HomeMy WebLinkAboutItem 6a. Adoption of the FY 2026-27 Budget Supplement Item 6a
Department: Finance
Cost Center: 2002
For Agenda of: 6/2/2026
Placement: Business
Estimated Time: 120 minutes
FROM: Whitney McDonald, City Manager
Prepared By: Emily Jackson, Finance Director and Riley Kuhn, Principal Budget Analyst
SUBJECT: ADOPTION OF THE FY 2026-27 BUDGET SUPPLEMENT
RECOMMENDATION
1. Adopt a Draft Resolution entitled, “A Resolution of the City Council of the City of San
Luis Obispo, California, approving the Fiscal Year 2026 -27 Budget” (Attachment A)
and approve the allocations as stated in the Budget Supplement document
(Attachment B); and
2. Confirm or modify cost recovery goals (Attachment C) to be used in the FY 2026-27
user fee study; and
3. Receive a status update on the San Luis Obispo Museum of Art’s (SLOMA) progress
related to the City’s Phase 1 grant.
POLICY CONTEXT
Pursuant to Sections 802 and 804 of the City Charter, the City Council must adopt the FY
2026-27 budget by June 30, 2026, in order for the appropriations to be in place when the
next fiscal year begins. This action is accomplished by resolution, which is provided as
Attachment A to this report.
Pursuant to Section 2 – User Fee Cost Recovery Goals – within the City’s Budget Policies
(Attachment C), fees are reviewed and updated on an ongoing basis to ensure that they
keep pace with changes in the cost-of-living as well as changes in methods or levels of
service delivery.
The SLOMA Downtown expansion project has significant alignment with numerous City
of San Luis Obispo plans and policies. These include the City’s existing Major City Goals,
Economic Development Strategic Plan, Downtown Concept Plan, and General Plan Land
Use Element.
DISCUSSION
Background
The City utilizes a two year Financial Plan and is currently under the 2025 -27 Financial
Plan. The Financial Plan includes one year of adopted budget and a forecast of the
Page 259 of 454
Item 6a
second year which must be formally adopted as the budget supplement. This report
provides an outline of the contents of the FY 2026-27 Budget Supplement, which is
included as Attachment B.
Overview
The FY 2026-27 Budget Supplement includes balanced budgets for the General Fund,
the four Enterprise Funds, the Special Revenue Funds, and all other budgeted funds. It
also includes information on departmental performance measures, Major City Goals, and
the Capital Improvement Plan. The budget document, included as Attachment B, includes
the following sections:
City Manager Message: In this section, the City Manager provides a high level
overview of the City’s accomplishments in the current year and a look forward at
the next fiscal year.
Changes Since Financial Plan: This section includes the recommended budget
reductions presented to the City Council in the March 3rd Supplemental Budget
Preview, as well as a number of recommended additions to the budget, also
referred to as Significant Operating Budget Changes.
Consolidated Financials: This section provides a high level overview of Citywide
revenue and spending.
General Fund Overview: The General Fund is funded primarily by taxpayers and
provides services and infrastructure for broad public benefit. This section provides
a detailed analysis of the Fund’s budget, including a long-term forecast.
Special Revenue and Other Funds: Community Facilities Districts, Business
Improvement Districts, Internal Service Funds, and other funds are included in this
section.
Local Revenue Measure: This section provides information on how funds
generated by the Local Revenue Measure are used to fund critical City projects
and operations.
Debt Service: Information on all of the City’s outstanding borrowings is included
here.
Capital Improvement Plan: The capital projects being funded in the next fiscal
year are included here, as is a discussion of major ongoing projects and
recommended changes to the Capital Improvement Plan compared to the Plan
presented in the 2025-27 Financial Plan.
Major City Goals: Staff provide an update on Major City Goal tasks, including
recommended modifications to tasks and timelines.
Page 260 of 454
Item 6a
Department Summaries: Each department shares an update on its programs,
provides updated performance measures to quantify departmental operations, and
describes changes to departmental budgets.
Appropriation Limit: The City’s appropriation limit is based on the Gann
Spending Limit Initiative, a State constitutional amendment. This section includes
a calculation to validate that the budget is within constitutional limits.
Other Items:
In addition to consideration and adoption of the FY 2026-27 Budget, staff is
recommending consideration of two policy or grant-related items that implicate City
resources. Specifically, staff requests (1) review and confirmation of the current cost
recovery goals that are incorporated into the 2025-27 Financial Plan and will guide
development of a future user fee study in Fiscal Year 2026 -27, and (2) receipt of a brief
status report on the SLOMA Phase 1 Grant agreement.
User Fee Cost Recovery Goals: The City’s fiscal policies are presented to the City
Council for review with each Financial Plan to determine whether updates are needed.
Revisions typically aim to ensure consistency across policies, reflect current practices,
and maintain an efficient and effective administrative system. The Fiscal Policies were
last reviewed and approved on June 17, 2025, with adoption of the 2025 -27 Financial
Plan, which included substantive updates to Fiscal Policy 2 – User Fee Cost Recovery
Goals. These changes aligned the policy with the FY 2024 -25 User Fee Schedule
adopted on July 2, 2024, including updating the frequency of user fee studies from every
five years to every three years, allowing market rate analysis for certain fees, and revising
cost recovery levels (see July 2, 2024 City Council meeting minutes).
Consistent with the updated policy, staff will conduct the next user fee study in FY 2026 -27
and present recommended fee changes to the City Council in Spring 2027, with new fees
effective July 1, 2027. Before beginning this study, staff is requesting the City Council’s
review of the cost recovery policy as part of the FY 2026-27 Budget Supplement. This will
allow Council to give direction on any desired changes to cost recovery levels, which can
then be incorporated into the study. The current policy, adopted with the 2025 -27
Financial Plan, is included as Attachment C.
SLOMA Grant Update
SLOMA is continuing progress on their Downtown expansion project. Staff have also
been continuing to meet with SLOMA to evaluate progress related to the City’s Phase 1
grant. Based on the updates provided, SLOMA will soon complete the requirements of
this grant, which include securing all funds for Phase 1 of the project, receiving all
necessary project entitlements, completing a fundraising plan for the full project,
completing a 3-year budget forecast and identification of additional public benefits. Staff
expect to receive a report formally documenting this progress shortly. As stated in the
February 17th 2026, Council Agenda Report for the Phase 1 grant, upon completion of
these requirements, staff would return to Council at the next regularly scheduled budget
Page 261 of 454
Item 6a
update to consider options and recommendations for additional funding for Phase 2 (to
support purchase of the expansion property). Staff have not included recommended
Phase 2 funding as part of the FY 2026-27 Budget Supplement due to the timing of
completion of the Phase 1 grant requirements and a lack of available funding. Staff
anticipate reviewing availability of funds for Phase 2 with the Year End Budget Review
for FY 2025-26. Consideration of funding would be subject to the actual availability of
funds at that time, which could preliminarily include additional FEMA reimbursements or
other over-realized revenue.
Previous Council or Advisory Body Action
Council heard a preview of the Supplemental Budget on March 3, 2026.
Public Engagement
Public comment on this item can be provided to the City Council through written
correspondence prior to the meeting and through public testimony at the meeting. This
report and attachments were published May 20, 2026, approximately two weeks prior to
the hearing, to provide additional time for public review.
CONCURRENCE
All departments participated in development of the budget and concur with the
recommendations. The Revenue Enhancement Oversight Commission concurs with the
recommended use of Local Revenue Measure funds.
ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) does not apply to the recommended
actions in this report because the actions do not constitute a “Project” under CEQA
Guidelines Sec. 15378
FISCAL IMPACT
Budgeted: Yes Budget Year: 2026-27
Funding Identified: Yes
Fiscal Analysis:
As outlined in the budget document, the recommendation is to appropriate a budget of
$224,742,744 across all funds. All fund budgets are balanced and maintain adequate
reserves as called for by policy, except as noted in the report.
The recommendation to confirm or modify the cost recovery goals included in Attachment
C has implications for the long-term outlook for the City. The current long-term forecasts
assume no change to cost recovery; increasing or decreasing recovery targets will
inrease or decrease revenue.
The recommendation to receive a status update on the SLOMA grant has no fiscal impact.
Page 262 of 454
Item 6a
AL TERNATIVES
Council could direct staff to make specific modifications to the proposed budget.
Should Council pursue this option, the Council would need to provide specific direction to
staff to incorporate changes into the adopted budget document.
Council could continue the budget hearing for further discussion. Should Council
pursue this option, staff will return to Council on June 16th for a continued hearing on the
budget.
Council could direct staff to make modifications to Major City Goal work programs.
Should Council pursue this option, discussion could be continued to June 16th, to a
different future meeting, or to the FY 2025-26 Year End Budget Report.
Council could direct staff to make modifications to the User Fee Cost Recovery
Goals. Should Council pursue this option, changes will be incorporated into the cost
recovery goals and be applied to the development of the user fee study that will
commence in Fiscal Year 2026-27, with a goal of adoption of revised user fees prior to
July 1, 2027.
ATTACHMENTS
A - Draft Resolution Approving the FY 2026-27 Budget
B - FY 2026-27 Budget Supplement
C - Fiscal Policy- User Fee Cost Recovery Goals
Page 263 of 454
Page 264 of 454
R _____
RESOLUTION NO. ______ (2026 SERIES)
A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS
OBISPO, CALIFORNIA, ADOPTING THE FISCAL YEAR 2026-27
BUDGET
WHEREAS, pursuant to Section 804 of the City Charter, the City Council must
adopt the FY 2026-27 Budget by June 30, 2026 for the appropriations to be in place when
the next fiscal year begins on July 1, 2026; and
WHEREAS, pursuant to Section 803 of the City Charter, the City Council shall hold
a public hearing on the proposed budget and this hearing was held during the June 2,
2026 City Council meeting; and
WHEREAS, California voters approved the Gann Spending-Limitation Initiative on
November 6, 1979 and Proposition 111 on June 5, 1990, which establish and define
annual appropriation limits on state and local government agencies; and
WHEREAS, the California Government Code requires that the governing body of
each local agency establish its appropriations limit and annual factors by resolution; and
NOW, THEREFORE, BE IT RESOLVED, by the Council of the City of San Luis
Obispo as follows:
SECTION 1. The Fiscal Year 2026-27 budget is hereby approved and that the
budget for the fiscal year beginning July 1, 2026 and ending June 30, 2027 is hereby
appropriated as presented in the FY 2026-27 Supplemental Budget.
SECTION 2. The City Manager is hereby delegated authority to approve budget
adjustments, including non-substantive format and typographical changes found within
the FY 2026-27 Budget, consistent with the adopted budget policies to maintain
budgetary flexibility and balances for the organization .
SECTION 3. The City’s appropriation limit and annual adjustment factors for Fiscal
Year 2026-27 are adopted as follows:
Upon motion of _________, seconded by ________, and on the following roll call
vote:
AYES:
Appropriations Limit 2025-26 $102,632,964
Cost of Living Increase 1.05%
Population Factor: City Population Growth 1.01%
Compounded Percentage Factor (multiplicative not additive) 1.06%
Appropriations Limit 2026-27 $108,396,106
Page 265 of 454
Resolution No. ____ (2026 Series) Page 2
R ____
NOES:
ABSENT:
The foregoing resolution was adopted this ___ day of June 2026.
______________________________
Mayor Erica A. Stewart
ATTEST:
Teresa Purrington,
City Clerk
APPROVED:
J. Christine Dietrick,
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the
City of San Luis Obispo, California, on ______________________.
________________________________
Teresa Purrington,
City Clerk
Page 266 of 454
FY 2026-27 Recommended Budget Page 267 of 454
202 -2 Financial Plan
BUDGET SUPPLEMENT
ERICAA. STEWART, MAYOR
,VICE MAYOR
JAN MARX, COUNCILMEMBER
, COUNCILMEMBER
, CITY MANAGER
2 Page 268 of 454
Table of Contents
4
18
Section 1: Introduction
City Manager Message
Section 2: Changes from Financial Plan Adoption
Section 3: Consolidated Financials
Section 4: General Fund Overview
Section 5: Special Revenue and Other Funds 32
Section 6: Local Revenue Measure
45Section 7: Debt Service
48Section 8: Capital Improvement Plan
75Section 9: Major City Goals
Section 10: Department Updates
Admin/IT
City Attorney
Community Development
Finance
Fire
Human Resources
Parks & Recreation
Police
Public Works & Utilities
105
Section 11: Appropriation Limit
22
39
86
90
93
96
99
102
139
110
112
10
3 Page 269 of 454
Honorable Mayor, Members of the City Council, and Residents of San Luis Obispo:
I am pleased to present the FY 2026-27 Budget Supplement. This budget reflects our organization’s
long-standing commitment to fiscal responsibility, strategic investment, and high-quality public service. It
also incorporates the realities identified in the comprehensive budget update delivered to the City Council
on March 3, 2026, including evolving economic conditions, federal policy uncertainty, and a slowing pace
of revenue growth. This budget recommends expenditure reductions which were carefully evaluated to
minimize community impacts. Despite fiscal constraints, we expect to be able to maintain our long-term
focus on initiatives that align with City Council’s Major City Goals and improve the quality of life in our
community.
Fiscal Year 2025-26 In Review
Development of the 2025-27 Financial Plan and FY 2025-26 Budget represented a shift from prior years
where the City experienced significant economic and revenue growth in the wake of Local Revenue
Measure (LRM) passage in November 2020 and recovery from COVID-19. When building the budget last
year, the long-term forecast projected a General Fund deficit of $2.5 million in FY 2025-26 due to a cooling
economy, slowed revenue growth and increasing costs. With that dampening forecast looming, the City
Council approved a number of recommended actions to bring the budget into balance for FY 2025-26.
These included constraining non-staffing budget growth to FY 2024-25 levels, reallocating $1M of LRM
dollars from the Capital Improvement Plan to support the operating budget, increasing the staffing savings
assumption in the General fund from 3% to 4%, and significantly decreasing recommended Significant
Operating Budget Changes (SOBCs) compared to prior years. In total, these actions balanced the budget
for FY 2025-26. While these steps have tightened the operating budget, we are encouraged by FY 2025-
26 results through the third quarter, which are generally positive. That being said, we do expect that the
amount of unassigned fund balance experienced at the end of the year will be lower than it has historically
been. In the recent past, the City has seen large, unassigned fund balances, which have been used to
increase payments to CalPERS and make strategic long-term investments in the community. Smaller
balances will limit our investment opportunities.
While the adopted 2025-27 Financial Plan presents a balanced budget for these two fiscal years after
implementing the budget balancing strategies describe above, the five-year financial forecast indicated a
projected deficit beginning in the next financial plan, largely due to the need to open an additional fire
station combined with slower economic growth projections. With this forecast in mind, the Fiscal Health
Contingency Plan was activated in April 2025, establishing hiring and travel chills to ensure careful and
controlled spending while departments undertook a close review of their budgets with the goal of
recommending expenditure reductions in March 2026. Employing these short-term strategies right-sized
the immediate budget pressures and also provided sufficient breathing room to allow the City to develop
thoughtful long-term solutions that restore structural balance, while still preserving our ability to make
progress on the Council’s adopted Major City Goals and maintain the essential services residents rely on
every day.
4 Page 270 of 454
Despite budgetary constraints, we have maintained our commitment to deliver high-quality services to
the community and make progress on a number of important initiatives and projects in the current year.
Highlights are included below:
Capital Projects & Infrastructure
• Completed the Water Resource Recovery Facility (WRRF) upgrade, the City’s largest capital
improvement project to date, upgrading water treatment processes to modern standards and
improving water quality released into San Luis Obispo Creek.
• Completed construction of the Cultural Arts District Parking Structure, providing additional
parking for downtown employees and visitors while supporting the City’s growing Cultural Arts
District.
• Initiated the Righetti Community Park project, which will add nearly 11.25 acres of new park
amenities including pickleball courts, bike facilities, walking paths, event space, playgrounds, and
recreational areas.
• Completed paving and multimodal improvements on the eastern portion of Tank Farm Road, while
advancing several alternative transportation projects including the upcoming Higuera Complete
Streets Project.
• Advanced design on the Prado Bridge Widening and Prado Road/Highway 101 interchange
projects.
• Completed the Mid-Higuera Bypass project in partnership with San Luis Obispo County and the
California Department of Water Resources, increasing flood capacity, reducing flood risk, replacing
the Bianchi Lane bridge, and improving creek habitat.
• Made substantial progress on the Mission Plaza Enhancements Project, including opening new
public restrooms and development of a kiosk café operated by a local business.
• Restored all fixed-route transit services to pre-pandemic levels while advancing toward zero-
emission operations through deployment of electric buses, charging infrastructure, and new rider
technologies.
• Completed the Laguna Lake Bike Park through a unique partnership between Parks & Recreation
staff and community volunteers, providing amenities for riders of all skill levels.
• Completed multiple public art projects, including updated utility box installations, the Newport
Community Mural, and new sculpture installations in partnership with SLOMA.
• Continued work to secure FEMA and CalOES reimbursement for 2023 Winter Storm response
costs, with $1.9 million received and an additional $6.71 million pending Congressional review.
5 Page 271 of 454
Programs, Operations & Community Initiatives
• Developed and delivered a public information campaign to educate voters on the City’s new
Citywide Single Vote election system ahead of the November 2026 election.
• Launched the “SLO Grown Business Support” program, a free service helping businesses navigate
City processes and access resources.
• Hosted three Belonging Project events to foster inclusion, broaden understanding, and strengthen
community connection.
• Completed the biennial Community Academy program, with more than 30 residents graduating
after learning about City operations, services, and decision-making.
• Adopted the new State Fire Hazard Severity Zone maps and developed educational materials to
assist residents with home hardening and fire safety standards.
• Obtained recognition by the State of California as a “Clean California Community” for efforts to
reduce litter, improve public spaces, and foster community pride.
• Engaged in state legislative advocacy, submitting more than 35 letters on bills impacting City
operations, seeing some smaller but meaningful wins such as the muralist licensing exemption (SB
456).
• Began preparing implementation of major new state mandates, including updated public meeting
requirements under SB 707 and new labor related contracting notice rules under AB 339.
• Ensured significant reductions in illegal neighborhood parties during St. Patrick’s Day weekend,
including complete elimination of illegal street parties, in partnership with Cal Poly.
• Reconfigured the Oracle Enterprise Resource Planning (ERP) system to improve organizational
efficiency and accuracy.
• Reorganized the Public Works and Utilities departments to improve customer service, operational
efficiency, and internal coordination.
Housing & Homelessness
• Continued significant progress toward achieving State Regional Housing Needs Allocation (RHNA)
goals, with housing projects advancing at all income levels and 3,190 housing units permitted since
2019.
• Supported the development of the County’s Welcome Home Village, which will provide 14 interim
supportive housing units beginning this summer and 40 permanent supportive housing units
beginning this fall within city limits.
• Helped deliver and open the Maxine Lewis Grove Apartments at 732 Orcutt Street, providing 39
permanent supportive housing units.
6 Page 272 of 454
• The City and its partners are advancing an additional 357 affordable housing units over the next
five years, including 75 permanent supportive housing units.
• Proactively worked with internal teams and community partners to close and remediate 258
encampments over the past calendar year, removing more than 44 tons of trash and debris.
• The Community Action Team (CAT) and Mobile Crisis Unit (MCU) made 740 unique contacts with
individuals experiencing homelessness, including 162 mental health and substance abuse
referrals, 111 housing referrals, 49 transports to services, and reunification of 26 individuals with
family or support agencies. Through a partnership with the County Behavioral Health Department,
Licensed Psychiatric Technicians embedded within CAT and MCU now provide crisis intervention,
outreach, engagement, and connections to treatment and support services.
These accomplishments reflect our commitment to achieve the Council’s Major City Goals and complete
other important initiatives.
Development of the FY 2026-27 Budget
Development of the FY 2026-27 budget reflected a continuation of the approach used to develop the
2025-27 Financial Plan. Despite better-than-expected revenue performance through the first half of FY
2025-26, staff is closely tracking changes in federal policy and ongoing geopolitical tensions which could
impact consumer spending. The long-term forecast for the General Fund has been updated and key
assumptions are noted in Section 4 (General Fund Summary) of this document.
Due to the forecasted structural deficit beginning in Fiscal Year 2027-28, in the Fall of 2025, all
departments participated in a budget balancing exercise and identified lists of reduction options
equivalent to 5% and 8% of their operating budgets. These targets were higher than what was expected
to be necessary to address the structural deficit in order to ensure that a sufficient range of options would
be developed at one time, minimizing disruption and anxiety for the organization. As result of the budget
balancing exercise, staff is recommending $1,663,973 in ongoing expenditure reductions. Of that amount,
$576,379 is recommended to be reallocated to public safety overtime, which has been historically
underfunded, for a net reduction to the General Fund of $1,087,594. The recommended expenditure
reductions represent significant effort by staff and deliberation by the Leadership Team to identify a
means for reducing expenditures while minimizing impacts to the community and to staff. Consistent with
Council’s adopted Budget Balancing Strategies, recommendations do not reflect across the board
reductions. While all departments participated in the exercise and reductions are recommended in each
department, there is variability in the amounts and types of reductions between departments based on
the anticipated service level impacts, ability to address critical items including core services and Major
City Goal work programs, and consideration of the existing constraints within departmental budgets.
In addition to the expenditure reductions previewed on March 3, 2026, all departments were asked to
craft FY 2026-27 budgets that kept non-staffing expenditures flat with the current year. The impacts of
not adjusting base budgets were untenable in some instances due to cost increases experienced for
services that are outside of the City’s control. As a result, staff adjusted recommended expenditure
7 Page 273 of 454
appropriations to account for specific increases. This exercise constrained non-staffing expenditure
growth far more in comparison to the past approach of making inflationary adjustments to most
expenditures.
The actions taken to reduce expenditures and constrain expenditure growth generated sufficient savings
to enable investment towards key initiatives planned for FY 2026-27. For the General Fund,
recommended Significant Operating Budget Changes (SOBCs) include piloting a statistically valid
community survey, completing a comprehensive user fee study, reclassifying a position in the Fire
Department to better support fire vehicle maintenance needs, increasing costs to support various Police
system and software needs, mediation services, vehicle telematics and electrical panel inspections. Each
of these investments, including additional investments in the City’s Enterprise Funds to deliver key water
and wastewater capital projects are discussed in more detail in this document. The total amount
recommended for General Fund SOBCs in FY 2026-27 is $297,323- a notable decrease from prior years
(ranging from $485,057 in FY 2024-25 to $1,233,124 in FY 2023-24).
Opportunities and Cautious Outlook
San Luis Obispo continues to benefit from a strong local economy, and a disciplined financial framework
that prioritizes long-term stability. The City’s early actions over the last two years of cost-containment
measures, targeted service realignments, and ongoing revenue monitoring, have positioned us to
navigate the economic shifts that may be coming.
Core revenues remain generally stable. Property tax continues to show resilience even as the real estate
market moderates, and transient occupancy tax continues to outperform budget. While sales tax growth
has slowed compared to the first few years following the passage of the Local Revenue Measure and
post-pandemic surges, it remains positive overall, supported by the community’s diverse economic base
and steady tourism activity. These trends support our ability to maintain existing services, advance City
Council priorities, and invest in infrastructure that residents rely on every day.
Despite these strengths, the March 2026 budget update underscored several important risks. Federal
policy changes under consideration, particularly those affecting interest rates, and infrastructure funding,
could affect local economic performance and the City’s budget over the coming years. Further global
tensions and conflicts in the middle east and elsewhere are increasing economic pressures here at home.
Taken together, their potential impacts warrant caution.
We are also mindful that the growth of our community will necessitate further investment in core
programs to ensure that our service levels are not compromised. As noted in the 2025-27 Financial Plan,
our obligation to bring a fifth fire station online in the next financial plan period will require an investment
of approximately $2 million on an annual basis. In addition to community growth, we need to carefully
monitor cost escalation in employee wages and benefits, construction materials, and energy-- areas
where inflation has moderated but not fully stabilized. It is also worth noting that our operating reserve
is currently below Council-adopted policy levels. As a result, we will need to balance future investment in
services or facilities with the need to bring the reserve to policy levels to mitigate against economic risk.
8 Page 274 of 454
These pressures, combined with slowing revenue growth, mean we must remain disciplined in managing
spending while prioritizing investments that have long-term community benefit.
I am grateful to the City Council for its leadership and for the thoughtful consideration of staff’s
recommendations. In addition, I want to recognize the dedication of our employees who have continued
to deliver the City’s services despite the economic uncertainty and ongoing efforts to work towards
structural budget balance. I am heartened by our organization’s commitment to delivering high quality
services and the engagement of our community as we work to shape a sustainable future for San Luis
Obispo.
With gratitude,
Whitney McDonald
City Manager
9 Page 275 of 454
Changes from Financial Plan
2. Changes from Financial Plan
Budget Balancing Exercise
Following adoption of the 2025-2027 Financial Plan in June 2025, staff began a budget balancing exercise
to develop a plan to address the identified budget deficit. A key part of that plan was operating expenditure
reductions. Consistent with the City Council adopted Budget Balancing Strategies, all departments
participated in the reduction exercise. Departments were asked to prepare two sets of departmental
budget reduction options, equal to 5% and 8% of their respective ongoing operating budget. These targets
were higher than what was expected to be necessary to address the structural deficit. This provided staff
with flexibility to respond to changes in economic circumstances and to ensure that a sufficient range of
options would be developed at one time, to minimize disruption and anxiety for the organization. The
Leadership Team carefully reviewed proposed reductions over several days to ensure that the final
recommendations would generate sufficient savings while minimizing impacts to the community and the
organization.
As a result of the budget balancing exercise, staff is recommending $1,663,973 in ongoing expenditure
reductions beginning in FY 2026-27. Of that amount, $576,379 is recommended to be re-allocated to
public safety overtime, for a net reduction in spending of $1,087,594. Consistent with Council’s adopted
Budget Balancing Strategies, recommendations do not reflect across the board reductions. While all
departments participated in the exercise and reductions are recommended in each department, there is
variability in the amounts and types of reductions between departments based on the anticipated service
level impacts, ability to address critical items including core services and Major City Goal work programs,
and consideration of the existing constraints within departmental budgets.
The recommended reductions by department, including the relative size of the reduction as a percentage
of current year budgets, and the proposed Full Time Equivalent (FTE) personnel reductions are detailed
below. No layoffs are recommended as all reduced positions are vacant.
2.1 Budget Balancing Summary
Department FY 2025-26
Adopted Budget Reductions % of Budget FTE Reduction
Administration/IT 10,983,688$ 175,700$ 1.60%0.50
City Attorney 1,657,575 60,853 3.67%(0.15)
Community Development 7,973,537 170,125 2.13%-
Finance 2,770,356 29,935 1.08%-
Fire 18,214,320 453,246 2.49%3.00
Human Resources 2,037,833 48,200 2.37%-
Police 25,564,923 123,133 0.48%1.00
Parks & Recreation 6,141,965 90,042 1.47%-
Public Works 17,428,593 506,240 2.90%-
Utilities 1,381,664 6,500 0.47%-
Total 1,663,973$ 4.35
10 Page 276 of 454
Changes from Financial Plan
The recommended expenditure reductions were previewed with the City Council on March 3, 2026, and
remain unchanged. Additional detail on the budget reductions, can be found in the tables below:
2.2 Department Detail
Administration & IT
Category Net Reduction Description
Staffing 40,697$
Eliminate one 0.50 Regular Half-Time FTE Administrative Assistant position in the
City Clerk's office. This position, approved by Council during FY 2021-22 to support
hybrid public meetings, has remained vacant since its approval and the transition to
hybrid meetings in July 2026 will be managed with existing resources.
