110 E. Main Street Los Gatos, CA 95030 ● (408) 354-6832 www.losgatosca.gov
TOWN OF LOS GATOS
COUNCIL AGENDA REPORT
MEETING DATE: 10/06/2026
ITEM NO: 8
DESK ITEM
DATE: October 6, 2026
TO: Mayor and Town Council
FROM: Chris Constantin, Town Manager
SUBJECT: Receive the July 2026 Expenditure and Revenue Reports and Approve the Monthly and Quarterly Reporting Formats
REMARKS:
Attachment 7 contains staff’s presentation. Attachment 8 contains public comment.
Attachments:
1. Year-to-Date Budget Report Expense by Fund for July
2. Year-to-Date Budget Report Expense by Fund and Category for July
3. Year-to-Date Budget Report Revenue by Fund for July
4. Year-to-Date Budget Report Revenue by Fund and Category July
5. Monthly Reporting Format – July
6. Quarterly Reporting Format – July
Attachments Received with this Desk Item:
7. Staff Presentation
8. Public Comment
Monthly Revenue and Expenditure
Reports (July 2026)
Town Council Meeting
10/06/2026
ATTACHMENT 7
Agenda
1. Reporting Overview
2. Analysis Overview
3. July Snapshot
4. All Funds Review
5. General Fund Review
6. Salary and Benefit Analysis
7. Conclusions and Recommendations
Reporting Overview
Annual Average Growth
Rate (AAGR)
• Reports Included (Revenue and Expense)
• By Fund
• By Fund and Category
Finance Commission and Future Reporting
Annual Average Growth
Rate (AAGR)
• Report Goals, Finance Commission Feedback and Future
Monthly and Quarterly Reporting
• New reports for enhanced transparency and better internal management
• More detailed reports went to Finance, but feedback was that it was too much information
• Staff is presenting a shorter version for Council’s review and consideration
• Future Monthly Reports will be on consent, Quarterly Reports will be a presentation under Other Business Items
Analysis Overview
Annual Average Growth
Rate (AAGR)
• Year-End and New Fiscal Year Considerations
• Accruals, Receivables and Encumbrances
• Reporting Formulas
• Expenditures PCT Used = (YTD Expended + Encumbrances)/Revised Budget)
• Revenues PCT COLL = Actual YTD Revenue/Revised Est Rev • Straight-line, Trend and Payroll
• Straight-line assumes 1/12, or 8.3% collected/spent
• Trend – look at the same period for three years to establish a range • Payroll
• % of payrolls in a period for salaries to establish a baseline or • 1/12 or 8.3% for benefits because these are paid monthly, not by pay period What the July Reports Tell Us
A consistent early view of budget-to-actual performance.
15.1%
All Funds expenditures used
8.0%
General Fund expenditures used
1.4%
General Fund revenue collected
5.5%
Salary/benefit utilization
OVERALL SPENDING IS
GENERALLY CONSISTENT WITH
HISTORICAL JULY PATTERNS.
GENERAL FUND
EXPENDITURES ARE BELOW
THE 8.3% STRAIGHT-LINE
BENCHMARK AND BELOW
RECENT JULY TRENDS
GENERAL FUND REVENUE
COLLECTION IS LOW FOR JULY,
LARGELY REFLECTING TIMING
AND ACCRUAL PATTERNS
SEVERAL INDIVIDUAL
FUNDS/CATEGORIES
WARRANT MONITORING, BUT
THE REPORT IDENTIFIES NO
TOWNWIDE EXPENDITURE OR
REVENUE CONCERNS.
All Funds Expenditures
July utilization is essentially in line with the most recent historical July.
21.5%
FY 2023-24
30.7%
FY 2024-25
15.0%
FY 2025-26
15.1%
FY 2026-27
• FY 2026-27 July utilization: 15.1%, compared with 15.0% in FY 2025-26. • High individual-fund utilization is concentrated in a small number of funds and is not indicative of overall Townwide spending pressure.
All Funds Revenues
July utilization is essentially in line with the most recent historical July.
5.6%
FY 2023-24
2.4%
FY 2024-25
0.9%
FY 2025-26
1.6%
FY 2026-27
• FY 2026-27 July utilization: 1.6%, compared with 0.9% in FY 2025-26. • Decreases in revenue collected is driven by budgeting closer to prior year actuals and a delay in community development revenue reporting between systems.
General Fund: Expenditures
General Fund combines Funds 111, 121 and 732 for the trend analysis.
