June 24, 2025
Finance Department
DATE: June 24, 2025
TO: Mayor Martinez and Members of the City Council
FROM:
Shasa Curl, City Manager
Nickie Mastay, Deputy City Manager, Internal Services
LaShonda White, Deputy City Manager, Community
Services
Andrea Miller, Director of Finance
Mubeen Qader, Deputy Director of Finance
Antonio Banuelos, Accounting Manager
Jerry Gurule, Accounting Manager
Subject:
Adopt Fiscal Year (FY) 2025-26 Operating Budget and FY
2025-26 to FY 2029 -30 Five -Year Capital Improvement
Plan
FINANCIAL IMPACT: There is no financial impact associated with adopting the Fiscal Year (FY) 2025-26 proposed Operating Budget
and proposed FY 2025-26 to 2029-30 Five-Year Capital
Improvement Plan Budget. The proposed General Fund
revenue budget is $308,553,519 and proposed
expenditure budget is $260,053,519. The FY 2025-26
total proposed Non-General revenue budget is
$266,677,407 and proposed expenditure budget is
$385,394,493.
PREVIOUS COUNCIL
ACTION:
May 6, 2025
June 3, 2025
June 17, 2025
STATEMENT OF THE
ISSUE:
In accordance with the Richmond Municipal Code
Sections 2.61.010 and 2.61.020, the City Manager is
submitting the Fiscal Year (FY) 2025-26 Proposed
Operating Budget and the Proposed FY 2025-26 to FY
2029-30 Five-Year Capital Improvement Plan Budget to
City Council for adoption.
AGENDA
REPORT
June 24, 2025
RECOMMENDED ACTION:
ADOPT resolutions approving: (1) Fiscal Year (FY) 2025- 26 Proposed Operating Budget, and (2) FY 2025-26 to
FY 2029-30 Proposed Five-Year Capital Improvement
Plan Budget – City Manager’s Office/Finance Department
(Shasa Curl 510-620-6512/ Nickie Mastay 510-620-6609/
Andrea Miller 510-620-6790/Mubeen Qader 510-412-
2077).
Budget Development Process
On May 6, 2025, in accordance with Richmond Municipal Code Section (RMC)
2.61.010, the City Manager submitted the first draft of the Fiscal Year (FY) 2025-26 Operating budget, and the draft FY 2025-26 to FY 2029-30 Five-Year Capital Improvement Plan budget. On June 3, 2025, the City Council received the proposed budget presentation during the Budget Study Session. On June 17, 2025, the City Council received an update to the budget, and a presentation of the General Fund Five- Year Financial Forecast prior to budget adoption. The purpose of this item is to provide final updates to the proposed FY 2025-26 Operating Budget and FY 2025-26 to FY 2029-30 Five-Year Capital Improvement Plan to City Council for final adoption, in accordance with RMC Section 2.62.020.
The City of Richmond’s FY 2025-26 Budget has been developed in alignment with the City’s fiscal policies, reflecting a commitment to long-term financial sustainability and responsible stewardship of public funds. The budget adheres to the best practices outlined by the Government Finance Officers’ Association (GFOA), including principles of transparency, accountability, and structurally balanced budgeting. Additionally, it incorporates key recommendations per the State Audit. This approach ensures that the City’s financial plan supports both immediate service needs and long-term community priorities.
SUMMARY
The proposed FY 2025-26 Operating and Capital expenditure budgets total $645,448,012, of which $260,053,519 is from the General Fund and $385,394,493 is from non-General Funds.
General Fund: The proposed FY 2025-26 budget comprises revenue amounting to $308,553,519, which includes $48,500,000 in limited-term revenue. The proposed expenditures total $260,053,519, not including the $48,500,000.
Table 1 shows the change in total revenue and expenditures between May 6, 2025 and June 24, 2025.