Contract Services 46,760
Includes reductions to contract grant writing support that has historically not been
fully utilized due to the level of staff involvement in the grant process, a shift in
funding for some promotional activities from the General Fund to the Tourism
Business Improvement District for services provided that are primarily to drive
visitation, and the elimination of a tertiary IT ring-down system between fire
stations that is not needed due to the reliability of the primary and secondary
systems.
Travel & Training 11,500
Includes reductions from Network Services for an informational subscription,
Community Services Group Administration for trips and meetings and Economic
Development and DEI programs for community outreach and partnerships to align
budgets with planned expenditures.
Misc Operating 76,743
The department plans to realize $50,000 in savings by modifying the leases for tower
space on Tassajara Peak. The leased tower space provides a redundant microwave
link between facilities within City Limits and water facilities outside the City. The
Ci ty will continue a partnership to co-locate radio facilities with the County to meet
the City's needs for tower space, which eliminates the need for the City's current
lease with a private corporation. Other significant reductions are also within the
Network Services budget and are primarily driven by reductions in software licenses
to align with actual utilization. Smaller reductions include aligning actual expenses
and budget for the Community Academy and a modest reduction in materials and
supplies for Sustainability and Natural Resources.
Total 175,700$
City Attorney's Office
Category Ne t Reduction Description
Staffing 32,003$
A 0.60 Temporary Part-Time FTE Assistant City Attorney position will be replaced
with a 0.75 Regular Part-Time FTE Deputy City Attorney position for a net cost
savi ngs.
Contract Services 26,000
Elimination of a $20,000 budget for a software that has yet to be implemented and
$6,000 for code enforcement matters that can be handled by in-house staff with the
increase from 0.60 FTE Assistant City Attorney to 0.75 FTE Deputy City Attorney.
Travel & Training - All travel and training budgets will be maintained.
Misc Operating 2,850 Modest reduction to a contract with the City's attorneys used for various personnel
investigations.
Total 60,853$
11 Page 277 of 454
Changes from Financial Plan
Community Development Department
Category Net Reduction Description
Staffing 58,450$
Formalize the temporary underfill of the Senior Civil Engineer position with an
Engineer I-III position and adjustments made to the paid advisory body members
budget based on historical usage.
Contract Services 101,350 Primarily driven by reductions to consulting budgets that are typically used to meet
unanticipated needs in the Planning, Engineering, and Building divisions.
Travel & Training 4,825 Reduction to budgets in the Planning and Building divisions typically used to attend
conferences.
Misc Operating 5,500 Various reductions to miscellaneous accounts including office supplies, postage, and
data processing based on historical usage.
Total 170,125$
Finance Department
Category Net Reduction Description
Staffing -$ No staffing changes are recommended.
Contract Services 24,335
Roughly half of this reduction is driven by a renegotiated contract for the budget
software tool. These savings were generated by a reduction in licenses from
unlimited to one per department and with the elimination of several underutilized
modules. Additional savings came from various line items including areas where
staff could reduce dependency on consultants and minor savings in areas where
spending is budgeted annually but not needed every year.
Travel & Training 1,500 Reduction of roughly half of the travel budgets for Finance Administration,
Accounting, and Revenue divisions.
Misc Operating 4,100
Includes the elimination of professional photography for annual reports as well as
the elimination of print and reproduction budgets. Also includes a significant
reduction to memberships and certifications.
Total 29,935$
Fire Department
Category Net Reduction Description
Staffing 453,246$
Elimination of 3.00 Regular Full-Time FTE overhire Firefighter positions. While only
two Firefighter vacancies exist currently, it is anticipated that at least one Firefighter
will qualify for a promotion to Fire Engineer and all three overhire positions will be
vacant. The funding from this reduction will be repurposed to help address
underbudgeted overtime within the Fire Department, and no net reduction will be
realized.
Contract Services - No reductions to Contract Services are recommended.
Travel & Training - No reductions to Travel & Training are recommended.
Misc Operating - No other reductions are recommended.
Total 453,246$
12 Page 278 of 454
Changes from Financial Plan
Human Resources Department
Category Net Reduction Description
Staffing -$ No Staffing changes are recommended.
Contract Services 46,200
Includes elimination of a redundant 401(a) third party administrator contract, non-
renewal of a software contract that is not meeting its intended purpose, reduction in
budget for consultant support of position re-classifications and re-organizations, and
a reduction in the department’s budget for preventative mental health services for
public safety employees, with the City’s joint powers authority agreeing to cover the
cost, maintaining current service levels.
Travel & Training - No reductions to Travel & Training are recommended.
Misc Operating 2,000 Reduction to budget for Public Safety Dispatcher testing software used in the
recruitment and selection process based on recent utilization rates.
Total 48,200$
Police Department
Category Net Reduction Description
Staffing 123,133$
Elimination of the 1.00 FTE Regular Full-Time Data Analyst position which has been
vacant for more than two years. The funding from this reduction will be repurposed
to address underbudgeted overtime in the department and no net reduction will be
realized.
Contract Services - No reductions to Contract Services are recommended.
Travel & Training - No reductions to Travel & Training are recommended.
Misc Operating - No other reductions are recommended.
Total 123,133$
Parks & Recreation Department
Category Ne t Reduction Description
Staffing 28,609$
Reduction to temporary staffing levels for the Facilities division. Includes a 20%
reduction to the budget for Mission Plaza driven by improved logistics of setup and
takedown of dining tables and chairs and locking up equipment for cost savings.
Contract Services 12,963
Includes elimination of funding for Strategic Plan Implementation and certain
contract classes with very low utilization. Also includes reductions in funding for
open space cleanups based on recent historical costs and funding for live music at
special events.
Travel & Training 10,200
Includes a reduction to the Ranger Service division budget, aligning funding with the
anticipated need for commercial driver’s license (Class A) training, as well as roughly
one third of the Parks & Recreation Administration, Community Services, and
Aquatics programs' Education & Training budgets.
Misc Operating 38,270
Includes 23 individual line item reductions largely in areas where actual spending has
typically been lower than budget or are anticipated to decrease in the future.
Reductions are concentracted in the Jack House, Parks Rangers, and Volunteer
Coordinator programs.
Total 90,042$
13 Page 279 of 454
Changes from Financial Plan
FY 2026-27 Significant Operating Budget Changes (SOBCs)
The Supplemental Budget presents an opportunity for departments to adjust their budgets within the
limits set forth by the Financial Plan, using expected savings in certain line items to offset increases
elsewhere. After the budget reduction exercise, General Fund departments were left with little to no
savings to absorb cost increases. In order to minimize the budgetary impact of inflationary cost increases,
departments were required to justify each and every requested cost increase rather than applying inflators
to certain budget line items.
The annual budget is also the appropriate time for departments to request additional funding for new
services, supplies, positions, and programs. Staff carefully evaluate these requests based on determined
need, alignment with City Council and community priorities, and available funding. Following is a summary
of recommended budget changes to address increases to existing costs, as well as recommended
Significant Operating Budget Changes (SOBCs) to add new resources, by fund.
Inflationary adjustments and other cost increases
The inflationary adjustments recommended by staff for non-staffing expenditures are detailed in the table
below, organized by fund and department:
Public Works Department
Category Net Reduction Description
Staffing 83,981$
Elimination of funding for the vacant temporary Engineering Consultant and
Landscape Maintenance Contractor positions previously held by retired annuitants,
which the City no longer employs.
Contract Services 238,550
Budgets for numerous contracts will be reduced in line with actual spending or in
certain cases eliminated. Reductions include outsourced fleet repairs, document
shredding, locksmiths, gutter cleaning, electricians, encampent cleanups, and certain
landscaping contracts. Eliminations include funding for the porta-potty previously
placed directly outside of City Hall.
Travel & Training 9,945
Includes reductions in the Parks Maintenance, Swim Center Maintenance, Urban
Forest Services, Facilities Maintenance, Transportation Planning and Engineering,
and Fleet divisions.
Misc Operating 173,764
Includes some reductions based on recently observed trends including utilities and
chemicals purchases. Also includes elimination of contingencies within certain
operating budgets.
Total 506,240$
Utilities Department (General Fund)
Category Net Reduction Description
Staffing - No staffing changes are recommended.
Contract Services 6,000
Savings were realized through contract renegotiation for a critical stormwater
software.
Travel & Training - No Travel & Training changes are recommended.
Misc Operating 500 Office supplies budget will be reduce in line with historical utilization.
Total 6,500$
14 Page 280 of 454
Changes from Financial Plan
2.3 Inflationary Increases
The process of requesting all cost increases is new to the City. In the past, departments were allowed to
apply inflationary adjustments to broad categories of expenditures, or allowed to increase all line items
below certain thresholds. By undertaking a close review of each cost increase, this more analytical process
saved the General Fund roughly $150,000 as compared to simply applying a three percent increase to all
non-staffing budgets. Commentary below describes the recommended cost increases by fund:
General Fund: Cost increases for the General Fund are broad based in nature. Examples include contracts
renewed at higher rates, like the Fire Department’s contract with PulsePoint to provide live tracking of
incident response to the community, as well as adjustments driven by increased activity, like the cost to
print and mail a growing number of reports and notices.
Water Fund: Budget increases for the Water Fund are primarily attributable to source of supply, or the
City’s cost to procure water. Increased capital costs at the Whale Rock Reservoir are the most significant
driver of this increase.
Sewer Fund: The contract for biosolids hauling at the Water Resource Recovery Facility was recently
advertised and the lowest qualified proposal was higher than the last contract. This cost increase also
reflects contractual fuel surcharges based on rising diesel costs.
Parking Fund: Staff recommend increasing the Parking Fund’s budget for credit card processing fees to
accommodate increased revenue from the new Cultural Arts Parking District Structure.
Transit Fund: Recommended increases for the fund include inflationary adjustments for the price of diesel
fuel as well as the cost of increased mileage from implementation of the Short-Range Transit Plan and a
new contract for transit services including drivers, dispatch, maintenance, and operations.
Fund & Department
General Fund
Administration & IT 53,100$
Community Development 4,667
Finance 9,127
Fire 43,612
HR 5,000
Police 111,812
Public Works 117,000
General Fund Total 344,318$
Water Fund 655,269$
Sewer Fund 192,500$
Parking Fund 80,867$
Transit Fund 258,612$
15 Page 281 of 454
Changes from Financial Plan
New Funding Recommendations
Requests for new funding were carefully scrutinized based on available funding both in the next fiscal
year and in the long term. The following table details the recommended budget changes by fund and
department and includes a summary of one-time vs ongoing funding:
2.4 New Initiatives
The total costs described above indicates the net cost, or the cost after offsets. Offsets include existing
budget for similar services, or unrelated operating expenditures that will be eliminated.
Not Recommended: In light of available funding, not all items requested by departments were included
in staff’s recommendation. The following table highlights the Police Department’s request for a 1.00 FTE
dispatcher position which staff do not recommend in the FY 2026-27 budget, though the position will be
revisited in the next budget year as it was identified as a current need in the Department’s recent staffing
study presented to Council on January 14, 2025:
Department Description Duration Net Cost FTE
General Fund
Administration & IT Pilot - Statistically Valid Community Survey One-time 40,000$ 0.00
Finance User Fee Study One-time 60,000 0.00
Fire Mechanic Helper Reclass Ongoing 12,578 0.00
Police Cellebrite Software Upgrade Ongoing 9,745 0.00
Police Mediation Services Ongoing 30,000 0.00
Police Body Worn and In Car Camera Software Ongoing 95,000 0.00
Public Works Vehicle Telematics Ongoing 38,000 0.00
Public Works Electrical Panel Inspections Ongoing 12,000 0.00
General Fund Total 297,323$
One-time 100,000 0.00
Ongoing 197,323 0.00
Water Fund
Vehicle Telematics Ongoing 10,000$ -
Water Treatment Plant Coverage One-time 148,500 -
Utilities Special Projects Manager Ongoing - 0.50
Water Fund Total 158,500$
One-time 148,500 0.00
Ongoing 10,000 0.50
Sewer Fund
Vehicle Telematics Ongoing 8,000$ -
Utilities Special Projects Manager Ongoing - 0.50
Sewer Fund Total 8,000$
One-time - 0.00
Ongoing 8,000 0.50
Parking Fund
Parking Compliance Officer Conversion Ongoing 14,731$ (0.50)
Parking Fund Total 14,731$
One-time - 0.00
Ongoing 14,731 -0.50
16 Page 282 of 454
Changes from Financial Plan
2.5 Not Recommended
Department Description Duration Net Cost FTE
General Fund
Police Dispatcher Ongoing 118,877$ 1.00
General Fund Total 118,877$ 1.00
Ongoing 118,877 1.00
One-time - 0.00
17 Page 283 of 454
Consolidated Financials – All Major Funds Combined
3.Consolidated Financials – Major Funds Combined
The City uses separate funds to finance its operations. There are five major funds: the General Fund and
four enterprise funds- the Water Fund, Sewer Fund, Parking Fund, and Transit Fund. The General Fund is
the main operating fund for general government operations (public safety, parks and recreation, public
works, community development and general government services) and is primarily funded through
various tax revenues and user fees that are intended to recover the cost of providing specific services that
provide an individual benefit. Enterprise funds are used to account for services that run more like a
business, and are supported by rates and charges paid by the users of those services.
The five major funds are consolidated here and reported on in detail individually throughout the FY 2026-
27 Budget Supplement. Detailed information on the General Fund can be found in the General Fund
Summary. More information on the Water and Sewer Funds can be found in the Utilities Department
Summary. The Public Works Department Summary contains additional information on the Parking and
Transit funds.
Revenues and Expenditures
3.1 Consolidated Revenue
The Citywide budget for FY 2026-27 represents a return to growth for nearly all revenue categories. FY
2024-25 included revenue from long-term financings in the Sewer and Parking funds as well as significant
non-recurring revenue streams in the General Fund including grants and elevated funding from
investments and mutual aid that led to a decline in revenue for FY 2025-26. Growth in FY 2026-27 is a
result of typical economic expansion and inflation.
Actuals Budget Supplement
Citywide FY 2024-25 FY 2025-26 FY 2026-27
Tax & Franchise Revenue 104,775,406$ 105,593,017$ 109,279,584$
Fee & Other Revenue
General Fund 21,988,161 11,638,024 12,530,712
Water Fund 36,128,340 34,409,452 32,178,522
Sewer Fund 25,023,194 21,768,825 23,320,050
Parking Fund 10,783,966 9,575,956 10,444,030
Transit Fund 12,203,451 12,028,459 14,463,072
Other Funds 11,116,639 10,627,752 10,939,802
Total Revenue 222,019,157$ 205,641,485$ 213,155,771$
YoY Change 9%-7%4%
18 Page 284 of 454
Consolidated Financials – All Major Funds Combined
3.2 Consolidated Expenditures by Fund:
Despite increased revenue in FY 2026-27, Citywide expenditures are projected to continue to decline from
their peak in FY 2024-25. This is driven largely by completion of major multi-year projects in the Sewer
and Parking funds and a one-time storm project in FY 2025-26 in the Water Fund. Declines in the General
Fund are attributable to one-time expenditures of unassigned fund balance in FY 2024-25 and FY 2025-26
that may repeat but will not be budgeted for until they occur.
3.3 Consolidated Expenditures by Category:
Staffing expenditures grew rapidly in FY 2025-26 due to a higher than typical $5.1 million Additional
Discretionary Payment to CalPERS as directed by Council with the FY 2025-26 Second Quarter Budget
Report. The budget in FY 2026-27 is lower than typical due to the inclusion in the budget of an assumption
that 3% of staffing budgets will go unspent due to vacancies. This assumption has always been included in
the General Fund long-term forecast and is incorporated into the budget for FY 2026-27 for consistency.
Other Operating Expenditures are projected to decrease in FY 2026-27 due to the above-mentioned storm
damage project in the Water Fund, which was paid consistent with the City’s operating agreement with
the County, as well as the assumption that all balances on open purchase orders will be spent in FY 2025-
26.
Capital Expenditures are projected to increase due to a one-time payment of $5.1 million from the General
Fund to close out the Winter 2023 Emergency Storm Recovery project. The Enterprise Funds are forecasted
to continue their decline in capital expenditures in line with major project completion, most notably the
Cultural Arts District Parking Structure and the Water Resource Recovery Facility.
Debt Service is projected to remain steady as legacy issuances are repaid and no new debts are budgeted
for in FY 2026-27.
Actuals Budget Supplement
Citywide FY 2024-25 FY 2025-26 FY 2026-27
General Fund $123,412,930 $127,344,360 $126,252,275
Water Fund 34,079,992 40,025,258 34,609,926
Sewer Fund 33,602,345 29,034,524 28,169,737
Parking Fund 36,093,130 11,514,112 10,300,258
Transit Fund 12,171,832 9,615,713 14,461,345
Other Funds 7,974,311 9,817,626 10,949,203
Total $247,334,538 $227,351,592 $224,742,744
YoY Change 7%-8%-1%
Actuals Budget Supplement
Citywide FY 2024-25 FY 2025-26 FY 2026-27
Staffing 90,056,786$ 98,067,114$ 99,049,994$
Other Operating Expenditures 60,137,192 66,827,199 59,950,340
Capital Expenditures 82,374,507 47,124,561 50,726,749
Debt Service 14,766,053 15,332,717 15,015,661
Total 247,334,538$ 227,351,592$ 224,742,744$
YoY Change 7%-8%-1%
19 Page 285 of 454
Consolidated Financials – All Major Funds Combined
3.4 Consolidated Sources and Uses:
This table includes all budgeted City funds and is intended to provide insights into the total consolidated
Citywide budget and how use of fund balance impacts budgets.
Use of fund balance in the table above indicates when expenditures are paid for with fund balance
rather than current year revenues. This is typical for multi-year projects where money is borrowed or
otherwise set aside at the beginning of a project and spent down throughout project completion. For
example, the Parking Fund borrowed money in FY 2023-24 which fell to fund balance at year end and
was used over the next two years to pay for construction of the Cultural Arts District Parking Structure.
Fund balance is also used to pay for the typical year-to-year carryover of encumbrances for multi -year
contract services engagements.
Actuals Budget Suppl ement
Citywide FY 2024-25 FY 2025-26 FY 2026-27
Financing Sources
Tax & Franchise Revenue 104,775,406$ 105,593,017$ 109,279,584$
Fee & Other Revenue
General Fund 21,988,161 11,638,024 12,530,712
Water Fund 36,128,340 34,409,452 32,178,522
Sewer Fund 25,023,194 21,768,825 23,320,050
Parking Fund 10,783,966 9,575,956 10,444,030
Transit Fund 12,203,451 12,028,459 14,463,072
Other Funds 11,116,639 10,627,752 10,939,802
Use of Fund Balance 25,315,381 21,710,107 11,586,972
Total Sources 247,334,538$ 227,351,592$ 224,742,744$
Financing Uses by Function
General Fund 123,412,930$ 127,344,360$ 126,252,275$
Water Fund 34,079,992 40,025,258 34,609,926
Sewer Fund 33,602,345 29,034,524 28,169,737
Parking Fund 36,093,130 11,514,112 10,300,258
Transit Fund 12,171,832 9,615,713 14,461,345
Other Funds 7,974,311 9,817,626 10,949,203
Total Uses by Function 247,334,538$ 227,351,592$ 224,742,744$
Financing Uses by Type
Staffing 90,056,786$ 98,067,114$ 99,049,994$
Other Operating Expenditures 60,137,192 66,827,199 59,950,340
Capital Expenditures 82,374,507 47,124,561 50,726,749
Debt Service 14,766,053 15,332,717 15,015,661
Total Uses by Type 247,334,538$ 227,351,592$ 224,742,744$
20 Page 286 of 454
Consolidated Financials – All Major Funds Combined
3.5 Operating Reserves
Operating reserves are funds set aside to continue to fund operations in the event of an emergency causing
the City to exceed its expenditures budget or in the event revenues are not realized as forecasted. The City
Council’s adopted reserve policies call for each major fund to maintain a reserve equivalent to 20% of the
fund’s operating budget.
The table below details operating reserves for the General Fund and four enterprise funds:
Operating reserve levels are set at the beginning of the year based on the initial budget. As such, the
General Fund is at its 20% policy reserve level for the current year and falls to 17% in FY 2026-27 as the
Fund does not currently have a reserve against the annual Unfunded Accrued Liability payments for its
CalPERS pension. Restoring the reserve to 20% funded will be a priority for allocation of future unassigned
fund balance and/or allocation of future reimbursements from the Federal Emergency Management
Agency (FEMA) for unanticipated costs incurred related to the 2023 Winter Storms.
All other major funds are at their policy reserve levels.
Actuals Budget Suppl ement
Operating Reserve FY 2024-25 FY 2025-26 FY 2026-27
General Fund 14,607,203 14,974,278 15,438,344
% of Operating Budget 20%20%17%
Water Fund 5,545,556 6,391,710 5,767,977
% of Operating Budget 20%20%20%
Sewer Fund 4,145,169 4,251,397 4,227,872
% of Operating Budget 20%20%20%
Parking Fund 1,557,229 1,529,383 1,598,678
% of Operating Budget 20%20%20%
Transit Fund 1,026,210 1,198,438 1,474,016
% of Operating Budget 20%20%20%
21 Page 287 of 454
General Fund
4.General Fund Summary
The City has nine departments that provide a full suite of municipal services to the community, plus two
branches within the Public Works and Utilities Department. Eight of the departments are budgeted
entirely in the General Fund, and certain programs in the Public Works and Utilities Department are also
budgeted in the General Fund. Other programs in Public Works and Utilities including Parking,
Transit, Water and Sewer are budgeted in Enterprise Funds which are presented in Section 10:
Department Summaries.
Revenue
The 2025-27 Financial Plan was developed immediately before changes in Federal trade policy led to
concerns about economic growth. During development of the FY 2026-27 budget, uncertainty remains
elevated due to geopolitical tensions.
Despite this, FY 2025-26 revenue performance has held steady. Cyclical revenue streams like Transient
Occupancy Tax have grown more quickly than expected and, for the General Fund as a whole, revenue
reductions from the Financial Plan are not necessary. Discussion on specific changes can be found below,
and more detailed explanations on forecasting methodology can be found in the 2025-27 Financial Plan.
4.1 General Fund Revenue
Actuals Budget Supplement
General Fund FY 2024-25 FY 2025-26 FY 2026-27
Tax & Franchise Revenue
Sales Tax 54,357,111$ 55,470,441$ 56,580,171$
Property Tax 24,923,847 25,944,966 27,112,490
Transient Occupancy Tax 11,417,888 11,099,705 11,495,652
Utility User Tax 7,501,436 6,605,306 7,399,048
Business Tax 3,138,271 3,230,170 3,262,472
Franchise Fees 2,622,351 2,242,429 2,664,697
Cannabis Tax 814,502 1,000,000 765,054
Total Tax & Franchise Revenue 104,775,406 105,593,017 109,279,584
YoY Change 4%1%3%
User Fees
Development Review 5,697,332 4,606,812 5,674,691
Parks & Recreation 2,643,907 2,280,283 2,320,590
Fire 3,331,998 1,759,183 1,744,354
Police 834,584 690,200 690,200
Business Licenses 792,548 632,470 569,125
Total User Fees 13,300,370 9,968,947 10,998,960
YoY Change 5% -25%10%
General Government 7,778,702 1,669,077 1,531,752
2023 Storm Reimbursement 909,090 - -
Total Revenue 126,763,568$ 117,231,041$ 121,810,296$
YoY Change 6%-8%4%
22 Page 288 of 454
General Fund
Sales Tax (including Local Revenue Measure): Immediately after development of the Financial Plan, the
City’s sales tax consultant (HdL) advised that drastic changes in Federal trade policy would present risk of
up to $1.3 million to the sales tax forecast for FY 2025-26. Since then, actual impacts have been less severe
than expected and the current forecast is $0.5 million lower than the Financial Plan.
Property Tax: With the 2025-27 Financial Plan, staff revised forecasting methodology based on historically
observed trends rather than relying on the County Assessor’s forecasts, which have proved conservative
in recent years. While this does increase risk to revenue attainment, actual results have trended in line
with staff projections.
Transient Occupancy Tax (TOT): This revenue stream was adjusted modestly upwards based on continued
growth in local tourism and new hotels opening in the City.
Utility User Tax (UUT): Historically, UUT revenue has been highly volatile and sensitive to the market cost
of commodities, including natural gas. Staff revised UUT forecast upwards based on recent trends. Staff
note that despite increases in commodity costs globally due to the war in Iran, domestic natural gas prices
are well below prior year levels and household energy costs should not be expected to rise.
Business Tax : This revenue stream is budgeted to increase from FY 2024-25 actuals at inflationary rates.
Staff also made minor downwards adjustments to account for the acquisition of taxpaying businesses by
exempt organizations.
Franchise Fees: Franchise Fees have been adjusted modestly upwards based on recent trends. Changes to
solid waste collection fees were the primary driver of this increase.
Cannabis Tax: This revenue stream declined sharply in FY 2024-25 and has continued to decline in the
current year. Staff adjusted the budget downwards from Financial Plan levels with the assumption that
revenue grows from last twelve month actuals at inflationary rates.
Development Review Fees: 2025-27 Financial Plan development coincided with the two lowest revenue
quarters for this revenue stream in recent history. Revenues inflected in the Third Quarter of FY 2024-25,
immediately after Financial Plan development, and staff expect to exceed budget by more than $1 million
in the current year. The FY 2026-27 budget for these fees was increased accordingly, however, this revenue
remains highly volatile. If revenues exceed budget in FY 2026-27, the Community Development
Department will likely need to increase expenditures to meet demand through future budget amendment
requests.
Other User Fee Revenue: User fees have trended above budget during FY 2025-26, largely attributable to
non-recurring revenues. Parks and Recreation fees have benefited from a revised Kinder Gap Care
agreement that staff do not believe will be continued in the next fiscal year. Police and Fire revenue
typically includes grants and mutual aid that is not budgeted until received, making revenue forecasts
appear more conservative than they are. Fee revenue budgets other than Development Review were not
adjusted from the Financial Plan.
General Government: This line item is primarily non-recurring in nature and includes grants, which
generally incur unbudgeted expenditures, and investment income, which is inherently unreliable as an
ongoing funding source. Budgets are set conservatively to avoid structural deficit creation.
23 Page 289 of 454
General Fund
Storm Reimbursement: This line item accounts for the potential receipt of reimbursement from the
Federal Emergency Management Agency (FEMA) and California Office of Emergency Services (CalOES) for
the unbudgeted costs that the City has incurred over the last several years, due to the 2023 Winter Storm
events. The timing and amount of reimbursement is uncertain and outside of the City ’s control, so the
budget does not rely on reimbursement to fund operations in the current year or FY 2026-27.
Expenditures
Inflation has created cost pressures throughout the budget, and the cost to attract and retain a skilled
workforce continues to increase. The budget is an important tool to control costs, and the current budget
was developed with careful scrutiny of every cost increase.
The most salient risk to the expenditure budget is the cost of energy. At the time of budget development,
gasoline prices in California are 28% higher than a year ago and diesel costs are up 51% year over year.
Staff expect that this will flow through to other costs, including contract services, construction, and
materials. If these prices remain elevated, additional funding may be necessary to deliver existing service
levels and planned projects.
4.2 General Fund Expenditures by Type
The table below details operating expenditures for the General Fund by type. The information in the table
below reflects the initial budget for FY 2025-26 in order to exclude the current year budget carried over
from prior years due to encumbrances. This provides a clearer view of trends in the budget.
