Council adopts FY 2026–27 budget after questions on reserves and fire staffing

The City Council adopted the fiscal year 2026–27 budget on June 16 after a public hearing during which staff reviewed revenue, appropriations and changes from the preliminary budget.

Finance Director Jen Lee summarized the proposed budget: total projected revenue across all funds of $44,151,113 and total projected appropriations of $49,580,335, leaving an estimated variance of $5,429,222. The proposed budget reduces the estimated overall fund balance to $35,337,523. The general fund projection lists $15,491,891 in revenue and $17,104,147 in expenditures, producing a projected general fund deficit of $1,612,256 and an unassigned general fund balance estimate of $4,800,000 after reserves are set aside.

Lee listed seven substantive changes since the preliminary budget, including unfunding a fire battalion chief position, splitting a planned fire vehicle purchase into two smaller purchases (a mini pumper and a Type 1 engine), adding $209,098 for consultant services shared between funds, adding $500,000 to Measure K roadway improvements funded by roadway impact fees, a $1.5 million transfer to a capital replacement reserve, and a $60,000 expenditure for a drinking water revolving fund loan application package.

Council members asked clarifying questions about fund balances, gas tax and SB 1 balances, roadway impact fee allocations, and the schedule for capital replacement planning. A member of the public asked about senior center funding; staff pointed to a line item showing $36,676 and offered follow‑up detail.

After discussion, the council adopted the budget by resolution. The roll call recorded one no vote from Councilmember Stanish, who objected to the decision to leave vacant the battalion chief position; the rest voted yes.

The council directed staff to continue implementing the capital reserve and roadway allocation items and to return with details as budget items are scheduled for implementation.