Pasadena
Continued Public Hearing for the Presentation
and Adoption of the Fiscal Year 2025-26
Operating Budget
Matthew Hawkesworth
Finance Director
City Council Meeting – Item 14
June 16, 2025
2 General Fund – Proposed FY 26
December 2024 Proposed FY 25-26
Tax Revenues $274,585,826 $273,875,007
Other Revenues 56,308,747 58,280,513
Contributions/Other Funds 20,140,438 30,640,438
Total Revenues 351,035,011 362,795,958
Personnel 228,380,604 231,753,822
Debt Service 12,323,966 12,323,128
Contrib. to Other Funds 14,637,895 14,427,375
Other Expenses 100,845,349 102,952,928
Total Expenses 356,187,814 361,457,253
Operating Income/(Loss) (5,152,802) 1,338,705
General Fund Proposed Changes
Fire:
$100k – Increased uniform costs
$200k – Increased Turnout/PPE costs
$303k – PORT Firefighter Funding – Expiring grants
$167k – Partial year of 1 new Battalion Chief FTE
Public Health:
$255k - Health Officer – 0.75 FTE
3 General Fund Proposed Changes
Public Works:
$116k – Partial funding of three FTEs also funded by CIP or Refuse funds. Includes a Code Compliance Officer,
Management Analyst 1 reclassification from part-time
Administrative Specialist, and one Engineer for Measure R projects in CIP.
$52k – Increased Forestry and Graffiti supplies/PPE costs City Attorney - CPOC:
$25k – Increase to new IPA contract
4 5
General Fund – Proposed FY 26
Proposed FY 25-26
Tax Revenues $273,875,007
Other Revenues 58,280,513
Contributions/Other Funds 30,640,438
Total Revenues 362,795,958
Personnel 231,753,822
Debt Service 12,323,128
Contrib. to Other Funds 14,427,375
Other Expenses 102,952,928
Total Expenses 361,457,253
Proposed Changes 1,218,000
Operating Income/(Loss) 120,705
6 General Fund by Department per Resident
Percentage of General Fund Operating Exp.
FY 26 FY 19
City Attorney 3.60% 2.80%
City Clerk 1.04% 1.16%
City Council 1.03% 1.02%
City Manager 2.47% 2.17%
Debt Service 3.38% 5.52%
Finance 4.55% 4.38%
Fire 20.31% 19.52%
Housing 0.81% 0.53%
Human Resources 1.69% 1.82%
Parks, Recreation & Community Svcs. 8.21% 4.49%
Libraries & Information Services 3.53% 4.68%
Other Non-Departmental 1.77% 1.56%
PCAC Transfer 0.30% 0.37%
PCOC TOT Transfer 3.49% 4.26%
Planning & Community Development 2.53% 3.13%
Police 30.55% 31.38%
Public Health 0.76% 0.00%
Public Works 4.60% 8.76%
PUSD Transfer 3.03% 0.00%
RBOC Transfer 0.00% 0.00%
Transportation 2.35% 2.46%
100.0% 100.0%
OPPORTUNITY FOR ONE-TIME REVENUE
AND USES
FY 2026 Recommended Operating Budget
7 Proposed One-Time Expenditures
Fire:
$200k - Purchase/outfit vehicle for new Battalion Chief PRCS:
$200k - Replace outdated equipment outside of the
equipment replacement schedule
Housing:
$228k - Offset Community Development Block Grant
(CDBG) funding shortfall for MASH program until program can be re-evaluated
$75k - Fund Housing Rights Center, no longer eligible for CDBG8
Proposed One-Time Expenditures
Public Health:
$160k – Fund Program Coordinator II – PORT & Violence Intervention, previously grant funded
$300k – Increased funding of overhead not covered by
grants
$150k – Health Records System replacement grant match Police:
$72k – Equipment to establish fleet repair at station 9 Proposed One-Time Expenditures
Public Works:
$135k – Additional funding for tree planting/watering $280k – Hot Asphalt Truck for Pothole Repairs
Planning:
$200k – Eaton Fire contract services for rebuild assistance Economic Development:
$200k – 450 N. Lake process and Strategic Plan
implementation
10 Proposed One-Time Expenditures
Capital:
$4.3m – Street Resurfacing
Also add $775k from SB1 revised estimates
$2.1m – PD Ruggedized Laptop Replacements for
Vehicle MDTs
Reduced purchase cost by $500k
Annual cost for licensing and replacement plan
estimated at $850k starting FY 2027
$1.5m – PD Dispatch Console Replacement
11 FEDERAL FUNDING AT RISK
FY 2026 Recommended Operating Budget
12 Federal Funds at Risk
