FY 2025/26 Mid-Year
Budget Update
February 25, 2026
Budget, Fiscal, and Legislative Standing Committee
FY 2025/26 Mid-Year Fiscal Summary
Revenue Reductions
• Casino Revenue: ($900,887)
• Sales Tax (Bradley Burns): ($169,841)
• Measure S: ($101,001)
Total Revenue Decrease: ($1,171,729) (–1.66%)
Expenditure Increases
• CalPERS (PERS) UAL: $496,355
• Retiree Health (OPEB): $651,904
• General Liability Insurance: $538,829
Total Expense Increase: $1,687,088 (+2.44%)
This mid-year update intends to addresses revenue and expenditure shortfalls identified in the FY 2025/26 fiscal analysis:
Net Fiscal Impact
Total Combined Impact: ($2,858,817)
FY 2025/26 Operating Budget
Revenues Expenditures Variance
FY 2025/26 Adopted $69,975,635 $68,399,722 $1,575,913
FY 2025/26 Adjusted $70,724,142 $69,148,229 $1,575,913
FY 2025/26 Projected $69,552,413 $70,835,317 ($1,282,904) Net Change ($1,171,729) $1,687,088 ($2,858,817)
Major Revenue Sources
Casino, Sales Tax, Property Tax and Utility User Tax
0.0 5.0
10.0 15.0
20.0 25.0
30.0 35.0
FY 2018-19 FY 2019-20 FY 2020-21 FY 2021-22 FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 Revenue ($ Millions)
Fiscal Year
Casino Revenue Sales Tax Property Tax Utility Users Tax Casino Revenue Actuals (FY 2023-2026**)
Payment
Schedule FY 2023 FY 2024 FY 2025 FY 2026
July –August $5,038,836 $5,002,965 $5,163,342 $5,344,164 September –October $7,396,670 $7,455,076 $7,529,478 $7,487,926 December –February $7,501,638 $7,510,831 $7,591,513 $7,591,513 March –May $7,698,296 $7,812,344 $8,087,281 $8,087,281
June $2,509,128 $2,475,756 $2,467,389 $2,467,389
Actuals: $30,144,568 $30,256,972 $30,839,005 $30,978,275 Adopted Budget $30,500,000 $31,500,000 $31,689,000 $31,879,000 Variance ($355,432) ($1,243,028) ($849,995) ($900,859)** **Projected Year-end Casino Revenue Shortfall
FY 2025/26 General Fund Shortfalls
DESCRIPTION FY 26
Budget
FY26
Projections
Expense
Shortfall
Revenue
Shortfall
Sales Tax Bradley Burns $3,064,300 $2,894,459 ($169,841) Measure S $2,200,001 $2,099,000 ($101,001)
Casino Revenue $31,879,134 $30,978,247 ($900,887)
Revenue Total: $37,143,435 $35,971,706 ($1,171,729)
CalPERS UAL $4,781,130 $5,277,485 ($496,355)
Retiree Health $0 $651,904 ($651,904)
General Liability $3,440,091 $3,978,920 ($538,829)
Expense Total: $8,221,221 $9,908,309 ($1,687,088)
Grand Total: $45,364,656 $45,880,015 ($1,687,088) ($1,171,729) Staff Recommendation #1:
Use of One-Time Operating Reserves (per FRRP)
Fund Types of Reserves FY 26
Fund Balance
02/03/2026
FY 26 Mid-Year
Budget Adjustments
03/16/2026
FY 26
Fund
Balance
03/16/2026
103 Sales Tax Revenue Sustainability Reserve $1,836,566 ($270,842) $1,565,724 104 General Liability Sustainability Reserve $918,283 ($538,829) $379,454 105 Pension (CalPERS) Liability Sustainability Reserve $918,283 ($496,355) $421,928 110 General Fund Designated Reserve $5,566,442 $5,566,442 130 Building, Facilities, & Parks Maintenance $3,383,822 $3,383,822 140 Asset and Vehicle Replacement Reserve $1,932,127 $1,932,127 150 Catastrophic Reserve $28,160,289 $28,160,289
170 Budget Stabilization Reserve $2,816,029 $2,816,029
180 Casino Revenue Sustainability Reserve $12,855,957 ($900,887) $11,955,070 190 City Manager's Contingency Reserve $182,385 $182,385 Total: $58,570,183 ($2,206,913) $56,363,270
Staff Recommendation #2:
Use of OPEB Trust Funds (Special Revenue Funds)
Description Balance
02/25/2026
Reduction
03/16/2026
Balance
03/16/2026
OPEB Trust Fund 610: Retiree Health $18,965,539 ($651,904) $18,313,635 Total: $18,965,539 ($651,904) $18,313,635
Summary of All Operating Reserves & Special
Revenue Funds for Mid-Year Budget Adjustment
Fund Types of Reserves
FY 26
Fund
Balance
02/03/2026
FY 26 Mid-Year
Budget
Adjustments
03/16/2026
FY 26
Fund
Balance
03/16/2026
103 Sales Tax Revenue Sustainability Reserve $1,836,566 ($270,842) $1,565,724 104 General Liability Sustainability Reserve $918,283 ($538,829) $379,454 105 Pension (CalPERS) Liability Sustainability
Reserve $918,283 ($496,355) $421,928
180 Casino Revenue Sustainability Reserve $12,855,957 ($900,887) $11,955,070 610 OPEB Trust Fund: Retiree Health $18,965,539 ($651,904) $18,313,635 Total: $35,494,628 ($2,858,817) $32,635,811
1. Receive Presentation; and
2. Direct City Manager to monitor closely all revised GF expenses during FY 2025-26, and explore all fiscal measures to ensure that adopted revenues align with revised budgeted expenditures for fiscal year ending June 30, 2026; and
3. Proceed with a BFLSC recommendation to the City Council on approval of FY 2025/26 General Fund and Special Revenue Fund Mid-Year Budget Adjustments, effective March 2, 2026.
4. Authorize the City Manager to prepare a year-end budget reconciliation adjustment for FY 2025-26, if fiscally necessary to address any unforeseen contingencies.
Staff Recommendation to BFLSC
CONCLUSION
QUESTIONS OR COMMENTS?
Overview
• The FY 2025/26 Mid-Year Fiscal Analysis identifies
projected adjustments of:
• Decrease in Revenues ($1,171,729) (–1.66%)
• Increase in Expenses $1,687,088 (+2.44%)