For City Council Meeting June 23, 2026
TO: Honorable Mayor and City Council
FROM: Tanya Williams, City Manager
AUTHOR: Scott Williams, Director of Finance
Title
Request City Council to:
1) Conduct a Public Hearing on the City’s Fiscal Year 2026-27 Proposed Annual Budget.
2) Approve and Adopt the following Resolutions:
a. Resolution No. 8531,
RHA Resolution No. 01-26,
RUA Resolution No. 26-06,
Rialto Redevelopment Successor Agency Resolution No. SA1-26,
City Fiscal Year 2026-27 CIP Budget Resolution No. 8532
for the City Fiscal Year 2026-27 Annual Budget;
b. Resolution No. 8533 Adopting the Fiscal Year 2026-27 Appropriations Limit (Gann Limit);
c. Resolution No. 8534 Adopting the Fiscal Year 2026-27 Citywide Classification and Compensation Plan.
(ACTION)
Body
RECOMMENDATION
Staff recommends that the City Council:
1) Conduct a public hearing on the City’s FY2026-27 Proposed Budget.
2) Adopt a Resolutions to approve and adopt the following:
a. Resolution, RHA Resolution, RUA Resolution and Rialto Redevelopment Successor Agency Resolution for the City’s Fiscal Year 2026-27 Annual Budget;
b. Resolution Adopting the Fiscal Year 2026-27 Appropriations Limit (Gann Limit);
c. Resolution Adopting the Fiscal Year 2026-27 Citywide Classification and Compensation Plan
BACKGROUND
In accordance with Section 2.04.140 of the Rialto Municipal Code, the City Manager must present the fiscal budget to the City Council for approval annually. Under the direction of the Finance Director, the Finance Department conducted the analysis and made the projections required to complete the budget document after receiving input from all city departments. The comprehensive process began in March and required the cooperation of staff across the entire organization. The City Manager and Director of Finance conducted budget briefings with members of the City Council to discuss the budget plan for fiscal year 2026-27, and addressed all questions related to department requests. Based on the feedback and direction received from the City Council, a proposed FY 2026-27 Budget document is presented for the City Council’s adoption.
ANALYSIS/DISCUSSION
Staff is presenting a balanced proposed FY 2026-27 budget, which includes a General Fund surplus of approximately $2.8 million, and an estimated Unrestricted General Fund balance of $75.3 million.
GENERAL FUND
The General Fund FY 2025-26 estimated year-end fund balance is projected to be $136.4 million.
Within the fund balance is the reserve for economic uncertainty, which is projected to be $36.3 million. The table above shows the overall trend of fund balance reserves, with a 5-year lookback of audited financial results. The fund balance increased for two years, with a slight projected year-over-year decrease resulting from an interfund loan payment to Rialto Utility Authority.
General Fund Revenues
The total proposed General Fund revenue for FY 2026-27 is $175,861,431, reflecting an approximate 6.5% increase over the revised FY 2025-26 budget. The City’s three primary sources of General Fund revenue are Sales Tax, Property Tax, and Utility Users Tax. Revenue estimates across all categories are based on the most recent draft audited financial results, FY 2025-26 year-end estimates, general economic conditions, as well as consumer and business activity within the City and the region. Areas with expected increases from the previous year are property tax, sales tax, revenue from other agencies, and income from the use of money and property-driven by improved investment portfolio performance due to sustained increases in short and mid-term interest rates.
Revenue by Major Category and Distribution
The table below provides FY 2026-27 budgeted estimates for all General Fund revenue, summarized by major categories, and a comparison with the current fiscal year revised budget, as well as audited results from the two prior fiscal years. The actual revenues listed below for Fiscal Year 2025-26 are as of June 10, 2026.
The same data is shown below and distributed by major category type:
Tax Revenue Appropriation Limit
The City’s Tax Revenue Appropriations from the proceeds of taxes for FY 2026-27 is $420,874,773. Proposition XIII B allows local governments to increase the appropriations limit each year based on one of two accepted growth factor methodologies. The first methodology measures the rate of inflation, and population growth percentage. The second option uses the city’s residential building growth factor. The city is using the latter of these methods, with the Appropriation Limit calculation shown below.