Staffing is projected to grow less than 2% year over year. These projections include an assumed savings
from vacant positions equal to 3% of staffing budgets, excluding pension debt payments. A vacancy
assumption was previously factored into the long-term forecast, which is used to determine that the
budget is balanced; however, the FY 2026-27 budget has built the salary savings assumption into the
budget directly for clarity purposes. If actual savings from vacancies are less than 3%, the fund will exceed
its staffing budget.
Other operating expenditures are projected to decline by 3%. This is largely a result of the budget
balancing exercise but also reflects the expiration of one-time funding in FY 2025-26 and cost control
efforts in development of the FY 2026-27 budget. Operating budgets will have less flexibility going forward
and significant unexpected expenditures may require reallocation from other planned expenditures or
appropriation of reserves.
Actuals Budget Supplement
General Fund FY 2024-25 FY 2025-26 FY 2026-27
Staffing 75,489,526$ 78,762,988$ 80,187,906$
YoY Change 10% 4% 2%
Other Operating Expenditures 18,291,470 18,493,193 17,908,102
YoY Change -1% 1% -3%
Total 93,780,996$ 97,256,180$ 98,096,008$
YoY Change 8% 4% 1%
24 Page 290 of 454
General Fund
4.3 General Fund Expenditures by Department
The table below includes the General Fund portion of operating budgets of all departments, ordered by
FY 2026-27 funding:
Notably, the non-departmental budget is negative due to the inclusion of the vacancy assumption.
Additional information on departmental budgets can be found in Section 9: Department Summaries.
Interfund Transfers
In order to align the costs and benefits of various City expenditures and support the goals and policies of
the City Council, transfers are made between funds. The following table shows the various funds making
transfers to the General Fund. Additional detail on each transfer can be found below:
Actuals Budget Supplement
Department FY 2024-25 FY 2025-26 FY 2026-27
Police 24,657,118$ 25,598,563$ 26,884,201$
Fire 18,787,150 18,062,912 18,769,292
Public Works 16,581,895 17,428,593 17,922,061
Administration & IT 11,565,191 11,319,639 11,633,200
CDD 7,864,816 8,374,657 8,667,656
Parks & Rec 6,014,160 6,222,696 6,519,221
Finance 2,686,591 2,770,356 3,018,159
HR 2,085,986 2,037,833 2,117,437
City Attorney 1,652,744 1,657,575 1,972,567
Utilities 1,534,804 1,381,663 1,526,352
Non-Departmental 350,542 2,401,694 (934,139)
Total 93,780,996$ 97,256,180$ 98,096,008$
YoY Change 8%4%1%
25 Page 291 of 454
General Fund
4.4 Operating Transfers In
Public Art Fund: Annual operating transfers to the General Fund cover the cost of the Public Art
Coordinator position and annual operating costs for supplies and services.
Gas Tax Fund: Gas tax revenue is received in a separate fund and transferred into the General Fund to be
spent on City roads and transportation infrastructure.
Housing Fund: The Affordable Housing Fund makes an annual transfer to the General Fund to cover its
operating costs, including the cost of the below market rate administrator.
Transportation Impact Fee Fund: This ongoing transfer is made to cover at least half of the debt service
for the obligations incurred to finance the Los Osos Valley Road overpass project.
Tourism Business Improvement District (TBID) Fund: The TBID transfers 2% of its assessment revenue to
the General Fund to cover operating expenses.
Parking Fund: This transfer includes debt service costs on an interfund loan used to acquire the parking
lot at 1166 Higuera and an annual transfer related to construction at the former Garden Street parking lot.
Sewer & Water Funds: These transfers are for right-of-way maintenance costs incurred by the General
Fund as calculated in the cost of services plan.
IT Replacement Fund: This transfer covers the annual cost to administer the EnerGov software tool.
Avila Ranch & San Luis Ranch Community Facilities Districts (CFDs): As called for in their respective
agreements, the CFDs make transfers to reimburse the General Fund for agreed upon costs, such as police,
fire, infrastructure construction and maintenance, and CFD administration.
The General Fund also makes transfers out for certain expenditures detailed in the table below:
4.5 Operating Transfers Out
Operating Transfers In FY 2026-27
From:
Public Art Fund 93,403$
Gas Tax Fund 1,415,380
Housing Fund 207,000
Transportation Impact Fee Fund 280,000
TBID Fund 45,983
Parking Fund 368,920
Sewer Fund 1,054,708
Water Fund 734,607
IT Replacement Fund 152,000
Avila Ranch CFD 276,521
San Luis Ranch CFD 27,602
Total 4,656,123$
26 Page 292 of 454
General Fund
Public Safety Equipment Replacement Fund: These transfers are used to generate a balance to replace
critical public safety equipment at predetermined intervals. By using a replacement fund, the City is able
to set aside funding for significant purchases while shielding General Fund budgets from irregular spending
trends.
Insurance Fund: These transfers cover the cost of workers’ compensation and liability insurance policies
and claims. Any unspent funds can be used to pay for premiums and claims in future years.
Debt Service Fund: Transfers to the debt service fund are made to cover annual debt service payments on
General Fund obligations.
The following table details transfers out of the General Fund, which includes the Local Revenue Measure
Fund, to the various Capital Outlay funds:
4.6 Capital Transfers Out
The City maintains the General Capital Outlay Fund for typical projects as well as other, smaller funds for
unique purposes like tracking asset replacement cycles, segregation of funds for public art, or investments
in upcoming major infrastructure projects.
The transfer to the General Capital Outlay fund includes a recommended transfer of $5,125,068 from the
Assigned Balance of the General Fund to close out the Winter 2023 Emergency Storm Recovery project.
These funds were assigned within the General Fund for this purpose pending payment of invoices on open
purchase orders. All invoices have been paid and the transfer can now be completed.
The Infrastructure Investment Fund was used to fund additional capital projects in FY 2025-26 and the
recommended transfer is a reimbursement of those funds.
The table below details the transfers into the General Fund under the Cost Allocation Plan:
4.7 Reimbursement Transfers In
Operating Transfers Out FY 2026-27
To:
Public Safety Replacement Fund 236,226$
Insurance Fund 6,000,000
Debt Service Fund 1,512,468
Total 7,748,694$
Capital Transfers Out FY 2026-27
To:
General Capital Outlay Fund 28,867,745$
Infrastructure Investment Fund 787,771
IT Replacement Fund 522,228
Public Art Fund 310,000
Fleet Replacement Fund 212,000
Total 30,699,744$
27 Page 293 of 454
General Fund
The Cost Allocation Plan was presented to Council on March 3, 2026, and can be found at the following
link: https://opengov.slocity.org/WebLink/DocView.aspx?id=222284&dbid=0&repo=CityClerk
Long Term Forecast
The long-term forecast is an essential planning tool for the City and its ongoing service delivery. While the
City adopts a two-year Financial Plan that must be balanced, the outer years of the forecast are presented
to show the availability of resources into the future. The forecast is updated at least annually, or when
new information becomes available that suggests that the City’s financial trajectory has materially
changed.
The forecast presented in the 2025-27 Financial Plan indicated that the General Fund would have a
structural deficit beginning in FY 2027-28. This was driven by a slowdown in revenue and the planned cost
to operate a new fire station (fifth fire station in the City). After better than expected revenue growth,
operating expenditure reductions, and a continuation of Capital Expenditures at Financial Plan levels in FY
2027-28 and FY 2028-29 ($1 million lower than previously forecasted), the structural deficit has been
addressed and only a small deficit in FY 2027-28 remains due to the planned opening of the fifth fire
station. The full forecast is shown below:
Reimbursement Transfers In FY 2026-27
From:
Water Fund 1,681,910$
Sewer Fund 1,854,624
Whale Rock Fund 327,855
Parking Fund 1,379,686
Transit Fund 391,973
Total 5,636,048$
28 Page 294 of 454
General Fund
4.8 Long Term Forecast
Significant assumptions in the forecast include:
• Continued economic growth: The City benefits from diversified revenue streams. However, many
of these revenue streams rely on discretionary consumer spending and are therefore cyclical. This
forecast assumes that revenue growth rates remain at typical levels of around 3% per year.
• Energy costs: The current budget includes one-time increases to fuel budgets with the assumption
the current price shock is short lived. No impacts to revenue or other costs are modeled in.
• Staffing costs: Inflation is currently trending at +3.8% year over year as measured by the April 2026
Consumer Price Index. Inflation has led the City and other agencies to increase compensation
Actuals Financial Plan Forecast
FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 FY 2028-29
Tax & Franchise Revenue
Sales Tax 54,357,111$ 55,470,441$ 56,580,171$ 58,116,573$ 60,150,653$
Property Tax 24,923,847 25,944,966 27,112,490 27,925,865 28,903,270
Transient Occupancy Tax 11,417,888 11,099,705 11,495,652 11,840,522 12,254,940
Utility User Tax 7,501,436 6,605,306 7,399,048 7,621,019 7,887,755
Business Tax 3,138,271 3,230,170 3,262,472 3,360,346 3,477,958
Franchise Fees 2,622,351 2,242,429 2,664,697 2,744,638 2,840,700
Cannabis Tax 814,502 1,000,000 765,054 788,006 815,586
Total Tax & Franchise Revenue 104,775,406 105,593,017 109,279,584 112,396,968 116,330,862
User Fees
Development Review 5,697,332 4,606,812 5,674,691 5,844,932 6,049,504
Parks & Recreation 2,643,907 2,280,283 2,320,590 2,390,207 2,473,865
Fire 3,331,998 1,779,183 1,744,354 1,796,685 1,859,569
Police 834,584 754,482 690,200 710,906 735,788
Business Licenses 792,548 632,470 569,125 586,199 606,716
Total User Fees 13,300,370 10,053,229 10,998,960 11,328,928 11,725,441
General Government 7,778,702 2,175,845 1,531,752 1,456,985 1,463,846
2023 Storm Reimbursement 909,090 - - - -
Total Fees & Other Revenue 21,079,071 12,229,074 12,530,712 12,785,914 13,189,287
Total Revenue 126,763,568 117,822,091 121,810,296 125,182,882 129,520,149
Operating Expenditures
Staffing 75,489,526 80,917,096 80,187,905 83,572,802 86,924,827
Other Operating Expenditures 18,291,470 21,702,662 17,908,102 18,135,569 18,125,895
Cost Allocation (5,367,608) (5,671,069) (5,636,048) (5,805,129) (5,979,283)
Total Operating Expenditures 88,413,388 96,948,689 92,459,959 95,903,242 99,071,438
Debt Service 1,757,889 1,724,965 1,512,468 1,515,354 1,513,783
Capital 26,010,000 25,523,604 30,699,744 26,602,020 27,154,060
Other Transfers 7,231,653 3,147,101 1,580,103 1,656,495 1,667,514
Total Expenditures 123,412,930 127,344,360 126,252,275 125,677,111 129,406,796
Revenue - Expenditures 3,350,638 (9,522,269) (4,441,979) (494,229) 113,353
Use of Fund Balance 9,167,831 9,522,269 5,371,068 - -
Surplus / (Deficit)12,518,469$ -$ 929,089$ (494,229)$ 113,353$
29 Page 295 of 454
General Fund
significantly in recent years. This forecast assumes that the City’s staffing costs will increase with
annual 3% cost of living adjustments to salaries. The City has contractual agreements calling for
3% annual salary increases with the Public Safety bargaining units through the end of FY 2026-27
and through FY 2027-28 for all other labor groups. This projection assumes that future agreements
will be negotiated with the same 3% increases.
• Vacancy Rates: Savings attributable to vacant positions are currently trending at 3% of staffing
budgets excluding CalPERS unfunded liability payments, lower than in recent years where 4-7%
was typical. This is projected to continue in FY 2026-27 and the out-years of the forecast assume
a return to 4% savings.
The balanced budget leaves sufficient fund balance for 20% of operating expenditures excluding the
annual CalPERS unfunded liability payment, or 17% of total operating expenditures (including the annual
CalPERS unfunded liability payment) beginning in FY 2026-27, as well as the projected committed and
assigned balances. The excess is shown below as Undesignated Fund Balance available for future
appropriation:
4.9 Forecasted Fund Balance
The $852,508 in undesignated fund balance projected at the end of FY 2026-27 is lower than the annual
budgetary surplus of $929,089 because the growing operating expenditures budget necessitates an
increase in the operating reserve.
Fund balance is generated by revenue and used by expenditures. When revenues exceed expenditures,
fund balance increases, and vice versa.
Changes in Committed & Assigned Funds impact the Undesignated Fund Balance. When the Committed &
Assigned Funds increase, this reduces Undesignated Fund Balance, and vice versa. These changes cannot
always be predicted.
Each year, certain amounts are designated as Committed based on accounting rules and other binding
commitments made by the City, such as the operating reserve and segregation of Local Revenue Measure
Funds. Committed funds also include non-spendable, noncash assets like the interfund loan made to the
Parking Fund. The City uses Assignments, which are dictated by the City Manager, to set aside certain other
balances like contingent grants to outside organizations and the AB 939 regulated funds used for solid
waste and recycling programs. At year end, any unspent balances on purchase orders are assigned for
expenditure in the next fiscal year.
The table below illustrates this interaction for the next fiscal year:
Actuals Financial Plan Forecast
FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 FY 2028-29
Ending Fund Balance 46,447,466$ 36,925,197$ 32,483,218$ 31,988,988$ 32,102,342$
Operating Reserve 14,607,203 14,974,278 15,438,344 16,010,034 16,470,510
Committed & Assigned Funds 28,371,308 21,563,433 16,192,365 16,192,365 16,192,365
Undesignated Fund Balance 3,468,954$ 387,486$ 852,508$ (213,411)$ (560,534)$
Reserve Level 20%20% 17%17% 17%
30 Page 296 of 454
General Fund
4.10 Fund Balance Detail
The non-spendable line includes non-cash assets which are properly included in fund balance but cannot
be spent due to their non-cash nature. These assets are an interfund loan to the Parking Fund to finance
the purchase of property located at 1166 Higuera and prepaid insurance premiums.
The Storm Related Reimbursements line represents funds received from the Federal Emergency
Management Agency and California Office of Emergency Services to reimburse the General Fund for costs
incurred to repair damage caused by the winter 2023 storms. This is the balance from FY 2024-25 and will
be adjusted each year as additional funds are collected or appropriated.
Fund Balance FY 2026-27
Beginning Fund Balance 36,925,197$
+Revenue 121,810,296
-Expenditures (126,252,275)
Ending Fund Balance 32,483,218
-Committed
Operating Reserve 15,438,344
Local Revenue Measure 848,111
Non-spendable 5,533,017
Subtotal 21,819,472
-Assigned:
SLO Rep Theater Grant 6,700,000
Revenue Stabilization Reserve 2,000,000
Solid Waste AB939 237,147
Storm Related Reimbursements 874,090
Subtotal 9,811,237
Unassigned Fund Balance:852,508$
31 Page 297 of 454
Special Revenue & Other Funds
5.Special Revenue and Other Funds Summary
In addition to the General Fund and Enterprise Funds, the City maintains a number of Special Revenue
Funds, Internal Service Funds, and Asset Replacement Funds. Like all funds, these are used to segregate
money for specific purposes. Budgets for each fund and information on their purpose is included below.
These tables are reported on an initial budget basis, rather than as modified, to provide a clear trend of
annual expenditures.
Avila Ranch CFD No. 2017-1
A Mello-Roos Community Facilities District (CFD) was established and approved by City Council on October
24, 2017 (Resolution No 10844), pursuant to section 5.02 of the Avila Ranch Development Agreement.
The CFD boundaries are identical to that of the Avila Ranch Development project and located at the
northeast corner of Buckley Road and Vachell Lane. The Avila Ranch Project will include up to 720
dwelling units, 15,000 square feet of office and retail, 18 acres of parks, 53 acres of open space, riparian
corridors and farmed agricultural land. The CFD was formed with purpose of funding services as well as
facilities of the CFD. Services to be funded can include the maintenance and lighting of parks, parkways,
streets, roads, and open space; flood and storm protection services; police & fire protection services;
maintenance and operation of real property. Facilities to be funded can include park, recreation, parkway,
and open space facilities; construction and undergrounding of utilities (water, natural gas, telephone lines,
electric, cable television); and the acquisition, improvement, or rehabilitation of real property.
5.1 Revenue
The CFD’s revenues are projected to grow rapidly as development continues. This growth is expected to
taper as the project nears completion.
The table above shows the estimated levy for the fund. The City’s consultants will complete their analysis
to be used for actual tax levies shortly after budget adoption and, if needed, the budget will be revised.
These revisions are typically minor and do not impact expenditures.
5.2 Expenditures
Actuals Budget Supplement
Avila Ranch CFD FY 2024-25 FY 2025-26 FY 2026-27
Tax Revenue 560,516$ 792,617$ 942,663$
Total Revenue 560,516$ 792,617$ 942,663$
YoY Change 108%41%19%
Actuals Budget Supplement
Avila Ranch CFD FY 2024-25 FY 2025-26 FY 2026-27
Authorized Expenditures 50,435$ 91,293$ 152,675$
Transfers 386,517 234,122 301,521
Total Expenditures 436,952$ 325,415$ 454,196$
YoY Change 644% -26%40%
32 Page 298 of 454
Special Revenue & Other Funds
The CFD made reimbursement transfers to the General Fund for eligible expenditures including police
protection, fire protection, and administrative expenses for the first time in FY 2024-25 and was larger
than the proposed FY 2026-27 transfer because it included prior year balances. Transfers going forward
are calculated based on the expected costs to provide eligible services.
Other authorized expenditures can include the maintenance and lighting of parks, parkways, streets,
roads, and open space; flood and storm protection services; maintenance and operation of real property
and are projected to increase as the development matures and maintenance activities become necessary.
San Luis Ranch CFD No. 2019-1
A Mello-Roos Community Facilities District was established and approved by City Council on April 16, 2019
(Ordinance No 1661), pursuant to section 5.02 of the San Luis Ranch Development Agreement. The
boundaries of the CFD are identical to the San Luis Ranch Specific Plan and includes 131.4 acres
approved for up to 580 dwelling units and commercial development, a 200-room hotel, 100,000 square
feet of office space, 150,000 square feet of retail space, 7.8 acres of parks/ open space, and 52.3 acres of
farmed agriculture land. The purpose of the CFD is to fund major road improvements, potable and non-
potable water system improvements, drainage system improvements, wastewater system improvements,
solid waste improvements, park and paseo improvements, open space improvements, and utilities.
5.3 Revenue
Revenue is projected to decline despite typical annual growth in taxes. The fund historically has not
budgeted for investment income on its cash balances, but once earned , these funds are available for future
appropriation on eligible expenditures, however much of the investment income will be used to meet
arbitrage compliance obligations to the U.S. Internal Revenue Service (IRS).
The table above shows the estimated levy for the fund. The City’s consultants will complete their analysis
to be used for actual tax levies shortly after adoption and if needed, the budget will be revised. These
revisions are typically minor and do not impact expenditures.
5.4 Expenditures
Actuals Budget Supple ment
San Luis Ranch CFD FY 2024-25 FY 2025-26 FY 2026-27
Tax Revenue 1,345,180$ 1,360,981$ 1,395,512$
Investment Income 566,745 - -
Total Revenue 1,911,925$ 1,360,981$ 1,395,512$
YoY Change 2%-29%3%
Actuals Budget Supplement
San Luis Ranch CFD FY 2024-25 FY 2025-26 FY 2026-27
Authorized Expenditures 181,313$ 336,956$ 727,018$
Transfers 245,664 207,243 135,910
Debt Service 927,450 946,700 964,200
Total Expenditures 1,354,427$ 1,490,899$ 1,827,127$
YoY Change 47%10%23%
33 Page 299 of 454
Special Revenue & Other Funds
Authorized expenditures include debt service, administration, and payments to the developer. The Fund’s
primary expenditure is for debt service on a bond issued to fund eligible improvements. The FY 2026-27
budget also includes a significant authorized expenditure for tax arbitrage payments, which are required
when amounts borrowed on a tax preferred basis are invested prior to use on eligible projects.
The fund also budgets for transfers to the General Fund for administration costs and transfers to a capital
fund for infrastructure costs.
Tourism Business Improvement District
The City established a Tourism Business Improvement District (TBID) as requested by the local lodging
industry in 2008. The district levies an assessment equal to 2% of the lodging industry’s gross receipts for
the purpose of tourism promotion for the benefit of the district’s constituents. The assessment is a special
revenue and is administered in a separate and distinct fund.
5.5 Revenue
Revenues for the TBID are forecasted in line with the General Fund’s Transient Occupancy Tax. Strength in
local tourism and newly opened hotels have benefited both the General Fund and the TBID in recent years.
5.6 Expenditures
The TBID sets its initial expenditures budget equal to anticipated revenue. This budget provides for staff
to oversee the program, consultants to provide marketing and public relations services, and transfers to
the General Fund to help offset overhead and administration costs. These expenditures are directed by
the TBID Board and can be amended throughout the year as opportunities arise.
Boysen Ranch Conservation Fund
Boysen Ranch consists of approximately 116 acres bounded by Los Osos Valley Road, Foothill Boulevard,
and O’Connor Way. In 2005, the City accepted and currently holds a series of conservation easements that
protect approximately 25 acres at the Boysen Ranch to mitigate for impacts to wetlands and waters by the
Home Depot, Costco, and other Irish Hills Plaza development projects on Los Osos Valley Road. Boysen
Actuals Budget Supplement
TBID FY 2024-25 FY 2025-26 FY 2026-27
Assessments 2,304,764$ 2,219,941$ 2,299,130$
Total Revenue 2,304,764$ 2,219,941$ 2,299,130$
YoY Change 2%-4%4%
Actuals Budget Supple ment
TBID FY 2024-25 FY 2025-26 FY 2026-27
Staffing 241,390$ 263,115$ 300,764$
Other Operating Expenditures 1,911,188 1,912,427 1,952,383
Transfers 44,914 44,399 45,983
Total Expenditures 2,197,492$ 2,219,941$ 2,299,130$
YoY Change 1%1%4%
34 Page 300 of 454
Special Revenue & Other Funds
Ranch is part of the City’s designated greenbelt. The funding was set up as an endowment to fund
monitoring and maintenance of the restored wetland area.
5.7 Revenue
Relative to recent years, the budget for investment income has been set conservatively. Excess income will
be reinvested and future earnings will be available for expenditure.
5.8 Expenditures
The fund budgets for authorized conservation expenditures including restoration, maintenance, and
monitoring of the Boysen Ranch wetlands. Unspent funds are available for appropriation in future years.
Downtown SLO Business Improvement District
The Downtown Business Improvement District (DBID) was established in 1975 as a parking and promotions
district for the City’s downtown area. As a special fee district, fees are collected from business license
holders operating within the designated area and revenue supports the operations of Downtown SLO, a
non-profit organization. The City and Downtown SLO (DSLO) agreed by contract that DSLO would provide
various services for the economic, social, cultural, and environmental vitality and beautification of
downtown San Luis Obispo. The assessment is a special revenue and is administered through a separate
and distinct fund.
5.9 Revenue
Revenues are projected to exceed budget in FY 2025-26 and have been increased accordingly in FY 2026-
27.
Actuals Budget Supplement
Boysen Ranch FY 2024-25 FY 2025-26 FY 2026-27
Investment Income 20,157$ 7,500$ 7,500$
Total Revenue 20,157$ 7,500$ 7,500$
YoY Change 10%-63%0%
Actuals Budget Supplement
Boysen Ranch FY 2024-25 FY 2025-26 FY 2026-27
Authorized Expenditures 5,023$ 7,500$ 7,500$
Total Expenditures 5,023$ 7,500$ 7,500$
YoY Change -45%49%0%
Actuals Budget Supplement
Downtown FY 2024-25 FY 2025-26 FY 2026-27
Assessments 319,277$ 246,713$ 294,997$
Total Revenue 319,277$ 246,713$ 294,997$
YoY Change 20%-23%20%
35 Page 301 of 454
Special Revenue & Other Funds
5.10 Expenditures
100% of collected assessments are passed through to Downtown SLO to support their operations. The
current budget appears much higher than FY 2024-25 actuals due to an accounting error in prior years
that has since been rectified.
Insurance Fund
The Insurance Fund and Risk Management Program aim to protect the organization through risk transfer,
risk control and risk avoidance. Safety in the workplace and in the community is promoted by minimizing
accidents, reducing liabilities and associated costs. The City maintains an Insurance Fund for the purpose
of paying its annual premiums for liability, workers’ compensation, special events, volunteer, property, and
other insurances needed to protect the City and to manage the fluctuations in claims-related
expenses. The Insurance Fund is managed by the Human Resources Department which runs the City’s
Risk Management Program.
5.11 Revenue
The General Fund provides support for the Insurance Fund via interfund transfers. In addition to the $6
million budgeted annual transfer, as part of the FY 2025-26 Second Quarter Budget Report to the City
Council in February, the City Council approved a transfer of $802,798 from General Fund Unassigned Fund
Balance to increase fund balance to policy levels equal to 150% of the last five years of claims. Based on
advice from the City’s consultants, an additional $3.1 million beyond the $802,798 is needed to meet the
actuarial basis reserve level. This actuarial basis level is developed by consultants based on future claims
that the City may face.
Staff plan to recommend allocation of General Fund Unassigned Fund Balance in future years to the
Insurance Fund to meet actuarial reserve levels and evaluate the need for higher ongoing transfers to meet
premium increases.
Actuals Budget Supplement
Downtown FY 2024-25 FY 2025-26 FY 2026-27
Authorized Expenditures 185,341$ 246,713$ 294,997$
Total Expenditures 185,341$ 246,713$ 294,997$
YoY Change -53%33%20%
Actuals Budget Supplement
Insurance FY 2024-25 FY 2025-26 FY 2026-27
Transfers in 6,000,000$ 6,000,000$ 6,000,000$
Total Revenue 6,000,000$ 6,000,000$ 6,000,000$
YoY Change -6%0%0%
36 Page 302 of 454
Special Revenue & Other Funds
5.12 Expenditures
Expenditures include annual premiums, member contributions to California Joint Powers Insurance
Authority and claims expenses within the self-insured retention limit. In recent years, claims and premiums
have been well below budgeted amounts, as indicated by the large year over year increase from FY 2024-
25 actuals to the FY 2025-26 budget. Any savings relative to budget will increase the fund balance available
to pay future claims. For FY 2026-27, the transfer in is slightly less than the total expenditures budget and
staff will need to evaluate the appropriate ongoing annual transfer amount with the next Financial Plan.
Public Safety Equipment Replacement Fund
The Public Safety Equipment Fund (PSEF) was created with adoption of the 2019-21 Financial Plan to help
budget and forecast the replacement of Public Safety equipment that has expired or become damaged.
The Fund received an original seed amount in FY 2019-20 and going forward, an annual allocation is made
from the General Fund. Budgeting annual amortized amounts set aside in this project account allows for
crucial public safety equipment to be replaced at scheduled intervals, which smooths out the annual
contribution, reducing the impact on the budget at time of replacement.
5.13 Revenue
In recent years, including FY 2024-25, the fund received one-time transfers in to build fund balance, make
additional purchases, and add equipment to the replacement schedule. This one-time funding has lapsed
and transfers from the General Fund will continue at this lower level unless replacement costs increase or
new equipment is added to the replacement schedule.
