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November 18, 2025
ITEM TITLE
Long-Term Financial Plan: Accept the General Fund Long -Term Financial Plan – Fiscal Years 202 7-2036 Report
Report Number: 25-0212
Location: No specific geographic location
Department: Finance
G.C. § 84308 Regulations Apply: No
Environmental Notice : The activity is not a "Project" as defined under Section 15378 of the California Environmental Quality Act State Guidelines. Therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
Recommended Action
Accept the General Fund Long-Term Financial Plan – Fiscal Years 2027-2036 report.
SUMMARY
The City of Chula Vista Fiscal Years 2027 – 2036 General Fund Long-Term Financial Plan (“LTFP”) serves as a long-range fiscal planning tool to identify financial trends, project budgetary surpluses or shortfalls, and encourage discussion to proactively address the City’s long-range needs. The goal of the LTFP is to assess the City’s ability over the term of the plan to maintain current or expand service levels; preserve the City’s long term fiscal health; and strategically increase the City’s reserve funds to meet the City’s reserve policy. The LTFP report serves as a guideline for the development of the fiscal year (“FY”) 2026-27 General Fund budget.
Information related to the City’s non -General Fund funds can be found on the City’s website within the FY 2025-26 Adopted Budget (chulavistaca.gov/budget).
ENVIRONMENTAL REVIEW
The Director of Development Services has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity is not a “Project” as defined under Section 15378 of the State CEQA Guidelines because the proposed activity consists of a governmental fiscal/administrative activity which does not result in a physical change in the environment . T herefore, pursuant to Section 15060(c)(3) of the State CEQA Guidelines, the activity is not subject to CEQA.
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BOARD/COMMISSION/COMMITTEE RECOMMENDATION
Not applicable.
DISCUSSION
The City of Chula Vista’s General Fund LTFP for Fiscal Years 2027-2036 serves as a long-range fiscal planning tool to identify financial trends, identify projected budgetary surpluses or shortfalls, and encourage discussion to proactively address the City’s long -range needs. The LTFP focuses on baseline revenues and expenditures that are essential for the City to achieve the City’s strategic goals over the next ten years. These goals include:
Providing the highest level of municipal services based upon available resources; Maintaining safe and appealing neighborhoods;
Providing funding for City infrastructure; and
Continuing to expand the City’s economic development and financial base.
In development of the LTFP projections, City staff reviewed historical budgeted and actual financial figures, reviewed current data, and researched current financial trends. City staff reviewed federal data (U.S. Bureaus of Economic Analysis, Labor Statist ics; Federal Reserve; U.S. Treasury), the UCLA Anderson Economic Outlooks, HdL (City sales tax consultant), the San Diego Tourism Authority, and other sources to develop the economic assumptions and growth rates included in the LTFP model and report (Attachment 1).
It is important to emphasize that the LTFP is not a budget. The LTFP does not make expenditure decisions or assume revisions to current service levels but rather highlights the need to prioritize the allocation of City resources to ensure the co ntinuation of core City services. The purpose of the plan is to provide the City Council, key stakeholders, and the public an overview of the City’s fiscal health based on various financial and service level assumptions over the next ten years, and to allo w for the discussion of necessary steps to be initiated during the development and implementation of future budgets. The LTFP is intended to look beyond the annual budget cycle, serving as a planning tool to bring a long -term perspective to the budget process. Should projected expenditures exceed projected revenues in any given year, the City Manager will identify steps to mitigate the shortfalls prior to presenting a balanced budget to the City Council for consideration during the annual budget development process.
Summary of Financial Projections
The LTFP forecasts General Fund revenues and expenditures based on current and known conditions, historical performance, economic data, and consultation from subject matter experts. The LTFP basis is the baseline operating revenues and expenditures in the City’s General Fund and includes adjustments to forecasts for revenues and expenditures based on maintaining the City’s service levels; anticipated new revenue streams and new projected costs (e.g., new facilities or financing); and other planned commitments.
Based on projections within the LTFP, overall General Fund revenues and expenditures are anticipated to increase throughout the ten -year Plan period. In some fiscal years, revenues are expected to exceed expenditures, resulting in an operating surplus; in others, expenditures are expected to exceed revenues, resulting in an operating deficit.
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Based largely on population growth and new development, continued growth in revenues and expenditures is anticipated throughout the LTFP period; staff employed a conservative yet reasonable approach in developing the projections based on City policy. Uncertainty related to several key factors impacting the economy (discussed in the Economic Overview of the report in Atta chment 1) has led staff to moderate revenue and expenditure growth expectations. It should be noted that these projections do not incorporate any economic downturn during the LTFP period, which would likely negatively impact the LTFP projections.
Projections within the LTFP will be monitored by staff and re-evaluated based upon future economic activity and available data.
