DATE: January 20, 2026
TO: Mayor and Members of the City Council
President and Members of the Estero Municipal Improvement District (EMID) Board of Directors
VIA: Stefan Chatwin, City/District Manager
FROM: Nate Cruz, Finance Director
DEPARTMENT: Finance
SUBJECT: FY 2025-26 FIRST QUARTER FINANCIAL UPDATE
RECOMMENDATION
It is recommended that the City Council/EMID Board of Directors, by Minute Order, receive and accept the report on the FY 2025-26 First Quarter Financial Update.
EXECUTIVE SUMMARY
The first quarter of the year ended with normal results, with revenues and expenses at levels typical to the end of September. As described in more detail below, staff projects a year-end surplus of $5.4 million, primarily driven by unbudgeted (but partial) VLF reimbursement and unspent staffing resources.
BACKGROUND/ANALYSIS
The table below summarizes General Fund (Funds 001-003) operating results throughout the first quarter.
Projected year-end results were updated as follows:
1. Property Tax In-Lieu of VLF was increased by $1.5 million to account for the unbudgeted (but only partial) shortfall reimbursement from the State.
2. Sales and Use taxes were slightly reduced to reflect the most updated projections provided by our tax consultants.
3. Business License Tax revenues were increased by $200,000 to reflect higher anticipated collections under the BLT Amnesty Program.
4. Interest earnings were increased to account for market rates which remain higher than budget assumptions.
5. Personnel Cost is projected using a straight-line methodology, such that the year- end estimate assumes first quarter staffing costs remain consistent through the end of the year.
This report is intended to provide high level financial information for the City Council, City Departments, and the public. See the attachments for more General Fund details and information on other funds.
Ref
Category Amended
Budget
Actual as of
9/30/25
Projected
Year End $ %
Property Tax (incl. ERAF) 39,956,666 $ 42,044 $ 39,956,666 $ - $ 0% 1 Prop. Taxes in Lieu of VLF 2,680,715 1,564,791 4,180,715 1,500,000 56% 2 Sales Tax 3,992,179 331,575 3,943,179 (49,000) -1%
Transient Occupancy Tax 4,600,000 417,216 4,600,000 - 0% 3 Business License Tax 4,100,000 31,612 4,300,000 200,000 5% Permits 2,721,093 793,041 2,721,093 - 0%
4 Interest 1,713,900 578,565 2,045,032 331,132 19%
Other 6,334,612 1,552,576 6,334,612 - 0%
Total Revenues 66,099,165 5,311,420 68,081,297 1,982,1323% 5 Personnel Cost 40,464,177 9,209,203 36,836,812 (3,627,365) -9% Supplies & Other 25,876,538 8,360,417 25,876,538 - 0%
Total Expenditures 66,340,715 17,569,620 62,713,350 (3,627,365) -5% Net Revenues (241,550) 5,367,947 5,609,497 *
Net Transfers In (Out) (5,000,000) (5,000,000) - 0%
Change to Fund Balance (5,241,550) 367,947 5,609,497 *
Beginning Fund Balance 71,304,469 71,304,469
Ending Fund Balance66,062,919 71,672,416
% of Next Year's Expenses 98.0% 106.3%
*Indicates variance percentage is not mathmatically meaningful due to one of the compared figures being negative.
VarianceFY 2024-25
FISCAL IMPACT
There is no fiscal impact associated with the acceptance of this report.
CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Staff Empowerment and Operational Excellence
ATTACHMENTS:
Attachment 1 - Changes in Fund Balances
Attachment 2 - Budget vs. Actual and Prior Year’s Revenues Attachment 3 - Budget vs. Actual and Prior Year’s Expenditures