Actuals Budget Supple ment
Insurance FY 2024-25 FY 2025-26 FY 2026-27
Workers Comp 774,732$ 2,069,183$ 2,355,887$
Liability & Other 3,020,344 3,457,975 3,710,366
Total Expenditures 3,795,076$ 5,527,158$ 6,066,253$
YoY Change -20%46%10%
Actuals Budget Supplement
Public Safety FY 2024-25 FY 2025-26 FY 2026-27
Transfers in 387,334$ 236,226$ 236,226$
Total Revenue 387,334$ 236,226$ 236,226$
YoY Change -1%-39%0%
37 Page 303 of 454
Special Revenue & Other Funds
5.14 Expenditures
Budgeted expenditures for the fund are based upon the replacements scheduled in each year and may
exceed or fall short of transfers into the fund in any given year. This allows for general fund expenditures
to remain consistent year over year while volatility from costly purchases is managed within the
replacement fund.
Actuals Budget Supplement
Public Safety FY 2024-25 FY 2025-26 FY 2026-27
Equipment Purchases 307,329$ 196,200$ 298,100$
Total Expenditures 307,329$ 196,200$ 298,100$
YoY Change -49% -36%52%
38 Page 304 of 454
Local Revenue Measure
6.Local Revenue Measure
The Local Revenue Measure (LRM) is a 1.5 percent local sales tax approved by City voters in November
2020 that went into effect on April 1, 2021. It replaced the previous 0.5 percent local sales tax approved
by City voters in November 2014. The revenue provided by this measure has become instrumental in
building and maintaining public infrastructure and delivering critical operating programs to address
emerging needs identified by the community.
Local Revenue Measure Ballot Language (G-20)
“To protect City of San Luis Obispo’s financial stability; maintain fire/community safety, health
emergency/disaster preparedness; protect creeks from pollution; address homelessness; keep public
areas clean/ safe; retain local businesses; maintain youth/senior services, streets, open space/natural
areas, and other general services, by extending voter- approved funding at a 1.5¢ rate, providing
approximately $21,600,000 annually until ended by voters; requiring audits/ all funds used locally”
Revenue Forecast
The Local Revenue Measure forecast for FY 2026-27 was provided by the City’s sales tax consultants in
April 2026 based on actual results through December 2025. This forecast is based on data segmented at
the industry group level with unique growth rates for each, and factors in known business openings and
closures.
The forecast, detailed below, assumes modest growth rates in the current fiscal year and the next after
several years of sub inflationary growth.
6.1 Revenue
Budget by Priority
The City is careful to align LRM funding allocations with community priorities. These allocations change
year to year based on emerging needs, large scale projects, and project readiness. The City’s Revenue
Enhancement Oversight Commission (REOC) is an advisory body made up of five members of the
community who are responsible for reviewing staff recommendations relative to the use of LRM dollars to
ensure compliance with the priorities identified in the ballot language. The REOC reviewed the
recommended use of LRM dollars in FY 2026-27 at their meeting on April 23, 2026. The total allocations
of LRM funds for operating and capital expenditures are detailed in the table below:
Actuals Budget
FY 2024-25 FY 2025-26 FY 2026-27
Local Revenue Measure 30,926,285$ 31,572,000$ 32,284,000$
YoY Growth 1.1% 2.1%2.3%
39 Page 305 of 454
Local Revenue Measure
6.2 Total Budget by Priority
These priorities also receive funding from other sources including the General Fund, grants, and in some
cases, certain enterprise funds.
Changes from Financial Plan
The priority allocations above reflect the community’s feedback from development of the 2025-27
Financial Plan. Changes to recommended operating budget allocations since plan development reflect
typical year-to-year changes in salaries and benefits and employee turnover. Changes to Capital
Improvement Program (CIP) budget allocations are based project readiness and available resources.
Detailed budget allocations are listed in the tables below.
6.3 Capital Expenditures Budget:
Capital expenditures develop or maintain long term assets for community benefit. The tables below detail
funding by project for capital expenditures:
Total Budget by Priority Operating Capital Total % of Total
Street Maintenance and Transportation 981,403$ 7,205,000$ 8,186,403$ 25%
Community Safety and Emergency Preparedness 3,757,860 1,901,133 5,658,993 18%
Creek and Flood Protection 275,768 5,318,315 5,594,083 17%
Protect Financial Stability 753,592 4,000,000 4,753,592 15%
Youth/Senior Services and Recreational Facilities 1,147,279 1,822,500 2,969,779 9%
Open Space/Natural Areas Preservation and Maintenance 1,062,134 743,500 1,805,634 6%
Address Homelessness 992,462 - 992,462 3%
Other Services and Projects 901,122 - 901,122 3%
Economic Development and Business Retention 334,420 440,000 774,420 2%
Safe and Clean Public Areas 217,511 430,000 647,511 2%
Total 10,423,552$ 21,860,448$ 32,284,000$ 100%
40 Page 306 of 454
Local Revenue Measure
41 Page 307 of 454
Local Revenue Measure
6.4 Operating Expenditures Budget:
Operating expenditures support the services and programs provided by the City. These include staff
positions, contracted services provided by third parties, and other tools used by staff. The tables below
detail operating expenditures by priority:
42 Page 308 of 454
Local Revenue Measure
43 Page 309 of 454
Local Revenue Measure
6.5 Local Revenue Measure Investments in Downtown
The City regularly allocates Local Revenue Measure dollars to support initiatives to support the safety,
cleanliness and vibrancy of the downtown area. The table below includes a subset of Local Revenue
Measure expenditures noted above that are focused on supporting the downtown area. Many other
expenditures benefit the downtown area but not exclusively.
In addition to the above noted expenditures, the first of quarter local revenue measure funds collected
(April 1 – June 30, 2021) provided $2 million in seed funding for economic development initiatives that
have primarily been used to benefit the downtown like the buy local bonus and implementation of the
Economic Development Strategic Plan.
Downtown Expenditures FY 2026-27
Sidewalk Replacement and Cleaning 250,000$
Downtown Sidewalk Pressure Washing 17,000
Mission Plaza Railing Upgrade 35,000
Recycling-Solid Waste Big Belly in Downtown 85,000
Police Community Service Officers (FTE=4)478,215
Police Officer (FTE=4)782,849
Police Sergeant (FTE=1)264,249
Economic Development Analyst (FTE=1)107,420
Downtown Holiday Activation Support 150,000
Enhanced Downtown Cleaning 60,000
Beautification Gardener (FTE=1)111,724
Total 2,341,457$
44 Page 310 of 454
Debt Service
7.Debt Service
Debt financing plays an important role in helping the City build and maintain its infrastructure without
diverting current revenues to pay for future projects. Staff carefully evaluate debt financing proposals to
prudently manage the City’s debt burden and ensure that costs and benefits are aligned with debt
paydown schedules. Debt service costs listed below include both interest and principal payments on the
City’s outstanding debt balances expected at the end of FY 2025-26. In each fund with outstanding debts,
the relevant fund summary will include a line item labeled “Debt Service” with a budget for these amounts.
The tables below include the abbreviated official names from the initial issuance documents with
reference to the projects they financed. In many cases, issuances are refunded or refinanced after issuance
and the debts are no longer directly attributable to a specific project. These issuances are described below
as “refunding” bonds.
7.1 General Fund
The 2018 refunding lease revenue bond was issued to refund the outstanding 2005 revenue refunding
bonds and the 2006 and 2009 lease revenue bonds, which were originally issued to construct several high
priority capital improvement projects and to finance the costs of acquisition and construction of public
parking facilities, and the public safety communications and emergency operations center project.
The 2023 refunding lease revenue bond was issued for the construction of the Cultural Arts District Parking
Structure and to refund the 2012 lease revenue bonds, which refunded several other issuances.
Current debt service levels are equal to 1.2% of General Fund revenue. The City’s Debt Management Policy,
last updated on November 15, 2022, dictates that general purpose annual debt service payments generally
should not exceed 10% of General Fund revenue; and in no case should they exceed 15%. These limits are
detailed in the table below:
7.2 Debt Limits
City Policy also limits direct debt to 2% of assessed valuation and provides that no more than 60% of capital
improvement outlays will be funded from long-term financings. Based on the approximate assessed value
of properties in the City of $14.3 billion, this policy limits total General Fund borrowings to $286 million.
Debt Issue - Asset Outstanding Principal Debt Service Retirement
2014 lease revenue bond - LOVR overpass $5,670,000 $421,231 2044
2018 lease revenue bond - refunding 6,225,775 721,487 2039
2023 lease revenue bond - refunding 1,360,000 369,750 2029
Total $13,255,775 $1,512,468 2044
Policy Limits Debt Service
10% of Revenue 12,181,030$
15% of Revenue 18,271,544$
45 Page 311 of 454
Debt Service
7.3 Water Fund
The 2018 refunding lease revenue bond was issued to refund the outstanding 2005 revenue refunding
bonds and the 2006 and 2009 lease revenue bonds, which were originally issued to construct several
high priority capital improvement projects and to finance the costs of acquisition and construction of
public parking facilities, and the public safety communications and emergency operations center project.
The 2018 refunding revenue bond was issued to refund the 2006 water revenue bonds, which were
originally issued to fund improvements to the water treatment plant.
7.4 Sewer Fund
The 2018 refunding lease revenue bond was issued to refund the outstanding 2005 revenue refunding
bonds and the 2006 and 2009 lease revenue bonds, which were originally issued to construct several high
priority capital improvement projects and to finance the costs of acquisition and construction of public
parking facilities, and the public safety communications and emergency operations center project.
The City recently made final drawdowns on the Water Resource Recovery Facility (WRRF) upgrade loan
and is awaiting final debt service schedules. As a result, the Sewer Fund debt service budget is currently
based on estimates and actual debt service costs may vary modestly from budgeted amounts.
7.5 Parking Fund
The 2018 refunding lease revenue bond was issued to refund the outstanding 2005 revenue refunding
bonds and the 2006 and 2009 lease revenue bonds, which were originally issued to construct several high
priority capital improvement projects and to finance the costs of acquisition and construction of public
parking facilities, and the public safety communications and emergency operations center project.
Debt Issue - Asset Outstanding Principal Debt Service Retirement
2018 lease revenue bond - refunding 180,595$ 20,929$ 2039
2018 revenue bond - refunding 6,300,000 885,000 2035
2020 state I-Bank loan - water treatment plant 10,724,120 949,476 2040
Total $17,204,715 $1,855,405 2040
Debt Issue - Asset Outstanding Principal Debt Service Retirement
2009 state I-Bank loan - farm lift station 5,272,953$ 531,716$ 2038
2014 US Bank wastewater lease agreement 1,770,696 632,872 2029
2018 lease revenue bond - refunding 199,605 26,399 2039
2019 SRF loan - WRRF upgrade 129,359,242 5,899,110$ 2053
Total $136,602,496 $7,090,097 2053
Debt Issue - Asset Outstanding Principal Debt Service Retirement
2001 state I-Bank loan - Marsh St. garage 1,866,113$ 409,682$ 2031
2018 lease revenue bond - refunding 2,684,000 359,684 2039
2023 lease revenue bond - refunding 41,075,000 2,824,125 2053
2023 interfund loan - 1166 Higuera 4,723,924 260,612 2053
Total $50,349,036 $3,854,103 2053
46 Page 312 of 454
Debt Service
The 2023 refunding lease revenue bond was issued for the construction of the Cultural Arts District Parking
Structure and to refund the 2012 lease revenue bonds, which refunded several other issuances.
47 Page 313 of 454
1
Capital Improvement Plan (CIP)
Fiscal Year 2026-27
Purpose of CIP
The Capital Improvement Program (CIP) enables the City to plan, schedule, and finance capital projects to
ensure cost effectiveness and conformance with established plans and policies. The City’s budget process
guides the capital priorities through community input, Council goal setting, Local Revenue Measure
priorities, and the biennially adopted Major City Goal work programs.
Through its adopted CIP, the City meets community needs by providing infrastructure that supports
economic vitality, neighborhood wellness, housing, transportation, sustainability, recreation, public
safety, cleanliness, and other basic public amenities. The City’s fiscal policies govern development and
management of the CIP. In accordance with those policies, all construction projects and equipment
expenditures of $25,000 or more are included within the program.
During the 2025–2027 financial planning process, the City established a two-year Capital Improvement
Program (CIP) budget totaling $112 million. One year into the cycle, the Supplemental Budget includes a
recommended CIP Budget Alignment to ensure funding is consistent with current project scopes,
construction schedules, and delivery capacity.
The recommendations also reflect projects progressing from planning into design and construction
phases, where implementation requirements and cost estimates are now more clearly defined.
Major Completed and Ongoing Projects
Significant progress has been made during the first year of the Financial Plan, including completion of the
Cultural Arts District Parking Structure, 2025 Roadway Paving Project, Water Resource Recovery Facility,
and Mid-Higuera Bypass Project, as well as substantial progress on the Mission Plaza Enhancement Project
and continued design of the Prado Bridge Widening and Prado Interchange Projects.
In the first year of the Financial Plan, staff completed 13 projects and brought 12 projects into
construction. The following provides more detailed progress information on several upcoming capital
projects.
Higuera Complete Streets
The Higuera Complete Streets Project was advertised for construction bids in spring of 2026, with a
pending bid opening date scheduled for early June. Assuming responsive bids are received within current
project funding limits, construction start is targeted for late summer 2026. Construction is anticipated to
take approximately 12 months, including procurement lead times for long-lead equipment such as traffic
signal poles. Staff are currently refining a project communications plan that will involve proactive
communications to the community and key stakeholders, such as emergency services providers and local
businesses located within the project vicinity, prior to and during construction.
48 Page 314 of 454
2
California and Taft Roundabout
The California and Taft Roundabout project is continuing to progress through the eminent domain legal
process to acquire the right-of-way needed to construct the project. Final review of project plans and
specifications is currently underway, and staff expect to have the legal rights to proceed with construction
of the project as soon as fall 2026. Current plans are to advertise the project for construction bids fall of
2026, with construction targeted to start March 2027 and continue for approximately 8 months. The March
start date avoids winter weather impacts and results in most construction activities occurring over the
spring and summer months when traffic impacts will be reduced due to Cal Poly being out of session for
the summer.
Updated construction cost estimates indicate the California and Taft Roundabout Project requires
approximately $2.5 million in additional funding to fully fund construction. Staff have identified unreserved
Transportation Impact Fee funding for appropriation, as well as Completed Projects funding available to
transfer to this project. Approximately 90% of the additional funding request is proposed from
Transportation Impact Fee (TIF) sources, with the remaining balance funded through transfers from
completed Local Revenue Measure-funded projects and newly appropriated Capital Outlay Funds. The
table below provides a summary of the requested funding appropriations and transfers, which are further
shown within the CIP Budget Alignment subsection.
California and Taft Supplemental Funding
California & Taft Funding Additional Funding
2091503-00 - California & Taft Roundabout $2,500,000
New Appropriation $2,014,659
Local Revenue Measure (Capital Outlay 401) $150,000
SLR Transportation Development Impact Fee (514) $502,951
Transportation Impact Fee (Transportation Impact Fee 507) $1,361,708
Transfer (from Completed Projects) $485,341
Local Revenue Measure (Capital Outlay 401) $143,306
Transportation Impact Fee (Transportation Impact Fee 507) $342,035
California & Taft Funding
Previous
Allocation/Approved
Remaining Budget (Current Balance) $431,398
Local Revenue Measure (Capital Outlay 401) $85,274
SLR Transportation Development Impact Fee (514) $346,124
2025-2027 Financial Plan Year 2 Appropriation $3,650,000
Local Revenue Measure (Capital Outlay 401) $2,250,000
SLR Transportation development Impact Fee (514) $1,400,000
Grand Total (Previous and New) $6,581,398
49 Page 315 of 454
3
Prado Road Interchange
The Prado Road Interchange Project in San Luis Obispo is a legacy Capital Improvement Project that plays
a crucial role in the City's infrastructure development. This project will construct a bridge over US 101,
connecting Prado Road to Dalidio Drive and establishing a continuous transportation link between S.
Higuera Street and Madonna Road. The project aligns with major City goals such as Housing and
Homelessness, Climate Action, Open Space, and Sustainable Transportation, and has been long-identified
as a necessary circulation improvement in the City’s General Plan.
On November 4, 2025, Council provided direction regarding the value analysis items to be incorporated
into the Plans, Specifications, and Estimates (PS&E) phase of the project. Council’s direction initiated the
process of incorporating the approved value analysis recommendations into the project design, including
completion of the technical studies, updated traffic and operational analyses, permitting coordination,
and engineering refinements necessary to advance the project into the PS&E phase.
This work forms the foundation of the Supplemental Project Report (SPR), which is required by Caltrans
to document the proposed changes and secure concurrence prior to proceeding further in design. On
March 11, 2026, a community meeting was held at the Pavilion at San Luis Ranch to inform the public
about the project in plain language and provide an opportunity for questions and feedback. The
community’s feedback on the project and the SPR will be presented to the Active Transportation
Committee (ATC) on May 20, 2026, for review and consideration of any recommendations the ATC may
wish Council to consider. The SPR is currently scheduled to return to Council on August 4, 2026, for
consideration and approval prior to formal submittal to Caltrans. The table below presents key upcoming
project milestones.
Prado Interchange Milestone Tracker
Milestone Status Tracker Status Target Completion Date
PHASE I: Value Analysis In Progress August 2026
PHASE II: PS&E Development Pending May 2029
PHASE III: Bid, Advertisement, & Award Pending August 2029
PHASE IV: Construction Pending August 2031
Prado Creek Bridge
The current bridge over San Luis Obispo Creek at Prado Road is functionally obsolete, structurally
deficient, and cannot accommodate the City’s multi-modal needs. This project proposes to replace the
bridge with a wider bridge while protecting San Luis Obispo Creek banks from erosion. Additionally, the
intersection at Prado and South Higuera will be widened with protective features for bicycles and
pedestrians to operate in conjunction with the widened bridge. The project includes undergrounding of
all overhead utilities in the area to provide a more aesthetic and resilient corridor.
The consultant team is advancing the project toward completion of the 95% contract documents while
continuing right-of-way acquisition, utility coordination, and updates to off-site mitigation plans and
permits. Of the six properties required for the project, two are currently in the process of executing
agreements with the City. Three additional property owners are working with staff on the details of the
acquisition offers, and one property has not yet been formally contacted regarding an offer.
50 Page 316 of 454
4
Additionally, a Value Analysis effort completed in April identified potential opportunities to reduce project
costs, streamline construction duration, and minimize anticipated public impacts. Staff will seek feedback
from the ATC in May and return to Council on August 4th for consideration and direction on the findings
of the Value Analysis. The Council report will outline each item under consideration, including the
associated advantages and disadvantages, the estimated increase in design cost and decrease in
construction costs achieved to implement the alternative, and potential schedule impacts.
CIP Budget Alignment for FY 2026-27
Funding Needs
Leading up to the Budget Supplement, City staff reviewed project progress, delivery schedules, and current
design fee and construction cost estimates for all active projects. This section outlines the recommended
budget adjustments necessary to align the FY 2026-27 budget with available staffing resources and
anticipated delivery timelines for the coming fiscal year. The overall intent is to maintain momentum on
active projects by realigning budgetary resources with project delivery expectations and funding needs for
FY 2026-27. The tables below identify projects advancing through design and/or nearing construction and
the additional funding required to move each project forward should Council wish to complete the projects
within the current financial plan.
Recommended supplemental appropriations generally fall into four categories:
• Projects advancing from planning into final design or construction, where updated cost estimates
are now available;
• Critical infrastructure replacements needed sooner than originally anticipated due to asset
condition or operational risk;
• Grant- or reimbursement-supported projects requiring matching appropriations; and
• Strategic reallocations intended to align budget authority with realistic project delivery schedules.
New Appropriations / De-appropriations By Fund
51 Page 317 of 454
5
New Capital Appropriations
Water Fund
Water Distribution Fleet Replacements: $305,874
The proposed fleet adjustments for Project 2000521-Fleet Replacements are proposed to reallocate
existing resources to better align with operational priorities. These changes result in no net increase in
total vehicles, while introducing one new Emergency Response Trailer to enhance field response
capabilities. The revised configuration increases the FY 2026–27 budget by $305,874, which is substantially
offset by planned reductions in future fiscal years, resulting in a net cumulative impact of approximately
$81,000.
These adjustments prioritize higher-value, mission-critical equipment while deferring or removing lower-
priority replacements. Collectively, this refined fleet composition better supports core Water Distribution
operations, including fire hydrant flushing, valve turning, and emergency activities, while also improving
crew visibility and safety and reducing traffic disruption during field operations.
Proposed Fleet Changes:
52 Page 318 of 454
6
• Valve Turning Truck (Water Distribution): +$155,874 (FY 2026–27)
• Emergency Response Trailer (Water Distribution): +$50,000 (FY 2026–27)
• Vactor Truck (Water Distribution): +$650,000 (FY 2026–27)
• Dump Truck – Water Fund Purchase from Sewer Fund: +$50,000 (FY 2026–27)
• Service Body Truck (Unit 0846): –$600,000 (FY 2026–27; removed) (Water fund De-appropriation)
• Standby Truck (Unit 1629): –$75,000 (Forecasted FY 2027–28; removed)
• Service Body Truck (Unit 0847): –$150,000 (Forecasted FY 2027–28; reduced)
Overall, the proposal reflects a strategic reallocation of fleet resources—maintaining fleet size while
improving functionality, safety, and alignment with operational needs.
Tank Safety Retrofits: $270,000
The proposed adjustments for Project 2000034-Water Storage Tank Maintenance support the continued
reliability, safety, and regulatory compliance of the City’s potable water storage system. Water storage
tanks are critical infrastructure that ensure adequate system pressure, emergency reserves, and
operational flexibility. Many of these assets have been in service for decades, and ongoing maintenance
is necessary to extend their useful life and maintain compliance with State and Federal standards. The
proposed work builds on prior condition assessments and prioritization efforts to address corrosion, aging
components, and safety risks across multiple facilities.
In addition to previously identified maintenance needs (e.g., coatings, structural repairs, and component
replacements at Wash Water Tank No. 1, Reservoir 2, and Edna Tank), the current proposal includes
targeted safety upgrades to bring older facilities into compliance with modern workplace safety
standards. These improvements reduce operational risk and support safe access for inspection and
maintenance activities. These proposed changes are necessary safety improvements, and:
• Include upgrades to ladders, platforms, and fall protection systems to meet current Cal/OSHA
requirements; and
• Improves worker safety, reduces liability, and ensures compliance with applicable safety
regulations.
Overall, the proposed investment reflects a proactive approach to maintaining critical water
infrastructure—extending asset life, reducing the likelihood of costly failures, and ensuring safe and
compliant operations.
Arc Flash Survey: $165,000
The proposed adjustments for Project 2000542—Water Treatment Plant (WTP) Major Facility
Maintenance support the continued reliability, safety, and regulatory compliance of critical treatment
infrastructure. The WTP relies on a wide range of mechanical, electrical, and treatment systems to
consistently deliver potable water that meets State and Federal standards. Ongoing maintenance and
condition-based improvements are necessary to extend asset life, reduce the risk of unplanned failures,
and ensure uninterrupted operations. This project includes a variety of maintenance activities such as
repairs to pipelines and treatment units, electrical system upgrades, and condition assessments to inform
long-term asset management planning.
53 Page 319 of 454
7
A key component of the proposed work is the completion of an arc-flash electrical study of the WTP and
associated water distribution infrastructure, which is essential for maintaining a safe working
environment and meeting regulatory requirements. Electrical systems at the WTP and across the Water
Distribution system involve high-voltage equipment that can pose significant hazards if not properly
maintained. Overall, these proposed changes:
• Evaluate electrical systems to identify and quantify arc-flash hazards;
• Support compliance with NFPA 70E and OSHA (29 CFR §1910.269) requirements;
• Establish appropriate safety labeling, Personal Protection Equipment (PPE) requirements, and
safe working distances; and
• Reduce the risk of serious injury to staff and contractors and improve overall electrical safety
protocols.
Overall, this investment reflects a proactive and compliance-driven approach to facility maintenance—
prioritizing worker safety, reducing operational risk, and ensuring the continued ability to reliably and
safely deliver treated water to the community, and maintain compliance with regulatory requirements.
Sewer Fund
Wastewater Collection System Infrastructure Renewal Strategy: $66,209
The proposed adjustment for Project 2001023—Infrastructure Renewal Strategy supports the completion
of a critical planning tool for the City’s wastewater collection system. This project develops and refines a
system-wide hydraulic model used to evaluate pipe capacity under existing and future flow conditions.
The model integrates data from new development, flow monitoring, and system performance to identify
constraints, prioritize capital improvements, and inform long-term infrastructure planning. This work is
particularly important for accommodating future growth, including infill development, hospital
expansion, and university-related projects, while maintaining system reliability and regulatory
compliance.
Staff have identified opportunities to enhance the model’s accuracy and reliability through additional
analysis and real-world calibration. These refinements strengthen the technical foundation for capital
planning, policy decisions, and development review. Overall, these proposed changes:
• Fund additional modeling, system recalibration using observed flow data, and refined capacity
analysis;
• Improve accuracy of projections for existing conditions and future demand scenarios; and
• Support more informed decision-making for capital investments, development review, and
system planning.
Overall, this adjustment reflects a targeted investment to ensure the City’s wastewater modeling tool is
technically robust and decision-ready, reducing long-term planning risk and supporting efficient, data-
driven infrastructure investment.
Water Resource Recovery Facility (WRRF) Security Fencing: $87,000
The proposed adjustment for Project 2000077—WRRF Asset Replacement supports the continued
functionality, safety, and longevity of critical support facilities at the WRRF. While the wastewater
treatment plant itself has undergone multiple upgrades, key ancillary assets —including the laboratory,
54 Page 320 of 454
8
operations, and administration facilities—have not been significantly modernized since their original
construction. This project provides targeted investments to maintain and extend the useful life of these
assets, including laboratory processing ventilation, security lighting, and building security.
A key component of this effort is the replacement of deteriorated perimeter fencing to address ongoing
security concerns and protect critical infrastructure. These proposed changes:
• Replace deteriorated fencing along the east side of the WRRF, which has experienced repeated
unlawful break-ins;
• Install welded wire fencing consistent with improvements on the north and planned south sides
of the facility;
• Enhance resistance to climbing and cutting, improving site security and reducing unauthorized
access; and
• Supports a uniform perimeter standard while reducing ongoing maintenance and incident
response costs.
This investment reflects a practical and preventative approach to facility maintenance—improving
security, protecting public infrastructure and staff, and reducing long-term operational risk.
Zone 9
Silt Removal: $80,000
San Luis Obispo Creek, between Santa Rosa and Marsh Street bridges, has experienced bank erosion over
the course of many wet seasons. This erosion has been observed adjacent to the Santa Rosa Street bridge
abutments as well as nearby retaining walls that protect private property, including the dialysis clinic.
Additionally, previous generations of creek bank armoring have failed and are now constricting the creek
in this area, reducing storm flow capacity.
This new project, funded through the County Zone 9 Advisory Committee, proposes to armor the creek
banks and protect the nearby bridges and properties from scour while increasing channel capacity and
establishing a healthy creek corridor supportive of riparian species. This funding augments the City’s
existing Silt Removal project budget, which is utilized for removing silt accumulations within San Luis
Obispo Creek and its tributaries, and is important work to ensure creek capacity is maintained.