8.0%
FY 2026-27 July utilization
8.3%
Straight-line benchmark
9.8%
FY 2025-26 July utilization
9.3–10.7%
Prior 3-year range
Parks & Public Works: 16.4% — the highest General Fund department utilization reflects encumbered contractual costs.
Town Attorney: 36.0% — primarily reflects encumbered contractual costs.
Overtime: 4.5% and salaries: 4.8% — both below the July pay-period benchmark.
Contracts: 33.6% and utilities: 23.5% — elevated primarily because of annual/timing-related charges and encumbrances.
General Fund: Revenue
July revenue collection is 1.4%; timing is a significant factor in early-year results.
1.4%
FY 2026-27 July collected
8.3%
Straight-line benchmark
1.6–5.3%
Prior 3-year July range
General Fund revenue combines Funds 111, 121 and 732.
Property tax, sales tax, TOT and franchise fee activity is affected by accrual and collection timing early in the fiscal year.
Town Services and Licenses & Permits are collecting at 4.1% and 3.5%, respectively, driven by delayed reporting from the planning software
Staff expects several timing-related revenue items to improve with August reporting.
1.6%
FY 2025-26 July utilization
Management Watch List
Items identified for follow-up or continued monitoring.
Storm Basin 2 175.2% Encumbrance exceeds current budget; review budget/PO alignment.
Gas Tax 108.4% Charges not yet processed against an existing PO; August correction expected.
ABAG Town Liability 88.8% High utilization associated with insurance-provider change and lower budget.
Workers Comp 36.3% Above prior-year July level; monitor trend.
IT / Facilities 48.2% / 30.4% Higher early-year activity reflects annual contracts/utilities and timing.
Vacancy Savings & Personnel Costs
Salary and benefit utilization is below the full-month 8.3% and 5% benchmarks.
Benchmark/July
5.0%/4.8%
Salaries
Benchmark/July
5.0%/4.5%
Overtime
Benchmark/July
8.3%/6.3%
PERS
Benchmark/July
8.3%/7.2%
Medical/Other Benefits
• The adopted budget assumes approximately 4.6% salary vacancy savings. • Salary and overtime utilization are below the approximately 5.0% July pay-period benchmark. • PERS, medical, and other benefits are below the 8.3% monthly benchmark used for benefit categories.
• July includes a final cash-out and vacation cash-outs that occur 2x per fiscal year. • The dedicated vacancy report was not yet available; staff expect it in the fall.
Key Takeaways
Annual Average Growth
Rate (AAGR)
• Overall financial activity is generally within historical July patterns. • General Fund expenditures are at 8.0%, below the 8.3% straight-line benchmark and below recent July trends.
• General Fund revenue is at 1.4%; early-year timing and accruals materially affect July collection percentages.
The July reports establish an early baseline for ongoing monthly monitoring.
Monthly vs. Quarterly Reporting
Annual Average Growth
Rate (AAGR)
Monthly Reporting Format –
• Provides high-level analysis by fund
type and breaks out percent
collected or expended by year.
• Provides detailed analysis by fund,
• with a detailed by category analysis
for the General Fund and vacancy
savings.
The July reports establish an early baseline for ongoing monthly monitoring.
Quarterly Reporting –
• Most detailed analysis by fund,
• General Fund analysis by category
and department.
• Provides background information
on the report and uniqueness of
reporting for the period in review.
• This analysis was provided to the
Finance Commission.
Staff Recommendations
Annual Average Growth
Rate (AAGR)
Receive the July 2026 Expenditure and Revenue Reports and approve the Monthly Reporting format and Quarterly Reporting Format.
Questions
From: Gus Who
To: Clerk
Subject: Public Comment Item # 8 for tonight’s Town Hall meeting Date: Tuesday, October 6, 2026 10:40:03 AM
[EXTERNAL SENDER]
To whom it may concern,
There is a very high number of “CONTRACTS” that exceed over 70% in estimated cost ..
Where is the transparency to the public .. and there is a large amount unexplained expense..
Saratoga Agenda meeting has a contact that we may be locked into tomorrow night.. how much legal liability .. as the Town Attorney resigned and there is a lot going on legally wise.. with little to no community time to speak, as even 3 minutes of time allowed was cut to 2 minutes.. to question .. contract(s) that this Town could be locked into a 10 year agreement with ..
Is there a “Special Meeting” Planned if Saratoga signs on to a joint policy?? Is it an equal partnership? .. how much money have we spent to date .. in these numbers to such gamble.. blah, blah, blah .. ?? ATTACHMENT 8
Respectfully Submitted,
Gus Who
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