General Fund Expenditures
The FY 2026-27 Proposed General Fund Expenditure Budget is $173,048,480. This amount is 5.7% more than the Revised Budget for FY 2025-26.
Most department operating expenditures are expected to remain flat for the upcoming fiscal year, with some increases in contract services and facilities maintenance, reflecting the inflationary trends of the last several years. CalPERS pension costs continue to increase at a rate higher than other city expenditures, driven by market fluctuations and long-term obligations.
Total General Fund budgeted expenditures are 66% Salaries and Benefits, and 34% Maintenance and Operations, which is consistent with previous fiscal years in the City’s service delivery to the community.
In the table below, the actuals for Fiscal Year 2025-26 are posted as of June 10, 2026.
Personnel Requests
In addition to the FY 2026-27 General Fund Budget, proposed new staff positions are outlined in the tables below. These personnel changes are aimed at enhancing the level of customer service provided to the residents and businesses of Rialto. Based on recent feedback from the budget briefings, additional positions have been added to the tables below that were not included in the draft budget, specifically in engineering in the Public Works Department.
The total General Fund cost of the proposed personnel requests is approximately $1 million, which is not included in the proposed General Fund expenditures. Any personnel requests approved by the City Council will be incorporated into the final revised budget. If the Council approves all personnel requests, the FY 2025-26 General Fund budget would remain balanced, with an anticipated surplus of approximately $1.8 million-down from the currently projected surplus of $2.8 million.
In the table below, any elimination of positions are for currently vacant positions.
Fiscal Year 2026/2027: Personnel Requests, General Fund
Fiscal Year 2026/2027: Personnel Requests, Other Funds
Personnel Requests Justifications
Administration
• Eliminate
o (1) Assistant City Manager (vacant)
• Addition
o Principal Budget and Financial Analyst
The City Manager's Office proposes eliminating one Assistant City Manager position and adding one Principal Budget and Financial Analyst for the coming fiscal year. This realignment is part of a deliberate restructuring of our staffing model to better match current operational needs and organizational priorities. The existing ACM complement exceeds what is required to effectively support executive operations, and the responsibilities previously distributed among the two ACM positions can be consolidated without reducing service delivery or leadership capacity. In place of the eliminated ACM position, staff is proposing the addition of a Principal Budget and Financial Analyst to provide dedicated, high-level financial, budgetary, and analytical support directly within the City Manager's Office.
Community Development
• Eliminate
o Principal Planner (vacant)
The Principal Planner position is recommended for elimination to streamline the Planning Division’s organizational structure and remove a classification whose duties substantially overlapped with those of the Community Development Manager. Following the promotion of the former Principal Planner to Community Development Manager, the division’s current staffing structure-Planning Technician, Assistant Planner (proposed), Associate Planner, and Senior Planners-provides appropriate operational and professional planning support without the need for an additional management-level classification. Eliminating the Principal Planner position simplifies the division hierarchy while maintaining effective oversight of Planning and Business License functions under the Community Development Manager.
• Reclassification
o Administrative Analyst to Senior Administrative Analyst
The reclassification of the currently filled Administrative Analyst position is requested to align the classification with the scope, complexity, and level of responsibility of the duties currently performed. The position functions at a senior analytical level, performing complex program analysis, coordinating departmental initiatives, managing administrative and operational processes, and providing direct support to executive and management staff on policy, budgeting, and organizational matters. Reclassification to Senior Administrative Analyst will accurately reflect the advanced analytical responsibilities, independent judgment, and departmental impact associated with the position.