Mid-Higuera Bypass: $75,000
Construction of the Mid-Higuera Bypass project was completed in March 2026. Plant-establishment and
maintenance work is a required component of the project’s environmental permits, and the City has an
active 3-year plant establishment contract in place to ensure compliance. Due to the duration of the
maintenance work, the County Zone 9 Advisory body approved a request for an additional $75,000 to
provide contingency funds that may be necessary to address potential scope changes resulting from
pending amendments to the City’s Lake and Streambed Alteration Agreement with the California
Department of Fish and Wildlife for the project. These amendments may affect tree mitigation ratios
including increased tree mitigation plantings, associated irrigation and maintenance, and ongoing erosion
control needs that may arise over the next few years.
New Initiative: Waterway Management Plan Update: $130,000
55 Page 321 of 454
9
The requested funding supports environmental permitting and updated creek and bridge survey data
necessary to advance vegetation management planning and future hydraulic modeling efforts in both City
and County jurisdictions.
The City of San Luis Obispo, in support of the approved Reimbursement Agreement for work in County
areas, received $30,000 in County Zone 9 funds to contract with an environmental consultant for
permitting services in County jurisdictional areas for vegetation management. This effort will dovetail with
existing City led efforts for vegetation management and permitting within City limits and support a larger
vegetation management effort in priority areas. The East Fork of San Luis Obispo Creek, in the San Luis
Obispo County jurisdictional area, is the focus for this initial effort and is not currently addressed in the
WMP.
Additionally, the City of San Luis Obispo is looking to have updated survey information on the bridges
spanning San Luis Obispo and Stenner Creeks into and through City limits. This effort will provide new
baseline information supporting the new hydraulic model currently under development and being scoped
out by County staff. The City received $100,000 in County Zone 9 funds for this effort, which will
complement the survey information completed for the Mid-Higuera Bypass.
No local funds are proposed for appropriation for this work and this project is entirely funded by County
Zone 9 funds in an effort to support ongoing creek watershed enhancements and maintenance.
Transit Fund (State and Federal Grant)
Downtown Transit Center Rehabilitation
The existing Downtown Transit Center was constructed in 2002 and lacks the capacity to serve the existing
and proposed bus routes that service this stop. This project will add an additional two bus bays, either
along Osos Street, Palm Street, Mill Street or some combination thereof. The site will also receive
additional security cameras, wayfinding signage and ADA improvements. Design is underway, and
additional funding is requested based on updated and better-defined design cost estimates that reflect
the complexity of the project.
Transportation Impact Fees
See “Transportation Impact Fee Reconciliation” subsection and summary on California/Taft funding for
specific information on appropriations from the Transportation Impact Fee.
56 Page 322 of 454
10
Supplemental Reallocations By Fund:
Project Budget Reallocations
CIP reallocations refer to adjustments of planned funding identified in year two of the 2025-27 Financial
Plan to align resources with current project schedules, scopes, and delivery needs. These changes do not
reduce previously appropriated funding.
Capital Outlay Funds (Including LRM)
Police Building 1042 - Tenant Improvements, HVAC and Hydronic System
The reallocation of $2,415,000 from Year 2 of the financial plan for the 1042 Walnut project is intended
to better align budget with the anticipated project delivery schedule. This adjustment does not change
the timeline of the project or reprioritize its delivery in any way. Staff are actively working on and
prioritizing the Police Department Tenant Improvement project within the Capital Improvement Program,
and have recently completed selection of the design consultant that will lead development of the project
plans, specifications, and estimates, including a design kickoff meeting with Public Works and Police
Department Staff. Given the age and complexity of the existing facility, staff are taking a deliberate design
approach to ensure full alignment between the Architect, Public Works, and the Police Department prior
57 Page 323 of 454
11
to bidding. This approach is intended to reduce risk and avoid costly changes during construction that
could otherwise extend the construction timeline and lengthen the period of Police staff displacement.
This budget adjustment does not eliminate all project funding, rather it reduces Year 2 programmed
funding from $4.31 million to $1.895 million, reflecting updated cash flow assumptions based on the
current project delivery schedule. The remaining Year 2 funding is sufficient to support continued design
and early project development activities.
The proposed reallocation of $2.415 million will be reprogrammed into Year 3 of the CIP, consistent with
the 10-year CIP framework, and will be further refined through the 2027–2029 Financial Plan update as
design advances and more detailed cost estimates are developed.
2090742-01 - Drainage Infrastructure Replacement: $485,000
Staff are currently advancing the design of several projects to address failed and aging storm drain
infrastructure. These efforts include replacement of a storm drain crossing at Olive Street, as well as
improvements at the intersections of Skyline Boulevard and Clover Street, and Rafael and Luneta Streets.
Collectively, these projects are critical to maintaining system reliability and reducing the risk of localized
flooding and infrastructure failure.
In addition to these standalone projects, storm drain infrastructure is routinely evaluated and replaced as
part of larger paving and roadway improvement efforts. To ensure continued progress on both dedicated
drainage projects and opportunistic replacements coordinated with other capital improvements, staff
requests additional funding to support design and construction activities. The recommended funding
allocation will provides sufficient budget to continue with construction on planned current storm drain
replacement projects.
2000054-01 - Righetti Community Park - Play Structure and Fields
The Righetti Community park started construction after the Groundbreaking Ceremony in March of this
year, with excavation and utility connections currently underway. As part of ongoing coordination with
the contractor and City team, staff evaluated the implications of constructing a future pedestrian bridge
during later phases of the project.
The bridge is required to support planned future amenities, including additional park improvements on
the opposite side of the creek including basketball courts and tennis courts. While the full bridge is not
included in the current phase, its abutments are located in close proximity to the planned play structure
area. Constructing these elements at a later date would likely result in temporary park closures,
disruption, and removal and replacement of adjacent hardscape and other impacted improvements.
Earlier this year, Council appropriated additional funding to support expanded project elements, including
the pickleball courts and bike pump track. The pump track component already includes a pedestrian
bridge, which will be constructed as part of the current phase.
To minimize future impacts and improve overall project efficiency, this adjustment allocates funding to
construct the abutments for the future pedestrian bridge as part of the current work. Advancing this
portion of the project now allows for more efficient use of available funds, helps mitigate the effects of
construction cost escalation, and avoids potential disruption to park amenities once they are in use.
58 Page 324 of 454
12
Constructing the abutments during the current phase avoids future demolition of newly completed park
improvements and significantly reduces long-term construction costs and operational disruption.
2000069-00 - Pedestrian Crossing Improvements: $250,000
The City has experienced ongoing reliability and maintenance issues with the existing in-road flashing
pedestrian crosswalk systems in the downtown area. There are currently three installations: one crossing
on Marsh Street near the Downtown Centre, and two crossings on Higuera Street—one between Morro
and Chorro Streets and another at Garden Street. The existing systems frequently malfunction and require
regular troubleshooting and parts replacement by City maintenance staff. In 2025, the in-road flasher
system at Higuera Street and Garden Street failed completely, requiring the installation of a temporary
solar-powered replacement as an emergency repair.
The purpose of this project is to fund replacement of these existing unreliable in-road flashing crosswalk
systems with new systems (Rectangular Rapid Flashing Beacons) that are more reliable, require less
maintenance, and are generally more effective at increasing visibility of pedestrians crossing these streets.
In addition to replacing these three existing flashing crosswalk systems, this project scope also includes
the proposed installation of pedestrian signal at the three downtown intersections that currently lack any
pedestrian equipment (Higuera/Morro, Marsh/Morro, Chorro/Palm)—these improvements align with
strategies identified in the City’s Active Transportation Plan, Vision Zero Action Plan, and support current
Major City Goals for Infrastructure and Sustainable Transportation. Design for this project is substantially
complete—this reallocation of funds to this project would support construction of these pedestrian
crossing improvements.
2000033-01 - Devaul Ranch Playground: $100,000
Devaul Park’s playground equipment has exceeded its useful life and requires replacement. This project
will remove and replace the existing playground and upgrade the surrounding concrete pathways to
ensure compliance with ADA accessibility standards.
Staff has advanced the design of the playground replacement; however, updated cost estimates indicate
a funding shortfall. To proceed with construction and deliver the project as planned, staff is requesting
additional funding.
2000508-00 - City Hall Drought Tolerant Landscaping and Restroom: $75,000
This project funds the installation of drought-tolerant landscaping at City Hall and the installation of a
prefabricated restroom at the Transit Center. The conversion to drought tolerant landscape will allow the
City to remain in compliance with State regulations related to Non-Functional Turf. The restroom
component is being advanced as a standalone project, separate from the Downtown Transit Center
project, to expedite delivery and address an immediate facility need.
Design is currently underway, and preliminary cost estimates indicate that additional funding is required.
Specifically, increased costs are associated with additional concrete work needed to meet ADA
accessibility requirements for the restroom facility, including compliant paths of travel and site grading
adjustments. This additional funding is requested to ensure the project is fully funded for construction
and can proceed without delay.
2000075-19.01 - Dispatch HVAC Replacement: $60,000
59 Page 325 of 454
13
The HVAC units for the Emergency Communications Center are original and coming to the end of their
useful life. These units serve the dispatcher area and are operational 24/7. Funding was included in the
2027-28 fiscal year to replace the units; however, the units have had increased mechanical failures and
are at risk for a catastrophic failure prior to the original project date. Advancing the funding by one year
to replace the HVAC units will help ensure the Emergency Communications Center heating and cooling
remains functional. The new units will also be fully electric and will replace gas-fired heating equipment.
2000601-13.1 - Public Safety POD Cameras Skate and Sinsheimer Park: $30,000
This project provides funding for the replacement of outdated and non-operational security cameras at
the Santa Rosa Skate Park and Sinsheimer Park. The existing cameras at both locations are legacy POD-
style units that have reached the end of their useful life. They are currently unreliable and produce
significantly degraded image quality, limiting their effectiveness for security and incident documentation
purposes.
Both camera systems were originally installed as part of prior park improvement projects and have not
been upgraded since that time. Due to ongoing performance issues and obsolescence, full replacement is
necessary to restore reliable surveillance coverage. The proposed improvement includes installation of a
single modern 4-way camera at each location. These systems provide substantially improved image
quality and expanded coverage compared to the existing equipment.
2000078-00 – Ludwick Community Center Roof, Solar, Siding, and HVAC: $300,000
The Ludwick Community Center is an existing CIP project, with $2.5 million currently planned in FY 2027-
28 for construction. The project seeks to address several major building components that have exceeded
their useful life, including the HVAC system, roofing system and associated rooftop solar, and exterior
siding. These aging systems have led to increased operations and maintenance costs, reduced reliability,
and a growing risk of service disruptions.
This work was originally anticipated to be completed as a series of maintenance projects led by Facilities
staff; however, due to the complexity and interrelated nature of the building systems, it has become clear
that a comprehensive, professionally designed approach is necessary. Furthermore, while the project is
currently planned for construction in FY 2027-28, no funding was previously identified to support the
design phase. Staff is requesting funding to initiate design and engage a multidisciplinary team of
architects and engineers. Advancing design is critical to maintaining the overall project schedule and
ensuring timely delivery of construction.
2000520-04.01 - Fleet Services (Corp Yard) Stationary Generator: $300,000
The City’s Corporation Yard serves as the Department Operations Center (DOC) in emergency events and
requires a backup generator to ensure consistent power delivery during electrical grid outages. In addition
to DOC operations, the site also houses the City’s fleet fuel tanks and pumps, which supplies fuel to most
City assets, including the Police Department. The generator requires replacement due to its age, and staff
is nearing completion of the design phase. Continuing into construction phase within FY 2026-27 will
ensure the Corp Yard has a functional backup generator if any emergencies arise.
Final cost estimates indicate additional funding is needed to construct this project, primarily due to newer
floodproofing and seismic requirements.
60 Page 326 of 454
14
2000555-01 - City Hall Generator (GEN-9712): $25,000
City Hall possesses a small natural gas generator that is used to operate the City’s IT systems during power
outages. This generator has reached the end of its useful life and is ready for replacement.
To meet ventilation requirements dictated by the current Building Code, part of the generator enclosure
must be modified with louver doors and wider maintenance entrances. The project design is nearing
completion and current cost estimates indicate that additional funding is necessary to fully fund
construction with the added code compliant features. The proposed funding allocation is expected to fully
fund the construction cost.
2000513-02 - Corporation Yard EV Charging Station: $240,000
The Corporation Yard EV Charger Project will install new electric vehicle charging infrastructure to support
fleet electrification and reduce operational emissions. The project is currently funded through a
combination of Local Revenue Measure (LRM) funds, the Sewer Fund, the Water Fund, previously
allocated carryover funds, and external incentives including the 3CE rebate, the PG&E EV Fleet Rebate,
and grant contributions from the Air Pollution Control District (APCD). While these sources substantially
offset project costs, the current construction cost estimate exceeds available funding, and additional
supplemental funding is requested to fully fund construction and maintain the planned delivery within
the FY 2026-27 Fiscal Year.
2001002-01 - Sidewalk Replacement and Cleaning: $100,000
There is currently $250,000 programmed in FY 2026/27 for Sidewalk Replacements and Cleaning, which
supports sidewalk accessibility improvement and ongoing maintenance. This additional funding will cover
the cost of replacing sections of sidewalks damaged by City street trees at five separate locations,
including an area directly adjacent to the crosswalk on Marsh Street by the Post Office. In addition to the
sidewalk repairs, the funding will be used to replace an ADA curb ramp and increase the frequency of
pressure washing downtown sidewalks during the summer months, when the Ficus trees are at peak
berry-dropping, thereby helping to keep downtown safe and beautiful.
City - County Library Major Maintenance (91559): $150,000
In October 1989, a Joint Powers Agreement (JPA) was executed between the City and County of San Luis
Obispo, which established the framework for joint operation of the San Luis Obispo City/County Library.
The JPA defines “major maintenance” as a one-time repair with a cost exceeding $44,000 and provides
that such costs are to be shared equally between the City and County.
The Facilities Planning Division of the County Public Works Department completed a capital project in FY
2024–25 that meets this definition. The project included a remodel of the first-floor public restrooms to
extend the useful life of the facility and achieve compliance with the Americans with Disabilities Act. The
County’s final project cost was approximately $300,000, resulting in a City cost-share obligation of
$150,000 in accordance with the JPA.
The County completed the work on behalf of the joint facility consistent with the terms of the JPA, and
the City’s contribution is now required to satisfy the cost-sharing obligation. Funding is requested at this
time to expedite reimbursement to the County for work that has already been completed.
61 Page 327 of 454
15
Completed Projects Transfers By Fund:
2000029 - Bridge Maintenance: $69,286
This annual asset maintenance project provides funding for ongoing bridge maintenance projects. This
specific budget transfer request will be utilized for replacement of damaged bridge railings at two
locations: along the Railroad Safety Trail (RRST) near Sinsheimer Park, where a bridge railing was
compromised due to fire damage, and at the Broad Street on-ramp to southbound US 101, where the
railing was damaged by a vehicle collision. At both sites, the existing railings have sustained structural
damage and no longer provide the intended level of safety for users. Timely replacement is necessary to
restore safe conditions and maintain the functionality of these important transportation facilities. Work
will include removal and disposal of the existing damaged railings, installation of new code-compliant
bridge railing systems, and any necessary minor concrete repair or surface restoration associated with the
replacements.
2000031 Parking Lot Maintenance (Parking Fund): $109,000
Funding transferred to this project will provide for maintenance of City-owned parking lots, specifically
revenue generating Parking Fund lots 1. Many of these facilities are experiencing typical wear and tear
such as cracking, surface deterioration, and faded or missing striping, which reduces functionality and
overall safety. Deteriorated pavement can accelerate if not addressed in a timely manner, leading to more
costly rehabilitation or full reconstruction. Faded striping diminishes visibility of parking stalls, accessible
1 https://www.slocity.org/government/department-directory/public-works/parking-services/parking-
guide/parking-lots
62 Page 328 of 454
16
spaces, and circulation patterns, creating confusion for users and potential compliance issues. This budget
will provide the ability to perform crack sealing, localized asphalt repairs, seal coating as appropriate, and
re-striping on an as-needed basis. Investing in routine maintenance helps preserve these revenue-
generating assets, improves user experience, and reduces long-term costs by preventing more significant
deterioration.
Infrastructure Investment Fund and Capital Reserve Status
The Infrastructure Investment Fund (IIF) was established with the primary goal of enabling the City to
harness the advantages of well-planned growth, a process that often requires timely financial support for
essential infrastructure. The fund's purpose extends to leveraging additional grant funding, providing
loans, or directly participating in critical infrastructure projects that enhance quality of life and spur
economic development. During FY 2025/27, $2 million in funding from the IIF was necessary to support
the increase in estimated construction cost of the Higuera Complete Streets Project. Consistent with
Council direction provided on February 7, 2026, the IIF was backfilled with Unassigned Fund Balance.
Furthermore, the Capital Reserve will backfill the IIF again on July 1st, and the FY 2026-27 budget
appropriates $3.5 million in reserve to the Prado Bridge Widening Project. CIP Reserve balance will be
$3,212,229 on July 1, 2026, reflecting the transfer of $787,771 to the IIF from the annual $4 million CIP
Reserve appropriation.
Infrastructure Investment Fund Summary
63 Page 329 of 454
17
Year 2 Budget Appropriations Table*
*Does not include transfers from completed projects, only reallocations and new appropriations
ID Project FY 2026-27
Total Budget
1 CIP No. # - Infrastructure Investment Fund $787,771
Infrastructure Investment Fund
Local Revenue Measure (Infrastructure Invest CIP 405) $787,771
2 CIP No. #2000027 - Urban Forest Maintenance $400,000
2000027-00 - Urban Forest Maintenance
Local Revenue Measure (Capital Outlay 401) $400,000
3 CIP No. #2000030 - Laguna Lake Golf Course Maintenance $10,000
2000030-01 - Laguna Lake Golf Course Maintenance
Local Revenue Measure (Capital Outlay 401) $10,000
4 CIP No. #2000033 - Playground Equipment Replacement $100,000
2000033-01 - Devaul Ranch Playground
Local Revenue Measure (Capital Outlay 401) $100,000
5 CIP No. #2000034 - Tank Safety Retrofits $270,000
2000034-04 - Tank Safety Retrofits
Water Fund (601) $270,000
6 CIP No. #2000053 - Bus Wash Replacement $75,000
2000053-00 - Bus Wash Replacement
Transit Fund (621) $75,000
7 CIP No. #2000054 - Righetti Community Park $300,000
2000054-01 - Righetti Community Park - Play Structure and Fields
Local Revenue Measure (Capital Outlay 401) $300,000
8 CIP No. #2000062 - Water Meters and Boxes $1,916,000
2000062-01 - Water Meter and Box (sewer fund contribution)
Sewer Fund (602) $958,000
2000062-02 - Water Meter and Box (water fund contribution)
Water Fund (601) $492,000
2000062-03 - Water Meters and Boxes - AMI Radio
Water Fund (601) $466,000
9 CIP No. #2000063 - Water Distribution Fire Hydrants $55,000
2000063-00 - Water Distribution Fire Hydrants
Water Fund (601) $55,000
10 CIP No. #2000066 - Big Belly Replacements $85,000
2000066-03 - Recycling-Solid Waste Big Belly in Downtown
(15 locations per year)
Local Revenue Measure (Capital Outlay 401) $85,000
11 CIP No. #2000069 - Pedestrian Crossing Improvements $250,000
2000069-00 - Pedestrian Crossing Improvements
64 Page 330 of 454
18
ID Project FY 2026-27
Total Budget
Local Revenue Measure (Capital Outlay 401) $250,000
12 CIP No. #2000073 - Vision Zero Program Implementation $250,000
2000073-00 - Vision Zero Program Implementation
Local Revenue Measure (Capital Outlay 401) $250,000
13 CIP No. #2000075 - Major Facility Maintenance $460,000
2000075-01.02 - IT Room Heat Pump Replacements (Annual Asset
Maintenance)
Local Revenue Measure (Capital Outlay 401) $20,000
2000075-01.03 - City Hall Fire Alarm Fire Alarm Control Panel
Local Revenue Measure (Capital Outlay 401) $115,000
2000075-03.10 - Swim Center Multipurpose Room flooring
Local Revenue Measure (Capital Outlay 401) $25,000
2000075-08.03 - Police Department Emergency Communications Center
Workstation/Carpet Replacement
Local Revenue Measure (Capital Outlay 401) $50,000
2000075-12 - Parks and Recreation Roofing Siding and Exterior Painting
Local Revenue Measure (Capital Outlay 401) $170,000
2000075-15.01 - Facility Roll Up Door Replacements - Various Locations
Local Revenue Measure (Capital Outlay 401) $20,000
2000075-19.01 - Dispatch HVAC Replacement
Local Revenue Measure (Capital Outlay 401) $60,000
14 CIP No. #2000077 - WRRF - Asset Replacement $295,000
2000077-01 - Coating Maintenance
Sewer Fund (602) $25,000
2000077-02 - Headworks Grit Piping and Blowers
Sewer Fund (602) $250,000
2000077-08 - Cityworks Strategic Plan & Implementation
Sewer Fund (602) $20,000
15 CIP No. #2000078 - LCC Roof, Solar, Siding, and HVAC $300,000
2000078-00 - LCC Roof, Solar, Siding, and HVAC
Capital Outlay (Capital Outlay 401) $300,000
16 CIP No. #2000084 - Sewer Maintenance Cover Adjustments $30,000
2000084-00 - Sewer Maintenance Hole Cover Adjustments
Sewer Fund (602) $30,000
17
CIP No. #2000115 - Sinsheimer Park Playground Turf, Soft Surface
Replacement
$50,000
2000115-00 - Sinsheimer Park Playground Turf, Soft Surface Replacement,
and Hillside Turf (every 5 years)
Local Revenue Measure (Capital Outlay 401) $50,000
65 Page 331 of 454
19
ID Project FY 2026-27
Total Budget
18 CIP No. #2000118 - Public Safety Center $200,000
2000118-01 - Public Safety Center Initial Scoping
Local Revenue Measure (Capital Outlay 401) $200,000
19 CIP No. #2000119 - Police Building - 1042 Tenant Improvements $1,895,000
2000119-01 - Police Building - 1042 TI
Capital Outlay (Capital Outlay 401) $1,895,000
20 CIP No. #2000150 - SGMA GSP $150,000
2000150-00 - SGMA GSP
Water Fund (601) $150,000
21 CIP No. #2000157 - Banner Arms, Bench Arms Rests, Signs $25,000
2000157-00 - Banner Arms, Bench Arm Rests, Signs
Local Revenue Measure (Capital Outlay 401) $25,000
22 CIP No. #2000198 - Silt Removal $150,000
2000198-03 - Silt Removal 2026
Zone 9 (Capital Outlay 401) $150,000
23 CIP No. #2000402 - Electric Buses and Associated Infrastructure $5,507,000
2000402-00 - 2 Battery Electric Buses and Associated Infrastructure
State or Federal Grant (Transit 621) $5,507,000
24 CIP No. #2000405 - Refurbishment of SLO Transit Buses $1,000,000
2000405-00 - Refurbishment of SLO Transit Buses (Base)
State or Federal Grant (Transit 621) $1,000,000
25 CIP No. #2000406 - Senior Center Paint and Window $35,000
2000406-00 - Senior Center Paint and Window
Local Revenue Measure (Capital Outlay 401) $35,000
26 CIP No. #2000503 - Public Art Maintenance $210,000
2000503-05 - Public Art Coordination (ops)
Local Revenue Measure (Public Art Private Sector 207) $110,000
2000503-06 - Public Art Procurement
Local Revenue Measure (Public Art Private Sector 207) $100,000
27 CIP No. #2000506 - Bus Stop Improvements $90,000
2000506-00 - Bus Stop Improvements
State or Federal Grant (Transit 621) $90,000
28 CIP No. #2000508 - City Hall Drought Tolerant Landscaping and Restroom $75,000
2000508-00 - City Hall Drought Tolerant Landscaping and Restroom
Local Revenue Measure (Capital Outlay 401) $75,000
29 CIP No. #2000510 - Public Art Installations $100,000
2000510-00 - Public Art Installations
Local Revenue Measure (Public Art Private Sector 207) $100,000
66 Page 332 of 454
20
ID Project FY 2026-27
Total Budget
30 CIP No. #2000512 - Downtown Zig-Zig Lighting $20,000
2000512-00 - Downtown Zig-Zag Lighting
Local Revenue Measure (Capital Outlay 401) $20,000
31 CIP No. #2000513 - Electric Vehicle Charging Stations $670,000
2000513-02 - Corporation Yard EV Charging Station
Capital Outlay (Capital Outlay 401) $240,000
Local Revenue Measure (Capital Outlay 401) $240,000
Sewer Fund (602) $80,000
Water Fund (601) $80,000
2000513-04 - Various City Facilities EV Charging Stations
Local Revenue Measure (Capital Outlay 401) $30,000
32 CIP No. #2000519 - Fleet Replacement: Parks and Rec $68,500
2000519-07.04 - Golf Course Truck (0819) EV
Local Revenue Measure (Capital Outlay 401) $68,500
33 CIP No. #2000520 - Fleet Replacement: Public Works $997,500
2000520-01 - Streets- Sweeper (1703) (no later than a year 3 purchase)EV
Local Revenue Measure (Capital Outlay 401) $200,000
2000520-01.04 - Streets Maint Compact Pickup (0223) (GPR Truck) EV
Local Revenue Measure (Capital Outlay 401) $80,000
2000520-02.05 - Parks Maint Turf Tender (0609)
Local Revenue Measure (Capital Outlay 401) $22,000
2000520-02.06 - Parks Maint Refuse Truck F450 (1015)
