Item 24 - Fiscal Year 2026-27 Budget Work Study Session

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Fiscal Year 2026-27 Budget Work Study Session May 19, 2026 Page 2 the draft FY26-27 budget with a focus on maintaining core service levels, preserving operational continuity, and minimizing impacts to residents and employees. The $13 million of proposed balancing measures are detailed in Exhibit 2, and a summary by department follows. Balancing Measure FY 2026-27 Impact Department Reductions: City Manager's Office $279,810 Human Resources $292,770 City Clerk $40,010 Finance $589,890 Public Works $3,386,515 Planning and Building $1,484,960 Parks and Recreation $1,155,010 Community Development $646,590 Library $465,390 Police $2,213,390 Fire $250,000 Other (Credit Card Fee Recovery, Internal Service Charge $733,833 Refinements, and Board and Commission Changes) Supplemental Budget Requests SBRs $610,593 Revenue and Fee Adjustments $2,115,082 Total Balancing Measures $13,042,657 During the May 5, 2026, budget workshop, the City Council provided direction on the use of available one-time resources. Based on this discussion, staff included two options in Exhibit 4 for City Council evaluation prior to final incorporation into the FY26-27 Proposed Budget. Option 1 would provide funding for a potential Washington Square land purchase, and Option 2 includes a series of items to address safety concerns, reduce future City liability, and increase future City revenue. The following sections provide additional detail on select balancing measures and operational adjustments identified in Exhibit 2. Staffing Budget The balancing measures include defunding 21 vacant full-time positions and part-time budget reductions, also detailed in Exhibit 2. The proposed plan for part-time budget reductions is to immediately defund vacant positions, then defund positions that become vacant in the first quarter of FY26-27.