• Addition
o Assistant Planner
The addition of an Assistant Planner position will establish a clear progression within the Planning Division, creating a structured career ladder from Planning Technician through Community Development Manager. This classification will provide an intermediate professional planning level to support development review, planning analysis, and project coordination while building staff capacity and succession within the division. The position is proposed in conjunction with the elimination of the Principal Planner classification, resulting in overall cost savings while maintaining effective operational support for Planning activities.
o Permit Technician - Fire
The Permit Technician (Fire Prevention) position provides dedicated administrative and permitting support for Fire Prevention activities, including fire protection system permits, operational permits, and other fire-specific permitting processes. Because fire permitting requirements differ significantly from standard building permits, this position will improve efficiency, accuracy, and service delivery while supporting the Fire Plans Examiner and overall Fire Prevention operations.
o (2) Fire Inspector
The Fire Prevention Inspector position expands the Fire Prevention division’s capacity by allowing staff to conduct a broader range of inspections, including construction and operational permit inspections, beyond multi-family residential properties. The position also establishes a clear career progression within Fire Prevention, supporting employee retention and recruitment while enhancing the division’s ability to ensure compliance with fire prevention and life safety regulations.
Parks, Recreation and Community Services
• Eliminate
o (2) Pool Manager - Part Time
Eliminating two (2) part-time Pool Manager positions for one (1) full-time Pool Manager.
• Reclassification
o Administrative Analyst to Senior Administrative Analyst
The reclassification of the currently filled Administrative Analyst position is requested due to employee performing Senior Analysis work.
• Addition
o Van Driver
Addition of Van Driver for the Omni Transportation grant match.
o Pool Manager
Addition of one (1) full-time Pool Manager due to an increase in pool attendance and need to maintain pool safety.
Information Technology
• Addition
o Geographic Information System (GIS) Technician
Position will provide technical expertise in GIS technology by developing databases and creating, analyzing, and/or processing spatial and non-spatial data. Anticipated better oversight of GIS information, increased response times, in-depth project oversight, and eventually a reduction in contractual services.
Fire Department
• Reclassification
o Battalion Chief to Division Chief
• Addition
o (3) Fire Captains
o (3) Fire Engineers
o (3) Paramedics
o (3) EMT
These positions strengthen the effective response force, cuts response times, boosts unit availability, reduces unit hour utilization (UHU) and elevates training oversight-addressing one of the fire service’s highest risk management needs.
Finance
• Grade Reclassification
o Deputy Director of Finance
The current Deputy Director of Finance classification has not kept pace with the expanding scope, technical complexity, and responsibilities required to oversee the City’s financial operations.
Police Department
• Addition
o Lead Facility Maintenance Technician
The construction of the new Police Department has created the need for a dedicated Lead Facility Maintenance Technician to ensure proper upkeep and support of the facility.
o Facility Maintenance Technician
The construction of the new Police Department has created the need for a dedicated Facility Maintenance Technician to ensure proper upkeep and support of the facility.
o (2) Full-time and (1) Part-time Custodian
The construction of the new Police Department has created the need for two (2) dedicated full-time and one (1) part-time Custodians to ensure proper upkeep and support of the facility.
o Logistics Officer
The Police Department is requesting the addition of a civilian Logistics Officer position to assume responsibility for fleet management, equipment procurement, and overall logistical operations, which are currently being performed by a sworn police officer. While these duties are critical to the Department’s functionality, they do not require sworn authority and assigning them to a civilian professional represents a more efficient use of resources. Establishing this position will allow the Department to redeploy a sworn officer back into field operations or other mission-critical assignment. A dedicated civilian Logistics Officer will provide continuity, specialized focus, and improved efficiency in managing the Department’s vehicles, equipment, and facilities-related logistics, resulting in better long-term asset management and operational effectiveness.
Public Works
• Eliminate
o Director of Utilities
Utilities is moving under Public Works and Director position is no longer needed.
o Assistant to the City Manager
Utilities is moving under Public Works and position is no longer needed.
• Addition
o Project Manager
Utilities is moving under Public Works and position will replace the former Director of Utilities and oversee waste/wastewater operations.
o Administrative Analyst
Utilities is moving under Public Works. This position will provide administrative, analytical and fiscal support for water/wastewater operations.