Local Revenue Measure (Capital Outlay 401) $80,000
2000520-02.07 - Parks Maintenance 3/4 ton Pickup (0832)(0903) EV
Local Revenue Measure (Capital Outlay 401) $68,500
2000520-02.11 - Parks Maintenance Compact Pickup (0848) Hybrid/EV
Local Revenue Measure (Capital Outlay 401) $38,500
2000520-03.02 - Facilities Maintenance 3/4 ton Pickup with Utility Bed
(0829) EV
Local Revenue Measure (Capital Outlay 401) $75,000
2000520-04.01 - Fleet Services (Corp Yard) Stationary Generator
Capital Outlay (Capital Outlay 401) $300,000
2000520-06.03 - Engineering Compact Pickup (0905)
Local Revenue Measure (Capital Outlay 401) $65,000
2000520-07.01 - Urban Forest Pickup (0852) EV
Local Revenue Measure (Capital Outlay 401) $68,500
34 CIP No. #2000521 - Fleet Replacements: Utilities $905,874
67 Page 333 of 454
21
ID Project FY 2026-27
Total Budget
2000521-01.07 - Water Distribution Vactor Truck
Water Fund (601) $650,000
2000521-01.08 - Water Distribution Valve Turning Truck (New Task)
Water Fund (601) $155,874
2000521-01.09 - Water Distribution Dump Truck (1516)
Water Fund (601) $50,000
2000521-01.10 - Water Distribution Emergency Response Trailer (New
Task)
Water Fund (601) $50,000
35 CIP No. #2000527 - Point Repairs - Wastewater Collections System $240,000
2000527-00 - Point Repairs - Wastewater Collections System
Sewer Fund (602) $240,000
36 CIP No. #2000529 - Recycled Water Orcutt Street - Fernwood to Laurel $1,900,000
2000529-00 - Recycled Water Orcutt Street - Fernwood to Laurel
Water Fund (601) $1,900,000
37
CIP No. #2000531 - Recycled Water and Ultraviolet Disinfection
Maintenance (602)
$10,000
2000531-00 - Recycled Water and Ultraviolet Disinfection Maintenance
Water Fund (601) $10,000
38 CIP No. #2000537 - Transportation Monitoring & Modeling Update $55,000
2000537-00 - Transportation Monitoring & Modeling Update
Local Revenue Measure (Capital Outlay 401) $55,000
39 CIP No. #2000542 - WTP Major Facility Maintenance $165,000
2000542-19 - Arc Flash Survey
Water Fund (601) $165,000
40 CIP No. #2000551 - WRRF Power Cogeneration Upgrade $1,475,000
2000551-00 - WRRF - Digester Flare Upgrade
Sewer Fund (602) $1,475,000
41 CIP No. #2000553 - Fleet Replacement: Police $437,000
2000553-01.01 - Patrol SUV (2 to 4 Vehicles)
Capital Outlay (Fleet Repl 402) $187,000
2000553-06 - Police Patrol Electric SUV (1 -2 Vehicles Per Year) EV
Local Revenue Measure (Capital Outlay 401) $115,000
2000553-13 - Investigations Mini Van (1614) Hybrid
Local Revenue Measure (Capital Outlay 401) $70,000
2000553-17 - Investigations SUV (1535)
Local Revenue Measure (Capital Outlay 401) $65,000
42 CIP No. #2000554 - Fleet Replacement: Fire $675,000
2000554-02 - Patrol - Type VI Fire Engine
Local Revenue Measure (Capital Outlay 401) $350,000
68 Page 334 of 454
22
ID Project FY 2026-27
Total Budget
2000554-09 - Station 5 Fire Apparatus
Local Revenue Measure (Capital Outlay 401) $300,000
2000554-10 - Cart Utility w/ Dump Bed (1802)
Capital Outlay (Fleet Repl 402) $25,000
43 CIP No. #2000555 - Fleet Replacement: Admin $25,000
2000555-01 - City Hall Generator (GEN-9712)
Capital Outlay (Capital Outlay 401) $25,000
44 CIP No. #2000568 - Golf Course Pro Shop - Flood Damage Repair $250,000
2000568-00 - Golf Course Pro Shop Flood Damage
Local Revenue Measure (Capital Outlay 401) $250,000
45
CIP No. #2000571 - Sewer-main Replacements: San Jose, Ramona, Monte
Vista, and California
$310,000
2000571-00 - San Jose, Ramona, Monte Vista, and California Pipeline
Replacement
Sewer Fund (602) $310,000
46 CIP No. #2000574 - Parking Pay Station Installation $500,000
2000574-00 - Parking Pay Station Installation
Parking Fund (611) $500,000
47 CIP No. #2000601 - Public Safety IT Replacements $427,867
2000601-02 - Audio Recording System Replacement
Capital Outlay (Info Tech Repl 403) $173,891
2000601-10 - PD Data Storage
Capital Outlay (Info Tech Repl 403) $57,066
Local Revenue Measure (Capital Outlay 401) $106,133
2000601-13 - Public Safety POD Cameras
Capital Outlay (Info Tech Repl 403) $60,777
2000601-13.1 - Public Safety POD Cameras Skate and Sinsheimer Park
Local Revenue Measure (Info Tech Repl 403) $30,000
48 CIP No. #2000604 - Network IT Replacements $223,414
2000604-01 - City SAN
Capital Outlay (Info Tech Repl 403) $200,494
Parking Fund (611) $2,292
Sewer Fund (602) $9,168
Transit Fund (621) $2,292
Water Fund (601) $9,168
49 CIP No. #2000608 - Active Transportation Plan Implementation $200,000
2000608-01 - Bicycle Facility Improvements
Local Revenue Measure (Capital Outlay 401) $100,000
2000608-02 - Pedestrian Facility Improvements
69 Page 335 of 454
23
ID Project FY 2026-27
Total Budget
State or Federal Grant (Capital Outlay 401) $100,000
50 CIP No. #2000611 - Fleet Replacement: Parking $50,000
2000611-01 - Mobility Services Pool Car (EV)
Transit Fund (621) $25,000
2000611-02 - Mobility Services Pool Car (EV)
Parking Fund (611) $25,000
51 CIP No. #2000617 - 2026 Paving Project $4,302,858
2000617-00 - 2026 Paving Project
211 - SB1 Road Repair $1,302,858
Local Revenue Measure (Capital Outlay 401) $3,000,000
52 CIP No. #2001002 - Sidewalk Maintenance $350,000
2001002-01 - Sidewalk Replacement and Cleaning
Capital Outlay (Capital Outlay 401) $100,000
Local Revenue Measure (Capital Outlay 401) $250,000
53 CIP No. #2001003 - Traffic Maintenance and Replacement $430,000
2001003-01- Traffic Signs & Striping Maintenance
Local Revenue Measure (Capital Outlay 401) $130,000
2001003-02 - Traffic Signal Asset Maintenance and Replacements (ADA)
Local Revenue Measure (Capital Outlay 401) $200,000
2001003-03- No Parking Sign Installations
Local Revenue Measure (Capital Outlay 401) $100,000
54 CIP No. #2001004 - Water Distribution Utility Trench Repair $340,000
2001004-00 - Trench Repairs- Water
Water Fund (601) $340,000
55 CIP No. #2001005 - Water Valve Cover Adjustments $35,000
2001005-00 - Water Valve Cover Adjustments
Water Fund (601) $35,000
56 CIP No. #2001009 - Whale Rock Reservoir – Asset Replacement $20,000
2001009-02 - Reservoir Fencing
Whale Rock Fund (705) $20,000
57 CIP No. #2001010 - Parks Major Maintenance $575,000
2001010-07.02 - Mission Plaza Railing Upgrade
Local Revenue Measure (Capital Outlay 401) $35,000
2001010-10.02 - Parks Play Surfacing
Local Revenue Measure (Capital Outlay 401) $285,000
2001010-10.05 - Concrete Bench & Table Replacement Various Locations
Local Revenue Measure (Capital Outlay 401) $15,000
2001010-13.02 - Irrigation Mainline Leak Repair
Local Revenue Measure (Capital Outlay 401) $50,000
2001010-13.03 - Landscape Controller System Upgrade to Calsense
70 Page 336 of 454
24
ID Project FY 2026-27
Total Budget
Local Revenue Measure (Capital Outlay 401) $150,000
2001010-19 - Islay Park Flatwork Replacement
Local Revenue Measure (Capital Outlay 401) $40,000
58 CIP No. #2001011 - Open Space Maintenance $125,000
2001011-01 - General Open Space Maintenance
Local Revenue Measure (Capital Outlay 401) $75,000
2001011-02 - Open Space Fencing
Local Revenue Measure (Capital Outlay 401) $50,000
59 CIP No. #2001015 - Neighborhood Traffic Improvements $35,000
2001015-00 - Neighborhood Traffic Improvements
Local Revenue Measure (Capital Outlay 401) $35,000
60 CIP No. #2001016 - Street Lights $80,000
2001016-00 - Streetlights
Local Revenue Measure (Capital Outlay 401) $80,000
61
CIP No. #2001017 - Whale Rock Reservoir Transmission Pipeline
Replacement
$960,000
2001017-00 - Transmission Pipeline Repairs
Whale Rock Fund (705) $960,000
62 CIP No. #2001023 - Infrastructure Renewal Strategy $66,209
2001023 - Infrastructure Renewal Strategy
Sewer Fund (602) $66,209
63 CIP No. #2001024 - Sewer Inflow and Infiltration Reduction $420,000
2001024-00 - Sewer Inflow and Infiltration Reduction
Sewer Fund (602) $420,000
64 CIP No. #2001025 - Sewer Utility Trench Repair $25,000
2001025-00 - Sewer Utility Trench Repair
Sewer Fund (602) $25,000
65 CIP No. #2001026 - WTP Major Maintenance $180,000
2001026-02 - Air Compressor and Dryer Maintenance
Water Fund (601) $7,000
2001026-03 - Chemical System Maintenance
Water Fund (601) $33,000
2001026-04 - Ozone System Maintenance
Water Fund (601) $140,000
66 CIP No. #2001032 - Pismo Street Retaining Wall (Storm Recovery) $1,900,000
2001032-01 - Pismo Street Retaining Wall Adjacent to Vista Grande
Local Revenue Measure (Capital Outlay 401) $1,900,000
67 CIP No. #2001033 - Downtown Transit Center Rehabilitation $150,000
71 Page 337 of 454
25
ID Project FY 2026-27
Total Budget
2001033-00 - Downtown Transit Center Rehabilitation
State or Federal Grant (Transit 621) $150,000
68 CIP No. #2001042 - Sewer-main Replacement: Chorro - Boysen to Rougeot $2,750,000
2001042-01 - Chorro - Boysen to Rougeot Sewer Pipeline Replacement
Sewer Fund (602) $2,750,000
69 CIP No. #2001043 - Recycled Water Pump Station Maintenance $45,000
2001043-03 - RW Effluent Meter Replacement
Water Fund (601) $45,000
70 CIP No. #2001052 - Water Storage Tank Inspection and Cleaning $10,000
2001052-03 - Storage Tanks
Water Fund (601) $10,000
71 CIP No. #2001053 - Waterline Abandonment & Connections $50,000
2001053-00 - Waterline Abandonment & Connections
Water Fund (601) $50,000
72 CIP No. #2001055 - WRRF - Building Maintenance $87,000
2001055-03 Security Fencing
Sewer Fund (602) $87,000
73 CIP No. #2001057 - ATP - Foothill Boulevard Complete Street Project $200,000
2001057-00 - ATP - Higuera Complete Street Project
Local Revenue Measure (Capital Outlay 401) $200,000
74 CIP No. #2001063 - Broadband Plan $6,200,000
2001063-02 - Broadband Infrastructure
State or Federal Grant (Capital Outlay 401) $6,200,000
75 CIP No. #2001067 - Ramona Crossing Improvements $200,000
2001067-00 - Ramona Crossing Improvements
Local Revenue Measure (Capital Outlay 401) $200,000
76 CIP No. #2001071 - Storm Response and Recovery $2,183,315
2001071-02 - Mitigation Planting (Storm Response and Recovery)
Local Revenue Measure (Capital Outlay 401) $1,583,315
2001071-06 - Laguna Lake Golf Course Repairs Bridge Replacement (Storm
Response and Recovery)
Local Revenue Measure (Capital Outlay 401) $600,000
77 CIP No. #2001084 - Waterway Management Plan Update $130,000
2001084-01 - Waterway Management Plan Update: Topographic Surveys
Zone 9 (Capital Outlay 401) $100,000
2001084-02 - Waterway Management Plan Update: Environmental and
Topographic Surveys
Zone 9 (Capital Outlay 401) $30,000
78 CIP No. #2090649 - Mid-Higuera Bypass $75,000
72 Page 338 of 454
26
ID Project FY 2026-27
Total Budget
2090649-00 - Mid-Higuera Bypass
Zone 9 (Capital Outlay 401) $75,000
79 CIP No. #2090742 - Storm Drains $1,235,000
2090742-01 - Drainage Infrastructure Replacement
Local Revenue Measure (Capital Outlay 401) $1,235,000
80 CIP No. #2091159 - City County Library Major Maintenance $150,000
2091159-00 City County Library Major Maintenance (91559)
Capital Outlay (Capital Outlay 401) $150,000
81 CIP No. #2091252 - Prado Road Bridge Widening $3,500,000
2091252-00 - Prado Road Bridge & Road Widening
Capital Outlay (Infrastructure Invest CIP 405) $3,500,000
82
CIP No. #2091368 - T-3 Water Storage Tank Replacement - High Pressure
Zone
$500,000
2091368-00 - Reservoir 2 Replacement
Water Fund (601) $500,000
83 CIP No. #2091503 - California & Taft Roundabout $5,514,659
2091503-00 - California & Taft Roundabout
Local Revenue Measure (Capital Outlay 401) $2,250,000
San Luis Ranch Transportation Fee (514) $1,400,000
SLR Transportation Develompent Impact Fee (514) $502,951
Transportation Impact Fee (Transportation Impact Fee 507) $1,361,708
84 CIP No. #2091633 - Corp Yard Storage Stalls $100,000
2091633-00 - Corp Yard Material Storage Stalls
Local Revenue Measure (Capital Outlay 401) $50,000
Sewer Fund (602) $25,000
Water Fund (601) $25,000
85 CIP No. #2091634 - Fire Station 1 Wash Area $150,000
2091634-00 - Fire Station 1 Vehicle Wash Area
Local Revenue Measure (Capital Outlay 401) $150,000
86 CIP No. #2091639 - Sewer Main Replacement: Chorro – Meinecke to Murray $260,000
2091639-00 - Sewer Main Replacement: Chorro – Meinecke to Murray
Sewer Fund (602) $260,000
87 CIP No. #2091734 - Water Treatment Plant - Water Meter Replacement $82,000
2091734-03 - Salinas Water Meter
Water Fund (601) $50,000
2091734-04 - Effluent Meter Replacement
Water Fund (601) $32,000
88 CIP No. #2099837 - Open Space Acquisition $150,000
2099837-00 - Open Space Acquisition
Local Revenue Measure (Capital Outlay 401) $150,000
73 Page 339 of 454
27
ID Project FY 2026-27
Total Budget
89 CIP No. #CIP Res - CIP Reserve $3,212,229
CIP Reserve
Local Revenue Measure (Capital Outlay 401) $3,212,229
Grand Total $61,454,196
74 Page 340 of 454
Major City Goals
9. Major City Goals
The tables that follow detail the specific work programs by which the City makes progress against Council
adopted Major City Goals from the 2025-27 Financial Plan. These tables also reflect changes in work
programs since adoption of the Financial Plan and provide a brief justification for each change.
75 Page 341 of 454
1 - Improve the local business environment, support Downtown vitality, and help businesses thrive
a. Finalize a Community Work Force Agreement to support future construction work for the Prado Interchange
and Public Safety Center projects. *Updated completion date to no later than FY 2027 Q4 to meet Prado Bid
deadlines.
TBD
FY 2027 Q4*
b. Implement a Business Welcome program to support business attraction, retention and expansion efforts
including start up checklists for the 17 most common business types.FY 2027 Q3
c. Create a disaster preparedness and resiliency guide for businesses and host an annual training. FY 2027 Q4
d. Work with partners to create a roadmap for the development of a potential conference facility in Downtown
SLO.FY 2027 Q4
2 - Support the cultural arts, including the Cultural Arts District
a. Complete the construction of the Mission Plaza Project to enhance the experience of the plaza and downtown.
*Updated due to construction delays.
FY 2026 Q3
FY 2026 Q4*
b. Complete the construction of the Cultural Arts District Parking Structure.Complete
c. Complete the update to the City's Historic Resources Inventory. Complete initial phase of the project updating
the Historic Preservation Ordinance and Historic Context Statement (Phase 1) and complete the update of the
Historic Resources Inventory (Phase 2).
Complete
FY 2027 Q4
d. Implement the City’s Lease and Grant Agreements with SLO REP to support construction of the new theater
and a successful opening.FY 2027 Q4
e. Manage the tenanting and ongoing operations of a vendor in the Mission Plaza kiosk.FY 2027 Q4
3 - Support initiatives to assist the local workforce to develop the skills needed to secure quality jobs
and local businesses and employers to attract and retain talent
a. Work with CAPSLO and other non profits to provide grants to support new and expanded private childcare
options and evaluate other approaches, e.g. permit streamlining, fee subsidies, if needed.FY 2027 Q4
b. Evaluate opportunities to partner with Cal Poly, SLCUSD, and County for employer-supported childcare
programs.FY 2027 Q4
c. Support the creation or expansion of coworking opportunities, such as the Hothouse, or other shared resource
facilities to lower the barriers to entry for new businesses and provide opportunities for community members to
build skills. *Completed with Council approval of the Grant agreement with Cal Poly for Center for Innovation and
Entrepreneurship renovation on 9/2/25.
Complete*
d. Analyze and annually share relevant data and insights from the business retention and expansion program
regarding labor needs with industry and workforce training partners.FY 2027 Q4
4 - Promote the City as an appealing community for people to live, work, visit, and invest
a. Implement the approved brand strategy to continue to build awareness of San Luis Obispo as a destination and
increase occupancy in hotels.FY 2027 Q4
b. Create a program to support business-led efforts to identify and promote business areas throughout the City.FY 2027 Q4
c. Conduct a study session with the City Council to explore innovative and alternative funding methods to address
the needs of business areas throughout the City. Recommend removal as this is not currently a work effort for
DSLO or any other organization.
FY 2027 Q3
Cultural Vitality, Economic Resilience, and Fiscal Sustainability
Estimated
Completion
Date
76 Page 342 of 454
5 - Balance operational needs and infrastructure investments with consideration of the long-term fiscal
a. Develop and implement a long-term strategy to address the forecasted General Fund deficit in the 2027-29
Financial Plan period. FY 2026 Q4
b. Conduct an RFP process to evaluate banking service providers that will provide secure banking services at the
best value to the City.Complete
c. Conduct an RFP process to identify a consultant to prepare the City's annual cost allocation plan to ensure that
enterprise funds are appropriately reimbursing the General Fund for services provided to them.FY 2027 Q1
d. Complete an analysis of the City’s Business License and Tax program and conduct a Study Session to evaluate
potential changes to the Municipal Code and administrative procedures to Refine the administration of the City's
business license and business tax program to enhance consistency of communications and clarity around
enforcement actions in order to maximize collection of business tax revenue.
FY 2027 Q3
e. Complete an analysis of the existing infrastructure financing program and develop a plan to implement
improvements that enhance transparency and efficiency.FY 2027 Q4
f. Complete a fiscal analysis of the golf operations at the Laguna Lake Golf Course and conduct a Council Study
Session to evaluate fiscal impacts, capital needs, and potential reuse options prior to major infrastructure
investments.
Complete
g. Develop a strategic framework that connects existing strategic plans, incorporates the City’s mission and
vision, and outlines core services to support a longer-term planning approach beyond the two-year Financial
Plan.
FY 2027 Q4
Cultural Vitality, Economic Resilience, and Fiscal Sustainability
(Continued)
77 Page 343 of 454
1 - Increase access and belonging for all community members
1a. Provide an annual update and receive feedback on City DEI efforts at the Diversity Partners Network (DPN),
which includes representatives from Cal Poly, Cuesta College, and other local organizations involved in the
diversity, equity, and inclusion space.
FY 2027 Q4
1b. Conduct an annual Community Academy or Candidate Education Forum and increase application outreach,
especially to underserved and underrepresented communities.
Complete
FY 2027 Q4
1c. Host at least two listening sessions with minority- and women-owned businesses (MWOBs) and other
interested businesses to receive input on the tools they need, and any barriers to overcome, to be successful
business owners in the community.
FY 2027 Q4
1d. Develop and distribute to the community and partners a brief annual report from the Office of DEI
highlighting outcomes and results of DEI work.
FY 2026 Q4
FY 2027 Q4
1e. Complete the portion of the Broadband Plan funded through the Last Mile Federal Funding Account.FY 2027 Q2
2 - Facilitate programs and initiatives to support diverse community engagement and representation
2a. Implement a communications plan to provide education and information about the City's new Citywide
Single Voting System.FY 2027 Q1
2b. Partner with local community partners Diversity Coalition's BIPOC Board Leadership Program to increase to
expand pathways for underserved and underrepresented community members to participate in representation
of underserved and underrepresented groups on City Advisory Bodies through a separate training/panel session
in conjunction with the existing program outreach and education.
Complete
2c. Provide annual and on-demand training of the City's Public Engagement and Noticing Manual for applicable
City employees, including updates to better reach underserved and underrepresented communities.FY 2027 Q4
2d. Develop and distribute a “how to” guide in Spanish and other languages on how to participate in public
meetings and share public comment. * Updated due to additional time needed to also create corresponding
webpage.
FY 2026 Q2
FY 2027 Q2*
2e. Incorporate a land acknowledgement into City Council meetings and advisory body meetings. *Updated due
to ongoing conversations between regional tribes.
FY 2026 Q4
FY 2027 Q2*
Diversity, Equity, and Inclusion
Estimated
Completion
Date
78 Page 344 of 454
Diversity, Equity, and Inclusion (continued)
3 - Operationalize inclusive practices in City processes and policies
3a. Create a Citywide Title VI Implementation Plan and other required documents.Complete
3b. Annually review four City policies and practices, as identified by City departments and the Office of DEI, to
ensure inclusive language and processes.FY 2027 Q4
3c. Embed equity considerations into the City financial planning and budget process such as updating the
Significant Operating Budget Change form.FY 2027 Q4
4 - Foster an inclusive organizational culture with equitable practices in recruiting, hiring, and retention
4a. Develop and implement equity and inclusivity training for staff of all levels (Directors, Managers, Staff, etc.).
*Updated to reflect the final completion date of four workshops that are being developed, with two in FY 2026
and two in FY 2027. The first workshops are anticipated to begin in FY 2027.
FY 2026 Q4
FY 2027 Q4*
4b. Develop and implement a set of DEI-focused best practices in screening and interviewing processes, such as
a blind application review. FY 2027 Q4
4c. Take the San Luis Obispo County Family-Friendly Workplace Assessment, work with interested employees to
identify needs and implement any recommendations as feasible.FY 2027 Q4
4d. Integrate DEI competencies into performance evaluations for management level positions, which can
include, but is not limited to, training, team development, and project implementation. FY 2027 Q4
4e. Annually review report out in Q3 on demographic data collected in NeoGov for City job applicants and
identify targeted strategies to guide outreach, recruitment, and retention strategies. address potential equity
gaps. The Council Compensation Committee will review data regarding advisory body members and make
recommendations to Council in FY 2026 Q4. *Updated language and timeline to reflect revised approach.
FY 2026 Q3
FY 2026 Q4*
FY 2027 Q3
79 Page 345 of 454
1 - Facilitate sustainable growth that aligns with climate, economic, and housing goals
a. Organize a focus group to explore barriers to residential infill development—including specific discussions about
the Downtown Core—and produce a memo to Council to help guide updates to the Zoning Regulations. *Updated
due to staffing constraints.
FY 2027 Q2
FY 2027 Q3*
b. Conduct a study session Provide a Council Memo on the status of the City's growth management regulations. Complete
c. Conduct a study session on implications and implementation of State Fire Hazard maps for local responsibility
areas. Complete
d. Implement actions and requirements of the State Fire Hazard Severity maps Ongoing
2 - Promote the expansion and diversification of housing opportunities for all
a. Conduct an educational forum and improve the implementation of Below Market Rate (BMR) best practices to
market and streamline the purchase and rental process for BMR units. *Updated due to staffing constraints.
FY 2027 Q1
FY 2027 Q3*
b. Create an informational handbook to assist the community in understanding state and local regulations for the
development of ADUs and the creation of Urban Lot Splits and evaluate options for adopting pre-approved ADU
plans.
Complete
c. Annually, or as needed for compliance, and by obtaining information from housing partners, complete updates to
the Zoning Regulations to implement state law and to address identified barriers to affordable housing and housing
production.
FY 2026 Q3
FY 2027 Q3
d. Work with SLOCOG to determine the City's RNHA allocation for the 7th Cycle Housing Element Update.FY 2027 Q4
e. Initiate an update to the 7th Cycle Housing Element through the creation of an RFP for consultant services, and
present RFP to the City Council with a study session on potential scoping for Land Use and Circulation Element
Update
FY 2027 Q4
3 - Ensure housing is safe, healthy, and affordable, while facilitating stronger protections for renters
a. Conduct a study session with the City Council to identify needs and opportunities regarding renter protections,
based on the memo produced in 2024, and receive direction on items for further consideration and development. Complete
b. Conduct a study session with the City Council on potential Rental Housing Registry. This study session would
discuss parameters of potential registry and discussion of resources needed for establishment and ongoing
maintenance of registry.
Complete
c. Adopt and implement updated California Building Standards and local amendments (building code)Complete
d. Create a strategic plan for the safe housing program, and conduct outreach and engagement with a focus on
both tenants and landlords.FY 2027 Q2
4 - Foster diverse, connected, and safe neighborhoods that are livable for all
a. Initiate an update to the Tree Regulations to streamline housing projects.Complete
b. Conduct a study session with Council on Code Enforcement priorities related to safe/livable neighborhoods and
receive feedback on priorities. Discuss potential updates to property maintenance standards. Complete
c. Update property maintenance standards, if necessary, to ensure they align with City priorities related to safe and
livable neighborhoods and housing. *Updated due to staffing constraints.
FY 2027 Q2
FY 2027 Q4*
d. Create a project plan and standard operating procedures for Community Development enforcement of zoning
code regulations pertaining to Greek houses. Consider potential updates to zoning code to facilitate efficient
regulation of Greek houses. *Updated to better align with study session (Task 4b).
FY 2026 Q3
FY 2027 Q1*
Housing and Neighborhood Livability – Healthy, Safe, and
Affordable Estimated
Completion
Date
80 Page 346 of 454
1 - Collaborate with partners to prevent and reduce homelessness
a. Data - Support efforts to improve data access between City, County and service providers to more effectively
facilitate connecting unhoused individuals to shelter and services. Identify data platform needs and develop
implementation plans.
FY 2027 Q4
b. Prevention - Collaborate quarterly with SLO County and housing and homeless services providers to streamline
resources to enable individuals and families to remain in housing. FY 2027 Q4
c. Homeless Services - Meet monthly with CAPSLO to support effectiveness of the 40 Prado Homeless Service
Center, including updates to Good Neighbor Policy which will be presented to Council in Q2 of FY25-26. Complete
d. Justice Services - Continue and expand collaborations between the City Attorney/City Prosecutor, SLOPD & SLO
Fire (CAT/MCU/CSOs/LPTs), County Behavioral Health, and SLO Courts to coordinate criminal warrant and
Municipal Code criminal misdemeanor prosecution efforts to enhance criminal diversion, social services, and
specialty court connections, including mental health, drug and alcohol, veteran's support, CARE Court,
conservatorship and housing and benefits services.
FY 2027 Q4 (&
Ongoing)
e. Regional Compact - Work with SLO County jurisdictions to develop and execute regional MOU to clearly outline
jurisdictional responsibilities to prevent and address homelessness, create accountability measures, and ensure
equitable resource allocations.
Complete
2 - Leverage external funding to expand crisis response and continuum of shelter and housing programs
with regional partners
a. Homekey - Utilize State Homekey funding to implement Calle Joaquin Homekey project, providing 75
permanent supportive housing units which are scheduled to be fully occupied in Q1 of FY-25 the Fall of 2027.
*Updated to reflect People's Self Help Housing Timeline. Phase II construction to begin in April 2026 and
construction is tentatively scheduled to be complete in summer 2027.
FY 2026 Q1
FY 2027 Q4*
b. Encampment Resolution Funds - Complete outreach work as described in the City's Subrecipient Agreement
with SLO County for implementation of the Welcome Home Village project to address encampments along the Bob
Jones Bike Trail.
FY 2026 Q4
c. Other Funding Opportunities - Actively seek and vet additional funding sources to expand crisis response efforts
and continuum of shelter programs in collaboration with regional partners. Report on any progress to Council in
Q4 of FY26-27, unless grant applications are brought to Council for approval in advance of that timeline.
FY 2027 Q4
3 - Implement the Homelessness Response Strategic Plan (HRSP)
a. Safe Parking - Facilitate implementation of the Rotating Overnight Safe Parking Pilot Program in partnership
with CAPSLO and local faith community partners to expand safe parking capacity and address vehicular
homelessness.
