: Staff will complete the year-end report and bring forward longer-term adjustments during the upcoming biennial budget process (kickoff January 2027).