• Grade Reclassification
o Deputy Director of Maintenance and Facilities
The current Deputy Director of Maintenance and Facilities classification has not kept pace with the expanding scope, technical complexity, and responsibilities required to oversee department operations.
Additional Impacts to General Fund Expenses
• LMD & SLD General Fund Subsidy - The Street Lighting and Landscape Maintenance Fund and the Landscape and Lighting District No. 2 Fund levy assessments to cover all expenses in the Funds.
• CalPERS employer contribution rates for its Unfunded Accrued Liability (UAL) payment will be $18.3 million. These costs are incorporated into the budget.
Special Revenue Funds
The City’s various Special Revenue Funds include grant program funds and other funds that by law are required to be segregated from other funds. The FY 2026-27 Special Revenue Fund category includes appropriations for 25 different funds with a summary of each fund provided in the attached draft budget.
Special Revenue funds account for the proceeds of specific revenue sources that are legally restricted or otherwise assigned for specific purposes and include Measure I, Gas Tax, Drainage Development, Major Capital Grants, Waste Management, and Traffic Development.
Debt Service Funds
Debt Service Funds account for the payment of principal and interest on general long-term debt of the City. Some of the funds include the Public Building Authority and Communities Facilities District Funds. The proposed appropriations for the Debt Service Funds are $306,238.
Capital Projects Funds
Capital Projects Funds are used to account for the acquisition or construction of major capital facilities. Capital project appropriations are for the life of the project.
FY 2026-27 Capital Expenditures
The City Council recently the 5-Year Capital Improvement Plan. While approved, the 5-Year CIP planning document is subject to revision as conditions and funding opportunities change. The plan represents a five-year assessment of the City’s infrastructure, facilities, and equipment needs that will be updated regularly.
Staff will evaluate proposed capital projects to determine the estimated cost, funding sources, and make recommendations from the plan. For the 2026-27 fiscal year, $8,261,143 is appropriated for capital projects. Most of the activity is carryover projects from the current fiscal year.
Enterprise Funds
Enterprise Funds account for City operations that are financed and operated in a manner similar to private business enterprises where the costs of providing goods or services to the public are financed primarily through user charges. The Enterprise Funds include the Airport Fund, Cemetery Fund, the Cemetery Endowment Fund, and the Rialto Utility Authority Funds. The proposed appropriations for all Enterprise Funds are $58,225,509.
Internal Service Funds
Internal Service Funds account for goods and services provided by one City department to other City departments or agencies. The two internal service funds are the Worker’s Compensation Fund and the General Liability Fund. The proposed appropriations for the Internal Service Funds are $16,672,660.
Agency Funds - Successor Agency
Fiduciary Funds, comprised only of Agency Funds, are used to account for assets held by the City as an agent for other governmental units, private organizations or individuals. The Successor Agency to the Redevelopment Agency Fund is included in this category. The proposed appropriations for the Successor Agency fund is $10,743,264.
ENVIRONMENTAL IMPACT
The action is exempt form California Environmental Quality Act (CEQA) pursuant to Section 15378(b)(5) of the CEQA Guidelines because of the preparation of the Audited Annual Financial Reports are governmental administrative activity that will not result in indirect physical changes in the environment.
N/A
GENERAL PLAN CONSISTENCY
General Plan Guiding Principle 3 - Rialto’s Economic Environment is Healthy and Diverse - specifically our City Government will lead by example, and will operate in an open, transparent, and responsive manner that meets the needs of the citizens is a good place to do business
LEGAL REVIEW
The City Attorney has reviewed and supports this staff report
FINANCIAL IMPACT
The FY 2026-27 citywide budget includes proposed revenues of $285,401,339 and proposed expenditures of $300,055,974. Sufficient reserves are available in specific funds to account for the excess expenditures. If projections change at any point during the fiscal year, staff will come back to the City Council with updates and recommendations to adjust accordingly. Staff will return to the City Council no later than the middle of the fiscal year with an update.