FY 2027 Q4
b. Hotel Voucher Program - Continue implementation of Hotel Voucher Program to provide expanded capacity at
40 Prado Homeless Services Center as the CAPSLO Family Shelter is developed at 46 Prado Rd. FY 2027 Q4
c. Feedback Sessions - Conduct feedback sessions with six key stakeholder groups to inform updates to the HRSP
and address specific issues related to health, safety, and community well-being for each stakeholder group. FY 2027 Q3
d. HRSP Update - Update the HRSP for 2027-2031 in alignment with the Countywide Plan to Address
Homelessness. FY 2027 Q4
Homelessness Response Estimated
Completion
Date
81 Page 347 of 454
4 - Refine approaches to reduce the impacts of homelessness to balance safety, health, and community
well-being
a. SLOPD CAT & CSO Teams - Continue/refine operation of a coordinated homelessness response including the
Police Department's Community Action Team (CAT), Licensed Psychiatric Technician contracted through the
County's Behavioral Health Department and a Community Service Officer (CSO). Identify potential funding sources
to ensure sustainability of CAT and CSO positions the Licensed Psychiatric Technician Program.
FY 2027 Q4
b. SLOFD MCU Team - Continue/refine operations of the Fire Department's Mobile Crisis Unit (MCU), including
integration of a Licensed Psychiatric Technician contracted through the County's Behavioral Health Department.
Identify potential funding sources to ensure sustainability of MCU positions.
FY 2027 Q4
c. Outreach & Coordination - Facilitate bi-weekly interdepartmental field team meetings and bi-weekly inter-
agency outreach meetings to coordinate outreach, enforcement, and encampment cleanup efforts to reduce
community-wide impacts of homelessness.
FY 2027 Q4
d. Ask SLO - Receive and respond to community member Ask SLO requests related to homelessness response and
transient encampments to more efficiently address health and safety concerns. In response to Ask SLO requests,
Homelessness Response staff will coordinate Field Team process for posting camps, conducting outreach, storing
belongings, addressing cleanup needs, and tracking data in alignment with the City's CAMP Standards.
FY 2027 Q4
e. Environmental Mitigation - Coordinate efforts to mitigate environmental impacts and protect creek systems in
collaboration with regional agencies including quarterly meetings with Caltrans, CHP, and SLO County. Develop
and implement a Vegetation Management Plan.
FY 2027 Q4
Homelessness Response (Continued)
82 Page 348 of 454
1 - Advance street safety improvements and support Vision Zero goals for all road users
a. Start construction of the 2025 Arterials Paving project which could include streets such as Sacramento Dr, Tank
Farm, and Calle Joaquin depending on available funding.Complete
b. Start construction of the 2026 Roadway Sealing Project in Pavement Areas 2 & 3.FY 2027 Q1
c. Start construction of the South/King Signalized Crossing FY 2026 Q3
d. Start construction of the California/Taft Roundabout. *Updated due to legal timeframes for eminent domain
process which must be completed prior to releasing the project for bids.
FY 2026 Q4
FY 2027 Q3*
2 - Continue implementation of the Active Transportation Plan, including expansion of multimodal
transportation networks to improve connectivity, advocating for regional financial support as necessary.
a. Start construction of the Higuera Complete Streets Project. *Updated due to time required to incorporate final
design revisions based upon Council direction received in February 2026.
FY 2026 Q3
FY 2027 Q1*
b. Complete the South Broad St. Corridor Plan and initiate Demonstration Project.FY 2027 Q4
c. Complete public outreach and concept design for the Foothill Complete Streets project. *Updated due to
staffing constraints.
FY 2026 Q4
FY 2027 Q3*
d. Promote the Roll and Stroll Education Campaign. Ongoing
e. Bring final recommendation for Grand Avenue to Council to be implemented with the 2027 Paving Project.FY 2027 Q3
3 - Ensure public spaces, roads, and utilities support future growth and development
a. Finalize the design plans for construction of the Prado Bridge Widening Project.FY 2027 Q4
b. Complete the WRRF Upgrade Project. Complete
c. Complete the Prado Interchange Final Value Engineering Report and Council Update.Complete
d. Evaluate and implement EV firefighting tools and technology to protect waterways and infrastructure.FY 2026 Q4
e. In collaboration with Avila Ranch contractor, pursue design and construction of interim Fire Station 5 to achieve
a projected opening date of 2028.FY 2029
4 - Build out park infrastructure to support community recreation and accessibility
a. Start construction of Righetti Ranch Park (Phase 1).FY 2026 Q2
b. Start construction of Devaul Ranch Playground Replacement Project. *Updated because final design was
paused to allow time to apply for a Parks and Recreation Grant, and amend the design if the grant is awarded.
FY 2026 Q3
FY 2027 Q3*
c. Advertise for construction bids for the Emerson Park Replacement Project. *Updated due to additional public
input on the dog park component of the project which will require design modifications.
FY 2027 Q1
FY 2027 Q3*
5 - Support policies and programs aimed at expanding mass transportation and public transit
a. Execute new SLO Transit Operations and Maintenance Agreement.FY 2026 Q2
b. Reinstate transit services to pre-pandemic levels.Complete
c. Increase route frequency and reduce headways consistent with recommendations of the 2025 Short Range
Transit Plan.FY 2027 Q4
d. Provide transit service to San Luis Ranch and Avila Ranch neighborhoods.FY 2027 Q4
e. Expand and promote the Downtown Access Pass (DAP) program.FY 2027 Q4
Infrastructure and Sustainable Transportation
Estimated
Completion
Date
83 Page 349 of 454
1 - Continue implementation of the Climate Action Plan (CAP) and Lead by Example (LBE) Plan Work
Programs
a. Adopt and implement updated energy reach codes (e.g., local amendments to the 2025 California Energy Code)
(CAP)FY 2027 Q2
b. Work with CAPSLO to complete the Department of Energy Buildings Upgrade Prize pilot projects (installing
energy efficiency upgrades in 10 low-income occupied manufactured homes) and report to Council on potential
energy bill savings next steps (CAP)
FY 2027 Q2
c. Complete the 2027-2031 Climate Action Plan and GHG Inventory Update (CAP)FY 2027 Q3
d. Complete publicly accessible EV charging projects at various City property while continuing to develop policy
and funding resources to expand access to EV charging infrastructure on public and private property (CAP)FY 2027 Q3
e. Convene a circular economy stakeholder forum to inform future circular economy actions (CAP) FY 2027 Q1
f. Partner with the Integrated Waste Management Authority (IWMA) to develop and distribute waste education
materials to HOAs and property managers, with a focus on food waste diversion in high-turnover multi-family
complexes and mobile home communities. (CAP)
FY 2027 Q4
g. Develop and adopt internal polices focused on zero emissions buildings, facilities, and vehicles (LBE)FY 2026 Q2
h. Complete investment grade audits for building electrification retrofits at Swim Center, City Hall, and
Corporation Yard (LBE). *Updated due to contracting with PG&E taking longer than expected.
FY 2027 Q1
FY 2027 Q3*
i. Conduct a year-long campaign to connect employees to low emissions commute options (LBE)FY 2027 Q3
j. Install publicly accessible EV charging projects at the Cultural Arts District Parking Structure.Complete
2 - Implement disaster mitigation efforts to reduce risks from floods and fires
a. Complete Construction of the Mid-Higuera Bypass Project Complete
b. Complete the Vegetation Management Plan (VMP)FY 2027 Q2
c. Treat at least 25 acres of vegetative fuels in high wildfire risk areas of City creeks and Open Space FY 2027 Q4
d. Complete Waterway Management Plan, Volume 1 update FY 2027 Q4
3 - Strengthen community resilience through emergency preparedness, community networks, and
planning efforts
a. Launch comprehensive community outreach and engagement opportunities on a quarterly basis that (i) provide
general climate resilience and disaster preparedness resources, (ii) incorporate climate justice considerations in
scheduling, location, and content, and (iii) support the projects described in MCG tasks 2b, 2c, and 2e
Ongoing
b. Empower community organizations to host "pop-up" resilience hub events and support block and neighborhood-
level preparedness efforts Ongoing
c. Evaluate Community Emergency Response Team (CERT) / Listos program alternatives for community
engagement and resiliency, and evaluate community receptivity to "Firewise" community designations FY 2027 Q4
d. Conduct a study session to consider options for funding stormwater and / or creek maintenance and flood
preparedness in support of CASE programs. Removing this task is recommended at this time due to other potential
funding measures on the ballot this fall and to avoid placing additional burden on the community. Other funding
sources are available, such as Measure G20, which identifies stormwater improvements, creek maintenance, and
flood preparedness as priority uses.
FY 2027 Q3*
Estimated
Completion
Date
Open Space, Climate Action, and Resilience
84 Page 350 of 454
4 - Protect, sustain and advance open space and natural and historic resources
a. Pursue priority land conservation opportunities to expand the Greenbelt, identify funding opportunities and
resources, and engage with priority landowners on an annual basis Ongoing
b. Complete Johnson Ranch Open Space Riparian Restoration Project FY 2027 Q3
c. Revive traditional ecological knowledge and cultural activities on City Open Space through annual engagement
and dialogue with the leadership of local indigenous tribes FY 2027 Q4
d. Plant at least 125 native trees in Open Space through partnerships in furtherance of the "10 Tall" goal FY 2027 Q3
e. In partnership with Friends of La Loma Adobe, complete property boundary adjustment, initiate structural
stabilization of the adobe, and complete trailhead connection as part of the Reservoir Canyon Natural Reserve FY 2027 Q4
5 - Expand trail connectivity and accessibility to support biking, hiking, and outdoor enjoyment for all
community members
a. Implement Firefighter Trail realignment at Reservoir Canyon Natural Reserve FY 2027 Q4
b. Implement HiBar and Panorama Trail extensions at Miossi Open Space FY 2027 Q4
c. Initiate Morro View to Durata Vista Connector Trail at Irish Hills Natural Reserve FY 2027 Q4
d. Enhance accessibility for all through bilingual docent led hikes, Junior Ranger Camp, and environmental
education FY 2027 Q4
e. Develop a sustainable trail strategy plan that incorporates passive recreation, public amenities, and equitable
access, while ensuring natural resource protection FY 2027 Q3
Open Space, Climate Action, and Resilience (Continued)
85 Page 351 of 454
Department Summary Administration and IT
Administration and IT Department
Department Summary
The City Administration and Information Technology Department oversees many of the daily operations
of the City of San Luis Obispo, ensuring effective implementation of the City Council policies and programs.
As a lead department for several of the Council’s Major City Goals, it provides strategic leadership, policy
guidance, and operational support to advance the City’s priorities.
Through the Office of the City Manager, the department plays a key role in public affairs and
communications – promoting transparency, fostering community engagement, and representing San Luis
Obispo’s interests at the regional, state, and federal levels. A major initiative in 2026-27 is completing the
final phase of the City’s education and outreach plan to prepare the community for the transition to
Citywide Single Vote in the November 2026 elections. Staff will also begin developing a long-term strategic
plan as part of the 2027-29 Financial Planning process, as directed by the City Council.
The Office of Economic Development and Tourism drives local economic growth by supporting businesses
and strengthening the economy through tourism and placemaking. In 2026-27, major efforts include
launching and promoting the “SLO Grown Business Support” program and implementing the FY 2026-28
Strategic Marketing and Business Plan to increase demand for San Luis Obispo. This work includes
updating partnership strategies and advancing the next phase of the SLO Life Coach brand campaign.
The Office of Diversity, Equity, and Inclusion works to make the City organization and community more
inclusive. Key efforts include advancing the DEI Strategic Plan, continuing the Belonging Project with
quarterly sessions, and launching Minority- and Women‑Owned Business listening sessions to inform
more inclusive economic strategies. Internally, the Office is developing four equity-focused staff
workshops to build skills and strengthen an inclusive workplace culture. Together, these efforts support
both community engagement and internal capacity in alignment with the Strategic Plan.
The Office of Sustainability and Natural Resources leads key environmental efforts, including the Climate
Action Program, Natural Resources, and Creeks and Watersheds. Current work focuses on implementing
the Open Space, Climate Action, and Resiliency Major City Goal. Priorities include conserving the
Greenbelt, advancing sustainable trail projects, providing environmental education, and updating the
Climate Action Plan for 2027–2031. The City will also update its vegetation management plan, expand
wildfire fuel reduction, improve flood protection, and update the Waterways Management Plan.
Together, these efforts strengthen open space protection, land and water management, and climate
resilience.
The department also oversees the City Clerk’s Office, which ensures open government and public access
to records. Alongside supporting the 2026 elections and the transition to Citywide Single Vote, a major
initiative for the Clerk’s Office in FY 2026–27 will be implementing new policies and procedures to ensure
full compliance with SB 707, a new transparency law taking effect July 1. The department also includes
the City’s Information Technology division, which provides essential network infrastructure, technical
support, and strategic IT planning. IT also leads the implementation of Oracle enhancements, ensuring
continuous compliance, implementation of MOU provisions, and integration with evolving City business
processes. The division is also involved in community-based projects, like the implementation of the City’s
first Broadband Plan.
The department also includes the Assistant City Manager (ACM) position. In addition to supporting the
86 Page 352 of 454
Department Summary Administration and IT
overall needs of the organization and the work of the City Manager, the ACM serves as the Community
Services Group (CSG) administrator, overseeing the Directors of Public Works and Utilities, Community
Development, and Parks and Recreation departments. The purpose of this CSG administrative position,
which reports directly to the City Manager, is twofold: 1) focus on improving customer service,
process/programmatic efficiencies, and collaboration within and between the CSG departments, and 2)
enhance coordination between the CSG departments, Administration and IT and other City departments.
Departmental Budget
Staffing note: Development of the 2025-27 Financial Plan occurred in conjunction with labor negotiations
with San Luis Obispo City Employees’ Association and the unrepresented bargaining groups. Contingencies
for negotiated cost of living and benefits adjustments were included in a non-departmental cost center in
FY 2025-26, leading to artificially high departmental staffing budget increases in FY 2026-27.
The Department’s budget also includes changes to appointed official compensation as approved by the
City Council on May 5, 2026.
Changes from Financial Plan
Staff recommends $53,100 in budget changes for ongoing operating costs in FY 2026-27 to cover increased
software costs, and County election costs, as well as $40,000 in one-time funding to pilot a statistically
valid community survey to better understand community sentiment.
The Administration and IT budget includes $175,700 in reductions across staffing, contract services, travel
and training, and other operating expenditures. Key savings include modifying leases for tower space on
Tassajara Peak through a co-location partnership with the County, reducing underutilized contract
services and travel expenses, and right-sizing software licenses to align with approved employee counts.
Additional savings will be realized by eliminating a vacant 0.5 FTE Administrative Assistant position in the
City Clerk’s Office. This position, approved by Council during FY 2021-22 to support hybrid public meetings,
has remained vacant since its approval and the transition to hybrid meetings in July 2026 will be managed
with existing resources. In addition, the department’s budget was reduced by $36,000 as the half‑time
Administrative Assistant position previously assigned to support the Assistant City Manager is being
reallocated to the Human Resources Department. Because the Assistant City Manager no longer requires
dedicated administrative support, this half-time position can be better utilized by centralizing temporary
recruitment functions within Human Resources. Additional details on this reorganization are provided in
the Human Resources and Parks and Recreation department write‑ups.
Performance Measures
Actuals Budget Supplement
Administration & IT FY 2024-25 FY 2025-26 FY 2026-27
Staffing 6,868,995$ 7,139,371$ 7,648,071$
YoY Change 2%4%7%
Other Operating Expenditures 4,696,196 4,180,267 3,985,129
YoY Change -3%-11%-5%
Total 11,565,191$ 11,319,639$ 11,633,200$
YoY Change 0%-2%3%
87 Page 353 of 454
Department Summary Administration and IT
Objective: Provide public information to as many people in San Luis Obispo as possible.
Strategic Goal: Inform and engage the community
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Notes: When users provide input on a topic via Open City Hall, they are asked how they liked using it. This measure allows
staff to track how satisfied users are with the engagement tool itself.
Measure: Number of email subscribers 15,000 15,050 20,000
Notes:
Measure: Number of Pageviews on slocity.org 1,700,000 1,781,000 2,300,000
Notes: Changes in expected targets are due to elections (2025-26 is a non-election year, whereas 2026-27 is an election
year)
Objective: Provide information and receive feedback to inform climate resilience activities through internal and
external engagement events and opportunities.
Strategic Goal: Work toward the community and organization neutrality goals
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Number of cross-departmental Green Team meetings 10 10 10
Notes: Implementation of the City’s Lead by Example Plan is coordinated through the Green Team function
Measure: Number of community engagement events and opportunities 10 10 10
Notes: Community engagement events will focus on community wildfire preparedness and resilience, as well as the 2027-
2031 Climate Action Plan Update
Objective: Provide reliable IT resources to the organization and community.
Strategic Goal: Support the efficient and effective delivery of City services
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Maintain City Network Reliability Uptime Status 99.9% 99.9% 99.9%
Notes: This measures regular network uptime. Network uptime allows for the City to measure the percentage its systems
are available to service department and public needs.
Measure: Data backed up in Terabytes 185 215 240
Notes: This measures the amount of data backed up by IT and informs the City’s storage needs forecasting
The increase in data backed up in terabytes is attributed to the growth of digital evidence. Significant
increases are anticipated to continue, and the 2026-27 target was adjusted accordingly.
Objective: Advance inclusion and belonging by growing staff capacity and improving access and engagement
for all community members.
Strategic Goal: Create a more welcoming and inclusive organization and community
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Staff Capacity 5 7 5
Notes: Number of Citywide workshops or related training for staff provided annually.
Measure: Community Engagement 14 33 16
88 Page 354 of 454
Department Summary Administration and IT
Notes: Number of DEI-led or supported community efforts annually.
The higher than anticipated number of Community Engagement efforts reflects a significant increase in
outreach capacity over the past year. With the expansion of the team to include two full-time staff
members and support from student interns and College Corp Fellow, the Office has been able to be more
consistently present in the community. This has included a deliberate effort to attend, support and
participate in a wider range of community events and initiatives, strengthening connections and
increasing access and belonging across the City.
Objective: Advance economic development and tourism efforts that contribute to the community’s quality of
life.
Strategic Goal: Support business development and job creation
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Business Welcome Program 17 19 19
Notes: Number of start-up checklists created as a part of the Business Welcome Program.
Measure: Business Contacts 85 160 95
Notes: Number of contacts with businesses regarding attraction, retention, or expansion in the City.
Expanded visibility of the Business Support Program, including the implementation of online appointment
scheduling, has contributed to an increase in projected business contacts.
89 Page 355 of 454
Department Summary City Attorney
City Attorney
Department Summary
The legal services program is a support function that provides legal advice and representation to the City
Council, all City departments, and City Advisory Bodies to accomplish Major City Goals, other important
objectives, and core operational functions in accordance with the law.
With the requested approval for Fiscal Year 2026-27 of a Regular 0.75 FTE Deputy City Attorney position
to replace a long-standing, supplemental attorney position, the department is planning for the
recruitment and onboarding of its newest staff member while simultaneously preparing for longer term
transitions. For years, the City Attorney has worked to build a sustainable staffing structure to support the
legal advisory and prosecutorial needs of the City, and in the First Quarter of Fiscal Year 2026-27
department staff will discuss and assess internal and external needs, with the goal of confirming
organizational needs and effectiveness, finding efficiencies where possible, and setting reasonable
expectations for the future.
While the department works toward long term staffing and service level sustainability with a focus on
succession and development and ongoing management of claims, litigation and public records response,
staff also foresee the need to provide significant legal support for: the transition to Citywide Single Vote;
negotiations of development agreements and/or review of significant development projects; updates to
City fee programs; implementation of fire severity zone changes and enhanced emergency medical
response approaches; major CIP projects including Prado Road; and implementation of significant
community partnership agreements, including SLO Museum of Art and SLORep.
Departmental Budget
Staffing note: Development of the 2025-27 Financial Plan occurred in conjunction with labor negotiations
with San Luis Obispo City Employees’ Association and the unrepresented bargaining groups. Contingencies
for negotiated cost of living and benefits adjustments were included in a non-departmental cost center in
FY 2025-26, leading to artificially high departmental staffing budget increases in FY 2026-27.
The Department’s budget also includes changes to appointed official compensation as approved by the
City Council on May 5, 2026.
Changes from Financial Plan
Actuals Budget Supplement
City Attorney FY 2024-25 FY 2025-26 FY 2026-27
Staffing 1,351,385$ 1,513,000$ 1,641,722
YoY Change 10%12%9%
Other Operating Expenditures 301,359 144,575 330,845
YoY Change 26%-52%129%
Total 1,652,745$ 1,657,573$ 1,972,569$
YoY Change 12%0%19%
90 Page 356 of 454
Department Summary City Attorney
The City was served with a lawsuit in Spring of 2026 and while initial funding was budgeted in FY 2025-26,
an additional $170,000 has also been added to the FY 2026-27 budget for litigation defense matters.
The FY 2026-27 budget also includes $30,000 in new funding and $15,000 transferred from the Police
Department for mediation services, with the contract to be managed through the City Attorney’s Office.
This funding is responsive to a Council expressed desire to once again provide mediation services to the
community at no cost to resolve neighborhood conflicts, non-criminal police calls for service, tenant
landlord issues, and more.
The budget reductions for the department, directed by City Council in March 2026, totaled approximately
$60,000 with half coming from various contract reductions and the other half resulting from the transition
of the existing 0.6 FTE supplemental Assistant City Attorney position to a 0.75 FTE regular Deputy City
Attorney.
Performance Measures
Objective: Efficient and Transparent Administrative Appeals Program
Strategic Goal: Department Objectives
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Administrative Citation Appeals received by the City 125 85 100
Measure: Appeals closed without need of a hearing 60 28 35
Measure: City assisted corrections to defective appeals to allow access to
hearing 40 24 30
Measure: City facilitated hearings on the record without need for personal
appearance by Appellant 30 21 25
Measure: Number of hearing days scheduled 25 13 15
The October 2024 implementation of an appeal fee for Hearing Officer review continues to decrease the
overall number of appeals received. Prior to this fee implementation, many appellants used the appeal
process to delay payment of their fine even when there was no substantive basis for the appeal. Staff
now, instead, have many conversations about the purview of the Hearing Officer and with requests for
payment plans for fines directed toward the Finance Department. The decrease in overall appeals
coincides with a decrease in the number of hearing days needed.
Objective: Legal Training & Compliance
Strategic Goal: Department Objectives
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Number of Council, Staff, and Advisory Body legal trainings, legal
updates, and compliance advisory sessions 20 24 20
91 Page 357 of 454
Department Summary City Attorney
Objective: Municipal Claims, Litigation, & Prosecution Management
Strategic Goal: Department Objectives
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Percentage of liability claims against the City resulting in litigation <5% 3.6% <5%
Measure: Liability claims against the City reviewed/managed 70 83 75
Measure: Budget increases required to fund defense of the City and address
unexpected complex legal issues. $175,000 $264,000 $300,000
Measure: Number of multi-count complaints filed for misdemeanor municipal
code violations 30 17 20
The budget increases required to fund defense of the City is higher than expected in FY 2025-26 due to
multiple personnel investigations that became necessary, increased complexity of a receivership matter,
and continued work in support of the transition to Citywide Single Vote for Council Member elections.
The forecast for FY 2026-27 is also higher since the budget is recommended for a $170,000 one-time
increase due to existing litigation.
The number of multi-count complaints filed in FY 2025-26 dropped due to fewer underlying misdemeanor
citations being issued. This can be attributed to a variety of factors, potentially including positive progress
through the efforts of the Community Action Team (CAT) and Mobile Crisis Unit (MCU) and partnerships
with field teams to connect individuals with services. Sadly, another reason for the decrease is that
individuals who have historically engaged in behaviors generating high volume citations passed away. This
is also why the forecast for next year is lower than expected.
92 Page 358 of 454
Department Summary Community Development
Community Development Department
Department Summary
The Community Development Department guides and facilitates the growth and development of the
community through the work of the Administration, Planning, Engineering, and Building & Safety
divisions. Plans for new development and construction are reviewed by the Community Development
Department to ensure compliance with standards and policy objectives, and neighborhood wellness and
community safety are addressed through the code enforcement and building and safety teams. The
department provides services directly to the public through the public counter, building inspections, code
enforcement, and planning services, and also facilitates the work of a number of City boards and
commissions, including the Planning Commission, Architectural Review Commission, Cultural Heritage
Committee, Tree Committee, and Construction Board of Appeals.
The upcoming fiscal year includes a substantial portfolio of initiatives driven by Major City Goals, changing
state laws, and a desire to facilitate housing in the community. In FY 2026–27, the department will
continue to lead the implementation of the Housing and Neighborhood Livability and Homelessness
Response Major City Goals, while monitoring progress and ensuring that General Plan policies and zoning
regulations remain aligned with evolving municipal service needs and state laws. This includes work to
continue to develop the Safe Housing Program, improve the Below Market Rate housing program, and
implement the current Housing Element and update the Homelessness Response Strategic Plan. In
addition, planning for the next City Budget and Housing Element Cycle will begin in FY 2026-27 as the City
develops a Request for Proposal (RFP) for the important years-long Housing Element Update project and
researches rental registry program development costs for potential inclusion in the next budget. The
department also continues to work closely with the Fire Department to implement new Wildland Urban
Interface (WUI) regulations and update the tree ordinance in light of the WUI adoption. The Code
Enforcement Division will also continue its multi-year effort to improve service delivery, consistency, and
efficiency amid rising case volumes, while also focusing on neighborhood livability and safe housing. This
includes evaluating program structure and resource allocation; updating and formalizing standard
operating procedures; refining enforcement priorities and workload distribution; addressing outdated or
unclear code provisions; enhancing use of service request platforms such as ASK SLO; and improving data
tracking, reporting, and case management practices.
Departmental Budget
Staffing note: Development of the 2025-27 Financial Plan occurred in conjunction with labor negotiations
with San Luis Obispo City Employees’ Association and the unrepresented bargaining groups. Contingencies
for negotiated cost of living and benefits adjustments were included in a non-departmental cost center in
Actuals Budget Supplement
CDD FY 2024-25 FY 2025-26 FY 2026-27
Staffing 6,313,612$ 6,416,659$ 6,997,832
YoY Change 12%2%9%
Other Operating Expenditures 1,551,204 1,957,998 1,669,824
YoY Change 1%26%-15%
Total 7,864,816$ 8,374,657$ 8,667,656$
YoY Change 10%6%3%
93 Page 359 of 454
Department Summary Community Development
FY 2025-26, leading to artificially high departmental staffing budget increases in FY 2026-27.
Changes from Financial Plan
Following the Council’s approval of the proposed strategic expenditure reductions on March 3, 2026
(Item6b), the Community Development Department’s budget has been reduced by 2.13%, totaling
$170,125. The staffing related reductions do not result in the elimination of any positions.
The recommended budget includes $4,667 to increase the annual allocation of bus tokens for CAPSLO
clients served at the 40 Prado Homeless Services Center. For the past four fiscal years, the City has
allocated $14,000 to provide 9,000 tokens annually. As CAPSLO’s client volume has grown, the monthly
distribution of 750 tokens has consistently fallen short of demand, with supplies often exhausted before
the end of the month, leading to repeated requests for additional tokens. CAPSLO requests that, during
the FY 2026–27 contract review process, the City approve a cost increase to expand the annual allocation
from 9,000 to 12,000 bus tokens. If approved, the increase will ensure CAPSLO can meet essential client
transportation needs, including travel to medical appointments, social service providers, employment
opportunities, and daily access to the 40 Prado Homeless Services Center. Most clients do not have
vehicles and rely heavily on public transit. This action supports the City’s Homelessness Response Strategic
Plan and aligns with the Major City Goal for Homelessness Response, including ongoing collaboration with
CAPSLO to strengthen services at 40 Prado.