⬗ Section 8 Housing Vouchers – Proposed reduction of 43% ⬗ Turn program into a block grant administer by states
⬗ Establish two-year time limits on rental assistance
⬗ FY 2025 Allocation - $18,760,256
⬗ FY 2026 Proposed - $10,693,345
⬗ Section 108 Loan Guarantees – Proposed reduction of 100% ⬗ City has an outstanding loan that is repaid through CDBG funds. ⬗ Annual debt service of $420,000
⬗ Debt Service reserve of $440,000
⬗ Loan matures in 2035
13 Federal Funds at Risk
⬗ Emergency Solutions Grant (ESG), Housing Opportunities for Persons with AIDS (HOPWA), and Continuum of Care (CoC) – Proposed reduction of 13%
⬗ Consolidate three grant programs
⬗ Establish two-year time limits on rental assistance
⬗ ESG: FY 2026 allocation - $161,696
⬗ HOPWA: FY 2026 allocation - $298,830
⬗ CoC: FY 2026 allocation - $6,489,316
⬗ Reductions proposed to begin in FY 2027
14 Federal Funds at Risk
⬗ HOME Investment Partnership – Proposed reduction of 100% ⬗ FY 2026 allocation - $680,157
⬗ Reductions proposed to begin in FY 2027
⬗ Community Development Block Grant (CDBG) – Proposed
reduction of 100%
⬗ FY 2026 allocation - $2,147,455
⬗ Reductions proposed to begin in FY 2027
15 Federal Funds at Risk
⬗ Epidemiology and Laboratory Capacity (ELC Supplemental) – Proposed reduction of 100%
⬗ FY 2026 allocation - $994,794
⬗ Proposed termination effective March 24, 2025 (temporary restraining order issued March 31, 2025)
⬗ Supports infectious disease control and surveillance including healthcare associated infection prevention
⬗ Public Health Emergency Preparedness (PHEP) – Proposed 100% elimination
⬗ FY 2026 allocation $230,372
⬗ Additional $691,116 through June 2029.
⬗ Supports public health emergency preparedness and response activities including staff exercise and training.
16 Federal Funds at Risk
⬗ Mental Health Awareness Training (MHAT) – Proposed reduction is unclear
⬗ FY 2026 allocation - $124,213
⬗ Support for mental health first aid and community resiliency model training to enhance city staff and nonprofit partner ability to identify mental health concerns in community members and refer them to appropriate resources.
⬗ Foothill Workforce Development Board – Proposed reduction of at least 30% for Department of Labor grants.
⬗ FY 2026 allocation of total grants - $3.64 million
⬗ Reductions proposed would begin in FY 2027
⬗ Turn program into a block grant administer by states
17 Federal Funds at Risk
⬗ City has more than $30 million in outstanding loans through the CDBG and HOME programs.
⬗ No immediate financial impact to program elimination. ⬗ Likely that repayment funds would go to the federal government and not retained by the City for redeployment.
⬗ Police receives several grants for equipment or special enforcement type activities such as DUI Checkpoints.
⬗ No funding reductions at this time.
18 Summary of Federal Programs at Risk
⬗ Elimination
⬗ HUD – CDBG and HOME
⬗ HHS – Community Services Block Grant and Low-Income Home Energy Assistance Program
⬗ Water Reclamation Grants
⬗ Economic Development Admin Grants
⬗ Job Corps program
⬗ Community Development Financial Institutions Program
⬗ AmeriCorps
⬗ National Endowments for Arts and Humanities grants
⬗ Institute of Museum and Library Services grants
19 Summary of Federal Programs at Risk
⬗ Significant Reductions
⬗ HUD – Homeless Assistance Programs restricted to emergency-type homeless assistance state block grants, eliminate CoC model ⬗ HUD – Project-based Section 8 Rental Assistance, Tenant-Based Rental Assistance, Section 202 Elderly Housing, Section 811 Disabled Housing
⬗ Workforce Development funding – combine 10 programs into state block grant with 26% reduction
⬗ Drinking and Clean Water Revolving Loan Funds at EPA – convert to state block grant, reduce by 90%
20 FEES AND SUBSIDIES
FY 2026 Recommended Operating Budget
21 Categories to Frame the Conversation
⬗ Fees that were reduced due to COVID impacts and not
increased.