June 24, 2025
Table 1: General Fund Budget
GENERAL FUND
FY 2024-25
REVISED
BUDGET
March 31, 2025
FY 2025-26
PROPOSED
BUDGET
May 6, 2025
FY 2025-26
PROPOSED
BUDGET
June 3, 2025
FY 2025-26
PROPOSED
BUDGET
June 17, 2025
FY 2025-26
PROPOSED
BUDGET
June 24, 2025
TOTAL REVENUES 250,327,835 306,211,175 306,211,175 308,553,519 308,553,519 TOTAL EXPENDITURES 266,672,389 257,711,175 257,711,175 260,053,519 260,053,519
GENERAL FUND NET
+SURPLUS/(-DEFICIT) (16,344,554)* 48,500,000 48,500,000 48,500,000 48,500,000 *Includes $16.3 Million One-Time Transfer Out for Several Capital Projects and Legal Costs. FY 2024-25 Revised Budget includes one-time appropriations from prior fiscal year unspent fund balance approved on October 1, 2024, and March 25, 2025
General Fund Revenue: The proposed FY 2025-26 revenue budget is $308,553,519, which is an additional $58.2 million in General Fund Revenue in comparison to the current FY 2024-25 revised General Fund Revenue. Utility Users Tax and Other Taxes are the revenue streams with the largest increases. The General Fund Revenue is summarized below and is available in Attachment 6 – General Fund Revenue and Expenditure Summary:
Property Taxes ($58.3 million)
Sales & Use Tax ($60.1 million)
Utility Users Tax ($64.9 million)
Other Taxes ($28.4 million)
Licenses Permits & Fees ($17.3 million)
Operating Transfer-In ($20.9 million)
Other Revenues ($50.2 million)
Miscellaneous Revenue ($8.4 million)
General Fund Expenditures: The proposed FY 2025-26 expenditure budget is $260,053,519. The major expenditure categories are listed below, and additional information can be found in Attachment 6 – General Fund Revenue and Expenditure Summary :
Salary/Wages and Fringe Benefits ($170.9 million)
Cost Pool ($22.7 million)
Professional and Administrative ($24.8 million)
Transfers Out ($19.0 million)
Other Operating ($9.5 million)
Utilities ($7.3 million)
Other Categories ($5.9 million)
Multi-Year Position Listing: Currently, the draft budget includes 800 Full-Time Equivalent (FTE) positions, and a 9.7 percent vacancy rate City-wide, which can be adjusted if the economy stabilizes in the coming months Position information by department can be found in Attachment 4 – Fiscal Year 2025-26 Proposed Position Listing.
Non-General Funds: The total non-General Fund budget is proposed at $385,394,492 and primarily includes funds dedicated to housing, debt service, enterprise funds, and
June 24, 2025
other City operations. The Non-General Fund by Category summary is included in Attachment 3 – Fiscal Year 2025-26 Comprehensive Budget by Fund.
On June 17, 2025, the City Council directed staff to allocate $3,000,000 for the Harbour 8 Park Expansion Project in FY 2025-26. City staff recommend reallocating funding from the three (3) community center Heating, Ventilation, and Air Conditioning (HVAC) projects’ budgets listed below in Table 2. The City is in the process of conducting a Facilities Conditions Assessment study which is anticipated to be completed by the end of 2026. Pending the study, these facilities may have other needs, such as substantial roof repair, that may need to be addressed prior to the HVAC system replacement.
Table 2: Harbour 8 Expansion Project Shortfall Funding Source
PROJECT
CURRENT
PROPOSED
BUDGET
FY 2025-26
MOVEMENT
REVISED
PROPOSED
BUDGET
FY 2025-26
REMAINING
BALANCE
NEVIN COMMUNITY CENTER HVAC 1,064,750 (1,000,000) - 64,750 RICHMOND RECREATION COMPLEX HVAC 1,114,975 (1,000,000) - 114,975 SHIELDS-REID COMMUNITY CENTER HVAC 1,027,250 (1,000,000) - 27,250 HARBOUR 8 PARK EXPANSION 403,108 3,000,000 3,403,108 -
TOTAL 3,610,083 - 3,403,108 206,975
Capital Improvement Plan (CIP): The proposed budget of $170,064,176 spreads across several funds as shown in Attachment 7 – Capital Improvement Plan FY 2025-26 to FY 2029-30. The CIP lists several projects that span over a five-year planning period, some of which are unfunded. The first year of the CIP is the proposed budget for FY 2025-26, as funded projects are budgeted on an annual basis.
GENERAL FUND
The proposed FY 2025-26 budget includes revenue totaling $308,553,519, including $48,500,000 in limited-term revenue. The proposed expenditure budget is $260,053,519, excluding the limited-term revenue of $48,500,000.
Table 3: General Fund FY 2025-26 Proposed Revenue & Expenditures GENERAL FUND FY 2025-26
PROPOSED BUDGET
TOTAL REVENUE (308,553,519)
TOTAL EXPENDITURES 260,053,519
LIMITED-TERM REVENUE 48,500,000
NET (-SURPLUS)/+DEFICIT -
June 24, 2025
Proposed Budget Adjustments
Overall, there is no net impact from proposed budget adjustments.
General Fund Proposed Revenue Adjustments
The FY 2025-26 proposed revenue budget is unchanged from the last budget presentation on June 17, 2025.
