Item 07 - FY 2025-26 Third Quarter Budget Report and Proposed Appropriation Adjustments

Home Browse Search

FY2025-26 Third Quarter Budget Update and Proposed Appropriation Adjustments June 2, 2026 Page 6 The City uses Neighborly, a cloud-based platform, to maintain electronic application records for prior City-administered rental assistance programs, including ERA and the Eviction Prevention Program. Federal grant requirements mandate that these records be retained for five years after the end of the period of performance (September 30, 2025), or until the final report is submitted to the U.S. Treasury, whichever is later. To ensure continued compliance and access to these records, the City must maintain an annual Neighborly subscription costing $15,480. A portion of this expense will be covered by the $6,277 in accrued interest earnings. The remaining balance, as well as future subscription costs, will be funded through alternative sources. Rental Registry Fund Rental Registry staff continues to manage growing demand for core Rent Stabilization services, including Tenant Petitions, Fair Return Petitions, Public Records Requests (PRRs), outreach initiatives, and general public inquiries. This increased workload has created the need for additional staffing to support program administration and legal services, while also increasing operating costs for materials, office modernization, and upgraded communication infrastructure. Staff anticipates Rental Registry Fee revenues to remain consistent with FY 2024-25 levels at approximately $3.1 million. Accordingly, staff is increasing the Rental Registry Fee revenue estimate by $700,000 and recognizing $40,000 in late fee revenue, bringing total revised revenues to $3,182,060. To ensure the Rent Stabilization Program can continue delivering high quality and reliable services, staff recommends appropriating these funds for corresponding personnel, operational, and service related expenditures. With these adjustments, the Rental Registry Fund remains balanced. Citywide Vacancy Report The Citywide vacancy rate as of March 31, 2026, remains unchanged at 13%, consistent with the Mid-Year Vacancy Report covering vacancies through December 31, 2025. This stability indicates that overall staffing levels have remained steady throughout the third- quarter reporting period. The March 31, 2026, Vacancy Report is presented in Exhibit 2. ENVIRONMENTAL IMPACT There is no environmental impact associated with this action. FISCAL IMPACT The overall estimated impact to the General Fund is immaterial, resulting in a net increase of $1,566 to the Spendable Fund Balance through June 30, 2026. Exhibit 1 provides a detailed listing of the line-item adjustments to revenue estimates and the corresponding recommended changes to appropriations.