For City Council Meeting December 9, 2025
TO: Honorable Mayor and City Council
APPROVAL: Tanya Williams, City Manager
FROM: Scott Williams, Director of Finance
Title
Request City Council to: (1) Receive a Mid-Year Budget Presentation for Fiscal Year 2025-2026 and (2) Adopt Resolution No. 8440 Amending the Fiscal Year 2025-2026 Fiscal Budget.
(ACTION)
Body
RECOMMENDATION
Staff recommends the City Council:
1) Receive a presentation on General Fund Revenue and Expenditures for Mid-Year of Fiscal Year 2025-26; and
2) Adopt a Resolution approving the Mid-Year Budget Adjustments and amending the Fiscal Year 2025-2026 Fiscal Budget.
BACKGROUND
On June 24, 2025, the City Council adopted the Fiscal Year 2025-2026 (FY25-26) Annual Budget, which included reasonable estimates of revenues, expenses, transfers, and ending reserves.
The Mid-Year Budget Report summarizes the overall financial performance of the City for the period of July 1, 2025, through December 31, 2025. The report was developed and to offer the most up-to-date information and estimates on the City’s financial health, enabling accurate and well-informed decision-making. Additionally, these reports assist City departments in communicating their financial operations throughout the fiscal year, including any program changes and significant impacts on their annual budgets, as well as gauging the City’s budget plan against actual revenue and expenditures.
The financial information included in this report is preliminary, unaudited, and subject to revision upon completion of the City's audit. However, preliminary financial results are complete, and no material changes are expected for the final financial results.
ANALYSIS/DISCUSSION
The City’s Finance department has substantially completed the audit for the previous Fiscal Year 2024-2025.The full financial audit report and results will come to City Council in January 2026, however the preliminary results demonstrate that the City continues to be in sound financial health. The City completed the year with $174.3 million in revenue and $138.8 million in expenditures. The table below outlines the summary of these, including that the general fund has just over $70.3 million in unassigned fund balance.
General Fund Review for Fiscal Year 2026:
The City’s FY25-26 General Fund adopted budget includes total revenues of $164.9 million and expenditure appropriation of $161.8 million.
Revenue:
The City’s revenue is comprised of numerous streams of taxes, fees and other revenues from other agencies or other sources. Property tax continues to steadily grow as the City continues to develop. The Utility User’s Tax comprises approximately 12% of the city’s general fund revenue and has increased over the years as utility rates have increased. The largest source of revenue for the City is sales tax, comprising just over 45% of the general fund revenue.
For this financial period, the City remains on track to meet the budgeted amounts in general fund revenue. For those revenue line items that are not at 50% already for the year, the cause is primarily due to timing where the city receives the bulk of the revenue after December. For example, property taxes are primarily received by the city in the second half of the fiscal year.
Expenditures:
Department budgets are continuously monitored and tracked. The following requests have come forward to be incorporated into this year’s budget to account for an increased need in the departments.
There are proposed adjustments to the General Fund FY26 budget, along with three personnel requests:
Proposed Adjustments to the General Fund
Community Development
The Department is requesting an additional appropriation due to increased costs associated with upgrades to the City’s booth at ICSC.
Police Department
The Department is requesting an additional appropriation for the firearm project-replacing outdated equipment and ammunition-that was not completed in the prior fiscal year, along with the purchase of SWAT equipment that was not received prior to the close of FY24-25.
Proposed Adjustments to Non-General Fund Accounts
Community Development
The Department is requesting an adjustment to the CDBG funding to account for the reprogramming of funds.
Fire Department
The department is requesting two adjustments to establish budget for a City match required by the Emergency Operations Center (EOC) grant awarded to the City.
Police Department
The Department is requesting an adjustment to establish budget for interest earned in the prior year.
Personnel Requests
Customer service is the bridge between the City and the public, which plays a crucial role in building and maintaining trust. In order to strengthen, streamline, and create more effective customer service, personnel requests were made by the following departments. Should the City Council approve these positions through this Mid-Year process, staff will return to Council in January with all required documentation to formally add the approved employee classifications to the City’s salary schedule.
• Police Department - Add (2) Crime Analyst Assistant
• Fire Department- Add (1) Emergency Manager
• Personnel requests total to an approximation of $430,966.
Police Department
The construction of the new state-of-the-art Police Department has created the need for additional personnel to enhance operations and better serve the community.
Crime Analyst Assistant
The Police Department is requesting two (2) Crime Analyst Assistants to support the development and implementation of the Real Time Crime Center (RTCC). These positions will represent the fifth and sixth of the eight total roles required to fully staff the bureau.
Fire Department
The Fire Department is requesting additional personnel to better meet community needs by improving Departmental efficiency, enhancing customer service, and reducing response times to emergency calls.
Emergency Manager
The Emergency Manager will enhance Citywide preparedness and emergency response coordination by securing grants and leading interdepartmental resilience planning efforts. The reallocation of the EMS Coordinator results in minimal budgetary impact.
ENVIRONMENTAL IMPACT
The request is not a Project as defined by Section 15378 of the California Environmental Quality Act (CEQA). Pursuant to Section 15378(a), a “Project” means the whole of an action, which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. According to Section 15378(b), a Project does not include: (5) Organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment.
GENERAL PLAN CONSISTENCY
Complies with the following Rialto General Plan Guiding Principle:
Our government will lead by example, and will operate in an open, transparent, and responsive manner that meets the needs of the citizens and is a good place to do business.
LEGAL REVIEW
The City Attorney has reviewed the Resolution and approved it as to form.
FINANCIAL IMPACT
Operating Budget Impact
Approval of this item will authorize additional appropriation of $267,925 to the General Fund, along with an increase of $1,062,724 to Special Revenue Fund accounts.
Capital Improvement Budget Impact
Approval of this item will authorize additional appropriation of $287,500 to the Capital Improvement Budget.
Licensing
A Business License is not required as part of this action.