Table 4: General Fund FY 2025-26 Proposed Budget Adjustments – Revenues
GENERAL FUND
FY 2024-25
REVISED
BUDGET
FY 2025-26
PROPOSED
BUDGET
June 3, 2025
FY 2025-26
PROPOSED
BUDGET
June 17, 2025
FY 2025-26
PROPOSED
BUDGET June
24, 2025
PROPERTY TAXES 57,597,487 58,329,291 58,329,291 58,329,291 SALES & USE TAX 60,901,150 57,821,463 60,163,807 60,163,807 UTILITY USERS TAX 62,092,359 64,943,670 64,943,670 64,943,670 OTHER TAXES 23,405,397 28,399,659 28,399,659 28,399,659 LICENSES, PERMITS & FEES 16,352,770 17,274,036 17,274,036 17,274,036 FINES & FORFEITURES 176,438 200,000 200,000 200,000
INTEREST INCOME 1,796,421 3,030,545 3,030,545 3,030,545 CHARGES FOR SERVICES 3,255,703 3,724,495 3,724,495 3,724,495 OTHER REVENUE 142,830 50,167,500 50,167,500 50,167,500
RENTAL INCOME 777,478 791,157 791,157 791,157
INTERGOVERMENT STATE TAXES 125,000 150,000 150,000 150,000 STATE GRANT 130,000 180,000 180,000 180,000
OTHER GRANT 250,000 290,000 290,000 290,000
PROCEEDS FROEM SALE OF PROPERTY 15,000 15,000 15,000 15,000 LOAN/BOND PROCEEDS 40,400 40,400 40,400 40,400
OPERATING TRANSFERS IN 23,269,402 20,853,959 20,853,959 20,853,959 TOTAL REVENUES 250,327,835 306,211,175 308,553,519 308,553,519
General Fund Proposed Expenditure Adjustments
Table 5 below compares the Proposed General Fund expenditure budget from June 17, 2025, to June 24, 2025, the following budget appropriations are covered through deferring vehicle replacement by $600,000 and funding the following items. The fleet budget can be replenished later in the FY.
$100,000 – Addressing Gender-Based Violence
$500,000 – Black Resiliency Project and Fund
Other items that are included in the budget, that were absorbed by realizing budget savings through revised cost estimates for existing line items are:
$10,000 – Green and Sustainable Business Exposition (proposed new event)
$20,000 – Taste of Richmond
$7,000 – Arborist Day
Transfers out of $250,000 for Capital Improvement Lighting Project.
June 24, 2025
Table 5: General Fund FY 2025-26 Proposed Budget Adjustments – Expenditures
GENERAL FUND
FY 2024-25
REVISED
BUDGET
FY 2025-26
PROPOSED
BUDGET
June 3, 2025
FY 2025-26
PROPOSED
BUDGET
June 17, 2025
FY 2025-26
PROPOSED
BUDGET
June 24, 2025
DOLLAR
CHANGE
SALARIES AND WAGES 95,303,620 95,368,985 96,762,515 96,762,515 PAYROLL/FRINGE BENEFIT 70,548,062 73,083,339 74,157,128 74,157,128 PROFESSIONAL & ADMINISTRATIVE 23,163,189 24,428,046 24,975,481 25,354,296 378,815 OTHER OPERATING 8,623,649 9,513,865 9,539,865 9,511,051 (28,815) UTILITIES 5,626,060 7,265,830 7,265,830 7,265,830 EQUIPMENT & CONTRACT SERVICES 4,495,781 4,610,266 5,513,366 5,513,366 PROVISION FOR INSURANCE LOSS 37,042 46,500 46,500 46,500 COST POOL 24,750,598 24,297,321 22,745,184 22,145,184 (600,000) ASSET/CAPITAL OUTLAY 3,284,099 2,842,986 2,842,986 2,842,986 DEBT SERVICE EXPENDITURES 850,905 775,647 775,647 775,647 A87 COST PLAN REIMBURSEMENT (3,514,373) (3,362,171) (3,362,171) (3,362,171) GRANT EXPENDITURES 52,246 34,497 34,497 34,497 OPERATING TRANSFERS OUT 33,451,511 18,806,063 18,756,690 19,006,690 250,000 TOTAL EXPENDITURES 266,672,389 257,711,175 260,053,519 260,053,519 -
Staff Recommendation
The General Fund includes approximately $48.5 million in projected limited-term revenue that remains unappropriated in the proposed FY 2025-26 budget. City staff recommend deferring appropriation of these funds beyond the June 24, 2025, budget adoption date. City staff believe it is in the City’s best interest to postpone allocation until after the Council recess, at which point there is expected to be greater clarity regarding the economic and political landscape. This timing will also allow for a better understanding of potential funding available to the City through Federal, State, and County budgets, including grants and other programmatic sources.
NEXT STEPS
City staff recommend adopting resolutions approving (1) Fiscal Year (FY) 2025-26 Proposed Operating Budget, and (2) FY 2025-26 to FY 2029-30 Proposed Five-Year Capital Improvement Plan Budget. City staff will implement the Adopted Budget on July 1, 2025, and will bring the Quarter 1 Budget Review to the City Council in November 2025.
DOCUMENTS ATTACHED:
Attachment 1 – Resolution Adopting the Fiscal Year 2025-26 Operating Budget Attachment 2 – Resolution Approving Capital Improvement Plan for FY 2025-26 to FY 2029-30
Attachment 3 – Fiscal Year 2025-26 Comprehensive Budget by Fund Attachment 4 – Fiscal Year 2025-26 Proposed Position Listing Attachment 5 – General Fund Revenue and Expenditure Assumptions Attachment 6 – General Fund Revenue and Expenditure Summary Attachment 7 – Capital Improvement Plan FY 2025-26 to FY 2029-30 Attachment 8 – Transfer In-Out Schedule FY 2025-26
Attachment 9 – City Council Requested Items (June 17, 2025)