Title
Fiscal Year (FY) 2025/26 Budget Update and FY2026/27 Budget Development Process
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FileID
File ID: 2026-00578
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Location
Location: Citywide
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Recommendation
Recommendation: Review, comment, and provide direction.
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Contact
Contact: Peter Coletto, Director, (916) 808-5416, pcoletto@cityofsacramento.org; Mirthala Santizo, Budget Manager, (916) 808-5078, msantizo@cityofsacramento.org; Department of Finance
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Presenter
Presenter: Peter Coletto, Director, (916) 808-5416, pcoletto@cityofsacramento.org; Mirthala Santizo, Budget Manager, (916) 808-5078, msantizo@cityofsacramento.org; Department of Finance
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Attachments
Attachments:
1-Description/Analysis
2-Presentation
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Description/Analysis
IssueDetail
Issue Detail: As the City prepares for the upcoming budget cycle, the mid-year forecast shows the City continues to be in a structural deficit with a budget gap of $66.2 million projected for FY2026/27 that continues to grow in the future years of the forecast. This is not due to an economic downturn but is a fundamental imbalance between City expense growth and revenues. While the current fiscal year remains balanced, the proposed budget commitment of remaining resources will support financing potential additional current year costs associated with labor negotiations as well as closing the FY2026/27 projected budget gap.
Fiscal Year 2025/26 Update
Based on citywide revenue performance throughout the first five months of FY2025/26, staff recommended several revenue adjustments resulting in a net increase of $2.9 million, as reflected below:
The General Fund will also have $0.9 million in reduced expenses associated with lower Cannabis Business Operations Tax revenues as the Measure L contribution to the Children's Fund will be lower. Overall, this results in $3.8 million in additional projected General Fund balance for the current fiscal year. The five-year forecast has been updated to reflect the citywide Gener...
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