While service levels are maintained in the LTFP model, growth in expenditures is anticipated to outpace the growth in revenues from Fiscal Year 2027 to Fiscal Year 2031, particularly due to personnel and insurance costs, all to be discussed in the Major Revenues and Expenditures and Capital Expenditures sections of t he LTFP report. As shown on the summary table below , the overall G eneral Fund shortfall is projected to fluctuate beginning in FY 2027 at approximately $5. 3 million and ending in FY 2031 at approximately $2.2 million. A General Fund surplus is projected beginning in FY 2032 at approximately $0. 02 million and continuing through FY 2036 at $6.5 million.
The following table presents the 10-year financial forecast for the General Fund for FY 2027 through FY 2036.
Additional information related to forecasted revenues and expenditures is provided within the attached report (Attachment 1).
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General Fund Long Term Financial Plan
FY 2027 – FY 2036 (in millions)
Adopted
FY
2026
FY
2027
FY
2028
FY
2029
FY
2030
FY
2031
FY
2032
FY
2033
FY
2034
FY
2035
FY
2036
Revenues
Major Revenues (1) 244.7 250.5 261.3 272.5 283.0 294.0 304.6 314.4 326.0 337.9 349.7 Other Revenues (2) 60.9 66.2 67.6 68.1 70.2 71.0 72.9 74.7 76.6 78.6 80.7 Total General Fund
Revenues $305.6 $316.7 $328.9 $340.6 $353.2 $365.0 $377.5 $389.1 $402.6 $416.5 $430.5 Year-over-Year
Change - 3.6% 3.8% 3.5% 3.7% 3.3% 3.4% 3.1% 3.4% 3.5% 3.3% Expenditures
Personnel
Expenditures (3) 161.8 171.7 177.8 183.2 187.6 191.9 197.0 202.2 207.5 213.0 218.7 Non-Personnel
Expenditures (4) 143.8 150.3 157.6 161.7 169.4 175.3 180.5 185.7 193.1 200.0 205.2 Total General Fund
Expenditures $305.6 $322.0 $335.4 $345.0 $357.0 $367.2 $377.5 $387.9 $400.6 $413.0 $423.8 Year-over-Year
Change - 5.4% 4.2% 2.8% 3.5% 2.9% 2.8% 2.8% 3.3% 3.1% 2.6% General Fund
Surplus/(Deficit) $ 0.0 $ (5.3) $ (6.5) $(4.4) $(3.8) $(2.2) $0.0 $1.3 $1.9 $3.5 $6.5 Surplus/(Deficit) as
a % of Budget - (1.6)% (1.9)% (1.3)% (1.1)% (0.6)% 0.0% 0.3% 0.5% 0.9% 1.5% Footnotes:
(1) Major Revenues reflect the total of the following revenue categories: Property Tax, Property Tax in lieu of VLF (VLF), Sales Tax, Measure P Sales Tax, Measure A Sales Tax, Franchise Fees, Transient Occupancy Tax (TOT), and Utility Users’ Tax (UUT). (2) Other Revenues reflect the total of the following revenue ca tegories: Development Revenue, Licenses and Permits, Fines, Forfeitures & Penalties, Use of Money and Property, Other Local Taxes, Police Grants, Other Agency Revenue, Charges for Servi ces, Interfund Reimbursements, Other Revenue, and Transfers from Other Funds. (3) Personnel Expenditures reflect the total of the following expenditure categories: Personnel Services, Health Insurance, Retirement (PERS).
(4) Non-Personnel Expenditures reflect the total of the following expenditure categories: Supplies and Ser vices, Other Expenses, Transfers Out, Internal Services, Utilities and Other Expenditures Category (Other Capital, Non -Cip Projects Expenditures and CIP Project Expenditures).
LTFP Report Outline (Attachment 1)
The LTFP report begins with summary financial projections for the ten-year term of the Plan, followed by an overview of the current economic environment; key assumptions in the model; and highlights on major revenues and expenditures. The LTFP provides context on capital expenditures, outstanding Cit y debt, and reserve levels. Based on the input and discussions from the City Council and the public during public hearings, City staff will gather additional information and develop recommendations to address future budget shortfalls during the City’s budget development process.
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DECISION-MAKER CONFLICT
Staff has reviewed the decision contemplated by this action and has determined that it is not site-specific and consequently, the real property holdings of the City Council] members do not create a disqualify ing real property-related financial conflict of interest under the Political Reform Act (Cal. Gov't Code § 87100, et seq.).
Staff is not independently aware, and has not been informed by any City Council[member, of any other fact that may constitute a basis for a decision-maker conflict of interest in this matter.
CURRENT-YEAR FISCAL IMPACT
There is no current -year fiscal impact related to acceptance of the General Fund LTFP Fiscal Years 2027 - 2036 Report.
ONGOING FISCAL IMPACT
Staff will monitor and incorporate impacts to the General Fund LTFP in future quarterly budget monitoring reports to the City Council.
ATTACHMENTS
1. General Fund Long-Term Financial Plan – Fiscal Years 2027-2036 Staff Contact: Adrian Del Rio, Assistant Director, Finance Department Sarah Schoen, Director of Finance/Treasurer