⬗ Fees that provide partial cost recovery.
⬗ Subsidies that are not part of an annual fee schedule. ⬗ Fee waiver policies
⬗ Merchant processing fees
22 Fees Reduced During COVID
⬗ PRCS
23 Fees with Partial Cost Recovery
⬗ Parks, Recreation & Community Services – Prior Recovery Targets ⬗ Building/Plan Check/Planning Fees:
⬗ Planning fees related to Single Family Residential and historic properties, get 50% reduction of all entitlements.
⬗ Initial inspection, presale inspection/completion, STR permits, historic resource evaluation, certificate of appropriateness, and landmark applications are significantly subsidized, sometimes at 100%. 24 Fees with Partial Cost Recovery
⬗ Public Health
⬗ Vital Record fees are set by the State. Those fees only cover about 64% of operating costs.
⬗ Transportation
⬗ PLF Garage Valet Fees on FY 2026 increase list.
⬗ Occupancy-based parking meter rates approved by Council in FY 2025.
⬗ Updated to South Lake, Shopper’s Lane, Playhouse District, and City-owned parking garages have all been adjusted in the past couple of years.
⬗ Reductions or suspensions of fees were put in place temporarily during early part of COVID 19, and for the Eaton Fire.
25 Fee Information
Recent cost of service studies - Fire Dept: EMS fees completed in FY25, Prevention Bureau completed in FY24. Public Health annually adjusts groups of fees.
Future cost of service studies - Finance Dept (False Alarm fees scheduled for FY26), Fire Dept (Prevention Bureau update within next three years)
Departments recognize the need to plan for cost-of-service studies to assess if their current fees are achieving the desired goal of full cost recovery.
26 Subsidies Outside of Fee Schedules
⬗ Fee Waiver Policies
⬗ PRCS provides for waiver of facility rental fees for Pasadena Nonprofits or other government entities.
� Sports Users are the largest discount at more than $1m per year. � Nonprofit Facility Use Rental Fee Waivers. FY 25 - $100k. ⬗ PMC 3.24.030.E – Parks and Public Grounds
⬗ … Th e re sp o n sib le a d m in istra tive o fficia l (PRCS a n d PW Dire cto rs) m a y al l ow free use of any faci l i ty under that person's j uri sdi cti on where the u se r is a lo ca l civic o r p a trio tic o rga n iza tio n . Th e city m a y ch a rge a n y su ch user any i nsurance pol i cy charges pertai ni ng to the use of the premi ses and for ci ty's expenses i n condi ti oni ng or recondi ti oni ng the faci l i ty before or after its use. The city m ay also charge any user direct city staff costs for o p e n in g, clo sin g a n d /o r su p e rvisin g a ctivitie s a t th e fa cility. 27 Subsidies Outside of Fee Schedules
⬗ Youth Sports League Discounts
⬗ Must show 60% Pasadena residents (including PUSD students) on the roster.
⬗ Co-Sponsorship/Fee Waiver eligibility
⬗ 501(c)3 in good standing that provides broad-based community benefit or provides direct services or funds in Pasadena in value at least of what is being waived.
⬗ A community group that provides broad-based community benefit hosting an event that is not for profit.
⬗ A recognized neighborhood association.
28 Subsidies Outside of Fee Schedules
⬗ Merchant Processing Fees (Credit Card Fees)
⬗ Utilities - $2.1m
⬗ Building Permits Fund - $500,000+
⬗ General Fund - $250,000+
⬗ Current transaction limit of $50,000 to use a credit card. ⬗ The City has a contractual cost of 2.65% with merchant processors. ⬗ The City has a contractual cost of $0.50 per transaction for processing e-check or ACH withdrawals.
⬗ More entities, public and private, are passing along merchant fees to the payee when offering e-check or ACH payment as additional payment options.
29