Fremont City Council Meeting: 11/04/25 07:00 PM
3300 Capitol Avenue Div/Dept: Finance Department
Fremont, CA 94538 Category: Presentations
SCHEDULED
Sponsors:
COUNCIL STAFF REPORT (ID # 5556) DOC ID: 5556
Updated: 10/31/2025 9:17 AM by Dina Lewis Page 1
FISCAL YEAR 2024/25 YEAR-END BUDGET REPORT - Informational Report and Presentation of Year-End Results for FY 2024/25
Contact Persons:
Name: David Persselin
Title: Finance Director
Div/Dept: Finance Department
Phone: 510-494-4631
E-Mail: [email protected]
Executive Summary: The FY 2024/25 Year-End Budget Report provides a summary of actual operating results for the General Fund and identifies appropriation actions taken by the City Manager in accordance with Resolution No. 2024-25, a Resolution of the City Council of the City of Fremont Approving and Adopting a Budget for the Fiscal Year July 1, 2024, through June 30, 2025 (the “Budget Resolution”).
BACKGROUND: The FY 2024/25 operating budget was adopted by the City Council on June 11, 2024, and year-end estimates for General Fund revenues, expenditures, and ending fund balance were included with the FY 2025/26 Proposed Operating Budget presented to the City Council on May 13, 2025.
The audit of the City’s FY 2024/25 financial statements by an independent certified public accounting firm is underway, and the annual comprehensive financial report, including the audited financial statements, is expected to be available by December 31, 2025. To provide the City Council with more timely information about the year just completed, staff has prepared the following information using unaudited amounts. Staff will report on any material audit adjustments at the time the annual comprehensive financial report is provided to the City Council.
DISCUSSION/ANALYSIS:
General Fund Operating Results: General Fund revenues and transfers totaling $263.4 million, are $1.8 million higher than the May estimate of $261.6 million. This is primarily due to higher than anticipated sales tax and interest earnings, partially offset by lower property tax and business tax revenue. The May estimate and actual revenues include the State’s recovery of half of the sales tax it overpaid the City in FY 2022/23, approximately $11.9 million including the impact of reduced revenue from the County pool.
As a separate issue, the California Department of Tax and Fee Administration (CDTFA) informed the City in September that it would be recovering $318,468 of FY 2024/25 misallocated sales tax during the first quarter of FY 2025/26. In follow-up discussions with the CDTFA, City staff learned of several other active investigations that will likely result in additional recoveries. Although the CDTFA could not yet provide an estimate of these additional overpayments, a review of FY 2024/25 remittances by City staff indicates the reduction to FY 2025/26 payments could be in the range of $2-3 million.
Council Staff Report (ID # 5556) Meeting of November 4, 2025 Updated: 10/31/2025 9:17 AM by Dina Lewis Page 2
General Fund expenditures and transfers out of $280.7 million were $3.2 million higher than the May estimate of $277.5 million. The positive variance is attributable to $4.2 million allocated at year-end to increase the City’s workers’ compensation and general liability reserves and pay related expenses in the Risk Management Fund. These amounts are determined by actuarial reports as of June 30, 2025, which are not available until August or September each year.
Total actual expenditure and encumbrance savings slightly exceeded the $21.2 million estimate included in the final budget, mostly attributable to savings on fuel costs.
Encumbrances, reflecting the portion of the fund balance that has been contractually obligated but not yet spent, total $1 million.
The difference between sources of $264.9 million and uses of $281.7 million results in a net reserve decrease of $16.8 million from the FY 2023/24 ending balances (a $3.1 million increase to the Contingency Reserve and a $19.9 million decrease to the Budget Uncertainty Reserve). From a beginning balance of $24.2 million, the Budget Uncertainty Reserve is estimated to finish the year at $4.3 million, $2.4 million lower than in the May estimate.
The table below provides a summary comparing the May estimate and the estimated actual year-end results.
Appropriation Actions by the City Manager: The Resolution adopted by the City Council to implement the annual operating budget also includes authorization for the City Manager to take additional appropriation actions reflecting the following: (1) carryover of unexpended prior-year encumbrances; (2) cost center revenue increases; (3) grant revenue increases; and (4) increased General Fund revenue directly supported by General Fund Council Staff Report (ID # 5556) Meeting of November 4, 2025 Updated: 10/31/2025 9:17 AM by Dina Lewis Page 3
expenditures. Included in the Resolution are requirements to report these actions to the City Council at year-end.
The amount of increased appropriations for FY 2024/25 due to unexpended FY 2023/24 encumbrances was $40.96 million as detailed below.
Fund Type Encumbrances
Governmental Funds
General Fund $ 1,509,813
Capital Projects 18,168,781
Gas Tax 3,884,021
Environmental Services 1,768,316
Development Cost Center 306,235
Miscellaneous 832,060
Subtotal 26,469,226
Reimbursement Grant Funds 10,600,617
Internal Service and Custodial Funds 3,890,673
Total $ 40,960,516
Additional fee, grant, and developer contribution revenue resulted in increased appropriations by the City Manager as summarized in the following table.
Source Amount Recipient Purpose
Fire Impact Fees $ 170,000 Fire Department New Fire Truck Company Federal Grants 102,650 Human Services Family Resource Center Developer Contributions 52,228 Human Services Warm Springs Age Well Center Total $ 324,878
FISCAL IMPACT: None.
ENVIRONMENTAL REVIEW: Action on this item is exempt from the requirements of the California Environmental Quality Act (CEQA) per CEQA Guidelines Section 15378(b), as an administrative and/or fiscal activity that does not involve commitment to a specific project that will result in any significant physical impact on the environment.
ATTACHMENTS: None.
RECOMMENDATION: Accept the report and presentation.