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Benicia adopts two-year budget; staff warn water and wastewater shortfalls could require rate action
Summary
Council adopted a balanced general fund biennial budget for FY25-26 and FY26-27; staff and council discussed enterprise fund shortfalls in water and wastewater and plans for a 2026 rate study and use of fund balance to close gaps.
City budget presenter Miss Thorson summarized the proposed biennial budget, describing it as balanced with respect to the general fund and informed by months of subcommittee and public discussion. Finance staff said the all-funds budget shows larger expenses than revenues in some enterprise funds and that the city plans to use portions of fund balance and scaled-back capital projects to manage near-term shortfalls.
Miss Thorson told the council the proposed budget "is balanced with respect to the general fund revenues and expenditures" while staff answered questions about enterprise fund shortfalls and an upcoming rate study in 2026. Finance staff noted that water and wastewater enterprise funds are the primary drivers of the all-funds imbalance. Council approved the biennial budget on a roll-call vote and asked staff to continue monitoring enterprise fund pressures, including potential impacts if a major local industrial payer (Valero) reduces payments or closes.
