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Proposed Fiscal Year 25-26 Mid-Year Budget Update, Appropriation Requests, <br /> Workforce Changes, and Capital Improvement Program Amendment <br /> March 3, 2026 <br /> Page 2 <br /> The proposed adjustments in this report result in a net decrease of $102,158 in the <br /> estimated Spendable General Fund balance. As discussed in the First Quarter Budget <br /> Report dated December 2, 2025, early economic data and preliminary information from <br /> the City's sales tax consultant indicated that sales tax revenues were trending below the <br /> FY 25-26 adopted estimates. Updated information received since then reflects a similar <br /> trend and will be discussed later in the report. To offset this revenue decrease and <br /> maintain a balanced budget, staff recommends the adjustments outlined in this report. <br /> The recommendations include a targeted revenue adjustment for Planning and Building <br /> fee revenue, which is performing better than expected, and the incorporation of various <br /> mid-year requests, as shown in Exhibit 1. <br /> A General Fund summary as of December 31, 2025 follows. <br /> General Fund ProposedFY2025-26 General Fund Summary Activity through Year <br /> Adjustments <br /> Mid-#men#s Year djus Updated Estimates <br /> 1213112025 <br /> Estimated Beginning Balance at July 11 2025 $ 97,650,804 $ - $ 97,650,804 <br /> Revenue Estimate $ 413.790.950 $ 268.098 $ 414.059.048 <br /> Appropriated Spending $ (424;230;150) $ (369.941) $ (424,600,091) <br /> FY25-26 Contribution to Pension <br /> Stabilization Trust $ {1 000;000} $ - $ (1;000;000) <br /> Estimated Ending Balance at June 30, 2026 $ 86;211;604 $ (101,843) $ 867109,761 <br /> Less_ 18% Reserve' $ 74.482,371 $ 315 $ 74.482,686 <br /> Estimated Spendable Balance $ 11,729,233 $ (102,158) $ 11.627.075 <br /> 'Tire City's 18%reserve policy applies only to annual recurring revenue. Pension Trustee tee revenues arena <br /> considered recurring because the funds are restricted to pension-related activity. PRCSA's revenue recognition <br /> is a one-time event. <br /> The following table illustrates that the General Fund remains balanced after the <br /> recommended Mid-Year Adjustments by breaking out recurring expenditures and <br /> revenues, excluding one-time items. <br /> Updated Estimates Remove One-Time Recurring <br /> Revenue 414,0597.048 (136,348) 413,922,700 <br /> Spending (424,600,091) 10,680,461 (413,919,630) <br /> Net Recurring Available 3,070 <br /> City Council 20 — 2 3/3/2026 <br />