Performance Measures
Performance measures are designed to determine accountability, improve service quality, allocate
resources, and evaluate departmental performance in meeting San Luis Obispo’s goals and objectives.
Objective: Affordable Housing
Strategic Goal: Housing
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Number of affordable housing units secured through entitlements or
construction. 50 64 50
Notes: This performance indicator helps determine the City’s progress toward meeting the affordable housing segments of its
Regional Housing Needs Assessment (RHNA).
Objective: Ensure a Safe Community
Strategic Goal: Housing
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Percent Code Enforcement cases investigated on time: First Tier – 24
Hours, Second Tier – 2 Days, and Third Tier – 3-5 Days 85% 63.3% 85%
Timeliness of initial responses to code enforcement investigation requests fell short of the initial target,
largely due to a sustained rise in service demand. Investigation requests have increased by approximately
130% since FY 2021–22, based on partial-year data, and are projected to grow by more than 200% from
FY 2021-22 to FY 2025-26 if current trends continue. During this period, on time response rates declined
from 79.8% in FY 2021–22 to 59.6% in FY 2024–25. Performance has improved in the current fiscal year
94 Page 360 of 454
Department Summary Community Development
to 63.3%, reflecting the stabilization of staffing levels and increased efficiency as recently hired staff
reached full proficiency. However, workload remains elevated, and cases continue to increase in both
volume and complexity. Although not all requests are completed by the assigned due date, most are
resolved shortly thereafter: approximately 89% within three days and about 97% within two weeks. These
short delays indicate timing challenges rather than persistent backlog. Staff continue to prioritize urgent,
life safety, and legally mandated cases. Ongoing modernization efforts aim to further enhance efficiency
and better align service levels with demand.
Objective: Development Review Activities
Strategic Goal: Other Department Objectives
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Percent of projects that are reviewed within defined cycle times 75% 87% 75%
Notes: Staff recommends keeping the target goal of meeting cycle times 75% of the time and not raising the target at this
time. This is due to the fact that the department continues to experience an increase in more complex and resource
intensive development review activities.
Objective: Provide Excellent Customer Service
Strategic Goal: Other Department Objectives
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Customer survey response positivity rate 90% 91.41% 90%
Notes: Customers in Community Development are given a survey to gauge satisfaction and collect feedback to inform
ongoing improvement efforts.
Objective: Building Permit Review Activities
Strategic Goal: Economic Stability
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Percent of building permit reviews completed within established cycle
times (all departments). 75% 51% 75%
Notes: This measure considers data from all departments and divisions that review permits.
Despite not meeting the target, performance continues to show steady, meaningful improvement. On
time completion rates increased from 33% in 2022–23, to 50% in 2023–24, to 51% this fiscal year. In
addition, further analysis of the data reveals that 25% of the permit reviews that were not completed on
time were completed within one day of their due date. Recent software upgrades, including expanded
digital submittal capabilities, automated routing, and improved applicant access to project information,
are contributing to the positive trend in review times, however, remaining process inefficiencies and
staffing constraints continue to affect final turnaround times. Staff remain focused on refining workflows
and strengthening efficiency to build on the progress made to date.
95 Page 361 of 454
Department Summary Finance
Finance Department
Department Summary
The Finance Department is responsible for managing the City’s financial operations in accordance with
applicable law, policies, standards, and procedures. This includes the preparation of the City’s budget and
financial reports, administration of the City’s treasury and revenue operations, management of the City’s
fiscal resources, and administration of the accounting functions including indirect City‐wide costs not
easily charged to operating programs or projects. The department prepares the City’s audit and its
Comprehensive Annual Financial Report as well as the Popular Annual Financial Report. The department
also facilitates the procurement of goods and services to support departments in providing City programs
and services. Lastly, the department assists the City Manager’s office in monitoring and reporting on both
annual revenues and expenditures.
In the last year, the department has made progress on a number of important initiatives. With adoption
of the 2025‐27 Financial Plan, staff signaled to the City Council and community that the long‐term forecast
for the General Fund identified deficits in the out years, due to the City’s requirement to bring a fifth Fire
Station online. The expansion of fire service, coupled with economic uncertainty and slowed revenue
growth compared to what the City experienced in recent years due passage of the Local Revenue Measure
in 2020 and the post‐Covid surge, necessitated a budget Citywide budget balancing exercise which
includes the recommended expenditure recommendations included with this budget. The Finance
Department led this effort, in coordination with the City Manager.
In addition to a heavy focus on budget balancing to ensure the sustainability of the City’s operations, the
department continues to focus on updating policies and procedures to meet the current needs of the
organization and our customers. The department has made a number of improvements to the annual
Business License renewal process to enhance communications with local business operators to increase
compliance with Municipal Code requirements and ensure collection of Business Tax; additional
improvements are still in progress and staff expect to hold a study session with the City Council in early
2027 to discuss and recommend changes to Business License program administration overall (see revised
Major City Goal, “Cultural Vitality, Economic Resilience, and Fiscal Sustainability,” Work Plan Item 5.d.).
In addition, the department is in the process of making updates to the City’s Purchasing Policy, with an
intent to streamline administrative processes while still ensuring proper stewardship of taxpayer dollars.
The department continues to work closely with Information Technology and Human Resources staff to
improve the Oracle ERP. In the last year, staff completed a multi‐year effort to improve the calculation of
overtime which has significantly increased the efficiency of payroll processing and helped to reduce errors.
A number or Oracle ERP projects are currently underway and Finance Department staff continues to
provide regular Oracle trainings as well as trainings on other Finance topics to staff Citywide.
Finally, staff continues to work with the Federal Emergency Management Agency (FEMA) and California
Office of Emergency Services (CalOES) to secure reimbursement for the City’s unbudgeted costs related
to the 2023 Winter Storms. The City has received $1.9 million in reimbursements to date and is cautiously
optimistic that future reimbursement will be received, though the timing is uncertain.
96 Page 362 of 454
Department Summary Finance
Departmental Budget
Staffing note: Development of the 2025‐27 Financial Plan occurred in conjunction with labor negotiations
with San Luis Obispo City Employees’ Association and the unrepresented bargaining groups. Contingencies
for negotiated cost of living and benefits adjustments were included in a non‐departmental cost center in
FY 2025‐26, leading to artificially high departmental staffing budget increases in FY 2026‐27.
Changes from Financial Plan
Staff’s recommendation includes ongoing funding to meet the increased cost to print and mail Local
Revenue Measure annual reports and business license renewals, as well as two contractual cost increases.
The recommended budget also includes an SOBC for one‐time funding in the amount of $60,000 to fund
consultant work to prepare a user fee study.
The recommended budget also includes $29,935 in expenditure reductions from the prior year as part of
the budget balancing exercise. These cost savings were primarily driven by reductions to software licenses
and functionality and by elimination of contracts to outsource certain tasks which staff will perform going
forwards.
Performance Measures
Objective: Financial Stability
Strategic Goal: Fiscal Policies
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Number of calendar days following year‐end until the Annual
Comprehensive Financial Report (ACFR) is issued 170 180 180
The City is legally required to publish the ACFR within 180 days and finds this timeline sufficiently
challenging to meet with little value in publishing earlier, given that the document typically is not ready
until it is presented to the City Council in mid‐January to early February.
Objective: Financial Stability
Strategic Goal: Fiscal Management
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Twelve‐month total rate of return on the City’s investment portfolio 3.0% 3.0% 3.0%
Actuals Budget Supplement
Finance FY 2024-25 FY 2025-26 FY 2026-27
Staffing 2,108,755$ 2,196,169$ 2,402,509$
YoY Change 18%4%9%
Other Operating Expenditures 577,836 574,187 615,651
YoY Change 16%-1%7%
Total 2,686,591$ 2,770,356$ 3,018,160$
YoY Change 18%3%9%
97 Page 363 of 454
Department Summary Finance
Measure: General Fund debt service as a percent of revenue 1.5% 1.5% 1.5%
The twelve‐month rate of return is outside the City’s control. Returns on the City’s portfolio can be volatile
and can change drastically due to changes in market conditions.
Objective: Financial Stability
Strategic Goal: Customer Service
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Percent of business licenses renewed timely, prior to enforcement
action being taken 95.0% 95.3% 95.0%
Measure: Number of Finance‐led trainings provided to City staff 13 18 15
The department has exceeded the FY 2025‐26 target related to Business License renewals due to a focused
effort to encourage business operators to update their contact information with the City if needed, and
efforts to communicate renewal requirements at least monthly during business license renewal time.
The department expects to exceed its target for trainings in the current year. Staff have led many
unplanned, additional trainings driven by non‐recurring needs like rollout of new software functionality.
98 Page 364 of 454
Department Summary Fire
Fire
Department Summary
In addition to providing exceptional and compassionate emergency response, the Fire Department
embraces comprehensive fire prevention and community risk reduction strategies that include fire and
life safety inspections, plan review services, fire/arson investigation, fire safety and public safety
education, and City emergency management. The Fire Department has automatic and mutual aid
agreements with surrounding departments, California Office of Emergency Services, and the Los Padres
National Forest. With the values of Service, Loyalty, Ownership, Family, Integrity, Respect and Excellence,
the Department’s vision is to be a progressive organization that leads the community in public safety and
preparedness demonstrated through an unwavering commitment to the protection of lives, property, and
our environment. The service the department provides will be of the highest quality recognized against
local, state, and federal standards.
During FY 2025-26, notable achievements included: (1) Delivery of replacement Engine 4, that was
ordered in 2022 and custom built for the City; (2) In conjunction with the Finance Department completed
financing agreement with JPMorgan for the purchase of Engine 5 in preparation for new Station 5; (3) Fire
Prevention Bureau completed 100% of 699 state mandated inspections; (4) the Emergency Manager
enrolled the first San Luis Obispo neighborhood as a voluntary FireWise community; and (5) Responded
to over 7,300 calls, including 150 fires.
Departmental Budget
Changes from Financial Plan
Staff is recommending one new budget change, which is the reclassification of the Mechanic Helper to a
Heavy Equipment Mechanic, with an increased cost of $12,578. The Mechanic Helper position has been
vacant since November when the previous Mechanic Helper was promoted and moved to the Public
Works Fleet Division. After a failed recruitment for a Mechanic Helper, it was determined that reclassifying
the position would increase the viable candidates. A Heavy Equipment Mechanic brings a higher level of
expertise that would increase the capacity of the Fire Fleet division who frequently work into the night
and come in on weekends to complete emergency repairs as well as regular maintenance.
Staff also recommends $43,872 in budget changes for ongoing operating costs in the FY 2026-27. Of those,
Actuals Budget Supplement
Fire FY 2024-25 FY 2025-26 FY 2026-27
Staffing 17,542,815$ 16,907,084$ 17,651,320
YoY Change 18%-4%4%
Other Operating Expenditures 1,244,335 1,155,828 1,117,972
YoY Change 12%-7%-3%
Total 18,787,150$ 18,062,912$ 18,769,292$
YoY Change 18%-4%4%
99 Page 365 of 454
Department Summary Fire
$20,260 is for fuel due to increased price per gallon. Year over year, the diesel price per gallon is up nearly
50% and gasoline is up 30%. Staff’s recommendation is based on a 20% increase under the assumption
that fuel prices return to normal over the year. Software costs for essential functions including scheduling,
inventory tracking, and training will increase $7,500 in the next fiscal year. Supplies used on medical calls,
which account for 60% of the department’s calls, will go up $6,000 due to increased prices and the
addition of new equipment and medications mandated by the local regulatory agency required to be
carried on all frontline apparatus. $6,814.40 is requested for cost increases on required equipment such
as tires, hose, and personal protective equipment (PPE) for firefighters. Memberships costs for
organizations that staff belong to such as National Fire Protection Agency (NFPA) and Certified Unified
Protection Agency (CUPA) are increasing $3,300.
The Fire Department recommends eliminating the three firefighter over-hire positions that are currently
vacant. Minimum daily staffing at the fire department is fourteen (14) firefighters per day plus a fifteenth
firefighter scheduled without a regular assignment daily as an over-hire over three shifts. This results in a
total of three unassigned over-hire firefighter positions. These three positions are used to backfill
positions when others are on leave or there is a vacancy and they have been vacant since Summer 2025.
Eliminating these positions will provide $450,000 of salary savings that is recommended to be reallocated
to the department’s overtime budget that has been underfunded for several years. (There is also a
currently vacant firefighter position assigned to the MCU that is not included in this recommendation.)
Performance Measures
Fire departments report incident data to the United States Fire Administration (USFA), an agency within
Federal Emergency Management Agency (FEMA) to create a national picture of fire, EMS, rescue,
hazardous materials, and other emergency response activity. While federal reporting is not mandatory it
is incentivized through eligibility for all federal grant programs.
Fire departments use third party report management software integrated with USFA to report the data
for efficiency, consistency and accuracy. This software also allows the department to track staffing,
deployment analysis and accreditation- which are the metrics used for the department’s objectives and
goals. San Luis Obispo City Fire uses the most widely used software in the state including by Cal Fire.
On January 1, 2026, USFA sunset the legacy reporting platform and implemented the new National
Emergency Response Information System (NERIS). The transition included revised incident classifications
and updated reporting requirements. Although the Fire Department’s records management system
successfully submitted required incident data, several supplemental reporting modules, including
accreditation and performance metrics, were delayed pending vendor updates. While the module became
operational in mid-May 2026 metrics are reflecting results outside the established targets despite no
corresponding operational change. To address these challenges, staff have been actively coordinating
with the software vendor to implement required system updates and improve functionality. Staff have
participated in industry training and conference sessions focused on the transition and anticipate
continued improvements in data consistency and reporting reliability as system refinements are
completed. Staff expects full reporting functionality within the coming months and anticipates improved
accuracy and reliability of performance metrics presented in future budget documents, including the fiscal
year-end budget report.
100 Page 366 of 454
Department Summary Fire
Objective: Deliver Timely Effective Response to ensure rapid care and hazard mitigation
Strategic Goal: Other Department Objectives
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Meet the Total Response Time (TRT) goal of 7 minutes or less to 90%
of all lights-and-siren emergencies in the City as defined by the Department’s
Master Plan. TRT Includes Call Processing Time, Turnout Time, and Travel Time.
7:00 unavailable 7:00
Measure: Meet the Call Processing Time goal of 1 minute or less to 90% of all
lights-and-siren emergencies in the City as part of TRT. 1:00 unavailable 1:00
Measure: Meet the Turnout Time goal of 2 minutes or less to 90% of all lights-
and-siren emergencies in the City as part of TRT. 2:00 unavailable 2:00
Measure: Meet the Travel Time goal
of 4 minutes or less to 90% of all lights-and-siren emergencies in the City as part
of TRT.
4:00 unavailable 4:00
Notes: Travel time is impacted by construction, traffic, and expanded response zones. Some distant locations with greater
travel times generate a large portion of calls increasing travel time.
While it is not anticipated the department will meet the Total Response Time performance targets in FY
2025-26, they remain unchanged due to National Fire Protection Association recommended standards.
As the only metric the department has full control over, the goal to meet Turnout Time of 2 minutes or
less to 90% of all lights-and-sirens emergencies in the City has been met.
Objective: Deliver Timely Effective Response to ensure rapid care and hazard mitigation
Strategic Goal: Housing
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: % of Fire Department Development Review activities completed within
published cycle times 80% 68% 80%
This metric is tracking below target for the year due to staff turnover and training needs. Staff is working
to improve response times.
101 Page 367 of 454
Department Summary Human Resources
Human Resources
Department Summary
Human Resources provides comprehensive organizational support, including benefits administration,
recruitment, compensation, labor relations, risk management, performance management, training and
development, and legal compliance.
During FY 2025-26, notable achievements included:
(1)Completing a Citywide Employee Engagement Survey;
(2)Negotiating a successor MOU with SLOCEA, prior to contract expiration, for the first time in 25 years;
(3)Implementing a new Roth 457 option for employee retirement savings;
(4)Providing Gallup strengths training in-house due to HR Analyst becoming a certified strengths coach;
(5)Supporting the reorganization of Public Works and Utilities into one Department;
(6) Complying with new regulations, such as AB 339 and AB2561;
(7) Recruiting for a new Fire Chief; and
(8)Accepting a Liability Risk Management Award from the California Joint Powers Insurance Authority.
The department is fully staffed for the first time in five years, and the newest members of the team are
getting fully trained in their roles. The team will soon be in a position to move more projects forward that
have previously been deferred.
The department continues to partner with the Centre for Organization Effectiveness and the California
Joint Powers Insurance Authority to provide professional development opportunities for employees and
supervisors across the organization. A committee has been established to explore enhancements to
benefits that would further support employees caring for family members or experiencing disability. In
addition, a consultant has been selected and work has begun on consolidation and enhancement of the
Deferred Compensation program offered to employees.
There has been a notable increase in the number of employee relations cases, requests for leaves of
absence and disability accommodations, as well as issues requiring either intervention, training or formal
investigation, which have added to staff workload as well as the need for assistance from specialized
consultants.
Related to the City’s Risk Management Program, the City’s Insurance Fund is structured to maintain an
adequate reserve to accommodate fluctuations in liability and workers’ compensation costs. In February
2026, as part of the FY 2025-26 Second Quarter Budget Report, the City Council approved a one-time
transfer of $802,799 from unassigned fund balance to align the Insurance Fund reserve with the City’s
Fund Balance and Reserve Policy. The Policy states that the Insurance Fund will be funded based on 150%
of the previous five-year average claims experience (e.g., claims paid, reserves for known claims, and
administrative expenses). The Policy further states that the Insurance Fund will maintain a reserve
sufficient to guard against substantial claims which will be determined based on annual actuarial report
information. To reach the actuarially recommended funding level as of October 10 ,2025, which reflects
a 75% probability level of covering existing and future claims, the Insurance Fund would require an
additional $3,110,581. Staff will continue to monitor the Insurance Fund balance and will provide
102 Page 368 of 454
Department Summary Human Resources
opportunities for the Council to consider future unassigned fund balance allocations in the coming years.
Overall, the department focused on and achieved its highest priority goals and will continue to pursue
opportunities for efficiency and enhancements that will further support the City’s workforce.
Departmental Budget
Staffing note: Development of the 2025-27 Financial Plan occurred in conjunction with labor negotiations
with San Luis Obispo City Employees’ Association and the unrepresented bargaining groups. Contingencies
for negotiated cost of living and benefits adjustments were included in a non-departmental cost center in
FY 2025-26, leading to artificially high departmental staffing budget increases in FY 2026-27.
Changes from Financial Plan
Additional funding of $5,000 is requested due to a change in ownership for the City’s Medical Service
Provider and a resulting need to renegotiate the contracted pricing. This provider conducts pre-
employment physicals, DMV physicals for commercial drivers, and vaccinations for occupational
exposures.
Recommended budget reductions totaling $48,200 include non-renewal of a software contract that is not
meeting the City’s needs, reduction of consultant support for position re-classifications and division re-
organizations, a reduction in cost for public safety preventative mental health services due to
reimbursement available from the California Joint Powers Insurance Authority, and a reduction in cost for
public safety dispatcher testing software as there was a negotiated price decrease.
In addition, the City will be implementing a reorganization during the 2026-27 fiscal year in which the
regular half-time Administrative Assistant position previously assigned to support the Assistant City
Manager in the City Administration Department will be reallocated to the Human Resources Department.
The Assistant City Manager no longer requires dedicated administrative support, allowing the half‑time
resource to be better utilized by centralizing temporary recruitment functions within the Human
Resources Department. Currently, the Parks and Recreation Department, which employs between 200
and 300 temporary or seasonal staff annually, relies on its full-time Administrative Assistant to coordinate
temporary recruitments, with approximately 20 hours of the position’s weekly schedule devoted to these
duties. As a result, transitioning this work to Human Resources, who oversee recruitments for all
departments, will help to streamline and enhance recruitment processes citywide. This shift will also allow
Actuals Budget Supplement
HR FY 2024-25 FY 2025-26 FY 2026-27
Staffing 1,492,891$ 1,595,615$ 1,711,434
YoY Change 13%7%7%
Other Operating Expenditures 593,095 442,218 406,003
YoY Change -30%-25%-8%
Total 2,085,986$ 2,037,833$ 2,117,437$
YoY Change -4%-2%4%
103 Page 369 of 454
Department Summary Human Resources
the Parks and Recreation Administrative Assistant to focus more fully on ongoing department
administrative support duties. This change does not affect the City’s overall FTE count and results in a net
savings of $36,000. This is achieved by reducing the Parks and Recreation Department’s temporary staffing
budget by $36,000, decreasing the City Administration budget by the same amount to reflect the
reallocated half‑time position, and adding $36,000 to the Human Resources budget to support the
position’s reassignment.
Performance Measures
Objective: Attract and retain top talent to meet the needs of the organization.
Strategic Goal: Decrease time to hire through efficient recruitment processes.
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Number of New Hires Processed 130 58 130
Measure: Median Time to Hire 85 days 61 days 75 days
A hiring chill was in place for the first eight months of FY 2025-26, and there was less turnover compared
to the prior fiscal year, reducing the number of recruitments and resulting in fewer new hires. The median
time to hire also decreased due to filling more positions through internal promotions as well as through
existing eligibility lists.
Objective: Attract and retain top talent to meet the needs of the organization
Strategic Goal: Increase employee engagement and satisfaction, resulting in fewer vacancies and
increased tenure.
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Median Tenure of Regular Workforce 5 years 6 years 5 years
Measure: Vacancy Rate 9% 7.8% 9%
Objective: Empower employees to reach their full potential
Strategic Goal: Facilitate an evaluation system to deliver clear performance expectations and regular,
timely feedback.
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Percentage of On-Time Performance Evaluations 95% 97% 95%
Objective: Reduce the total cost of workers’ compensation claims
Strategic Goal: Facilitate return to work through modified duty assignments to support employee wellbeing
while also minimizing costs.
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Percentage of Eligible Employees Offered a Modified Duty Assignment 80% 81% 80%
104 Page 370 of 454
Department Summary Parks and Recreation
Parks and Recreation
Department Summary
The Parks and Recreation Department is committed to providing high-quality parks, facilities, and
programs that promote health, wellness, and community connection. Key assets such as the SLO Swim
Center, Damon-Garcia Sports Complex, and Laguna Lake Golf Course serve as community hubs while staff
provide recreational programs, special events, youth and senior services, and cultural and educational
opportunities throughout the City. Through these offerings, the department fosters community
engagement and enhances quality of life through leisure, cultural, and social pursuits.
In addition to maintaining and activating recreational spaces, the department protects and preserves the
City’s 4,050 acres of natural resources and open spaces and manages the Citywide Public Art and
Volunteer programs. Guided by the Parks and Recreation Blueprint for the Future, the department
continues to prioritize inclusive programming, environmental stewardship, and community-building
initiatives.
In FY 2026-27, the department will focus on key initiatives across multiple service areas, including
advancing Public Art policy updates and Master Plan review, making progress on the Open Space Strategic
Trail Plan, strengthening recreational field preparation operations and staffing for recreational
programming, and supporting capital improvements at the Golf Course, including the bridge project and
Pro Shop renovation. The department will also evaluate service delivery models for the golf program and
facility, including assessing fee structures, to ensure long-term sustainability and alignment with
community needs.
The Parks and Recreation budget is primarily comprised of personnel costs. In addition to full-time staff,
the department relies heavily on a supplemental workforce, which may range from 150 to 200 employees
depending on the season. These employees support essential services such as aquatics programming,
childcare, facility operations, open space fuel reduction, and community event support. This staffing
model enables the department to deliver consistent, high-quality services while remaining responsive to
the evolving needs of the community.
Departmental Budget
Staffing note: Development of the 2025-27 Financial Plan occurred in conjunction with labor negotiations
with San Luis Obispo City Employees’ Association and the unrepresented bargaining groups. Contingencies
for negotiated cost of living and benefits adjustments were included in a non-departmental cost center in
FY 2025-26, leading to artificially high departmental staffing budget increases in FY 2026-27.
Actuals Budget Supplement
Parks & Rec FY 2024-25 FY 2025-26 FY 2026-27
Staffing 5,099,308$ 5,245,267$ 5,630,608
YoY Change 12%3%7%
Other Operating Expenditures 914,852 977,429 888,612
YoY Change 7%7%-9%
Total 6,014,160$ 6,222,696$ 6,519,221$
YoY Change 11%3%5%
105 Page 371 of 454
Department Summary Parks and Recreation
Changes from Financial Plan
Following the Council's approval of the proposed strategic expenditure reductions on March 3, 2026 (Item
6b), the Parks & Recreation Department's budget has been reduced by 1.47%, totaling $90,042. The
reductions to staffing do not result in the layoff of any filled positions.
The recommended budget does not include any expenditure additions. Recommended reductions totaling
$90,042 were strategically selected to minimize community impact and are primarily driven by improved
operational efficiencies in temporary staffing, elimination of low-utilization contract class offerings,
consulting services, and alignment of operating budgets with recent actual spending trends. Temporary
staffing costs in the Facilities Division have been reduced following a reorganization of set-up and
takedown procedures for the Downtown Dining Program at Mission Plaza, resulting in a more efficient
operational model. Contract Services reductions reflect the elimination of Strategic Plan Implementation
consulting, a roughly 20% reduction in contract class offerings based on enrollment and financial
performance, reduced funding for contracting for open space cleanups due to increase by in-house staff
clean-ups, and contracts for live music at special events. The remaining reductions span travel and
training, advertising, recreation supplies, and miscellaneous operating line items across the Jack House,
Rangers, Golf, Volunteer, and Community Services programs, largely in areas identified where actual
spending has historically fallen below budget.
In addition, the department reduced the temporary staffing budget for administrative support by
approximately $36,000 as part of a City reorganization. As outlined in the Human Resources Department’s
summary, temporary recruitment functions currently performed by the Parks and Recreation
Administrative Assistant will be centralized within Human Resources during the 2026-27 fiscal year. With
these responsibilities transitioning out of the department, the remaining administrative duties can be
redistributed between the regular full-time position and temporary staff, resulting in a net savings of
$36,000.
Performance Measures
Objective: Provide inclusive, accessible programming that serves the whole community
Strategic Goal: Provide quality childcare to the community to support economic recovery through regional
partnerships to enhance and expand childcare offerings to the community
2025-26
Target
2025-26
Projected
Actual
2026-27 Target
Measure: Number of youth sports registrations (clinics and
leagues) 1,800 2,092 1,800
Measure: Number of adult sports registrations (clinics and
leagues) 2,950 3,186 3,200
Measure: Number of senior programs/events offered 82 77 82
Measure: Number of contract class enrollments 800 675 700
Measure: Number of youth swim lessons enrollments 930 930 930
Measure: Number of aquatics facility entries (lap swim, rec
swim, etc.) 81,000 73,000 76,000
Measure: Number of total golf rounds 24,000 23,815 25,000
106 Page 372 of 454
Department Summary Parks and Recreation
Measure: Number of youth camp registrations/available spots 2800/2800 2727/2800 2800/2800
Measure: Number of school year childcare spots offered/filled 1675/1675 1675/1675 1675/1675
Measure: Number of children receiving subsidy
60 CAPSLO
25 City
Scholarship
60 CAPSLO
45 City
Scholarship
60 CAPSLO
40 City Scholarship
The number of youth sports registrations in FY 2025-26 is projected to exceed the target, reaching 2,092
compared to the goal of 1,800, reflecting stronger-than-anticipated participation for futsal. The FY 2026-
27 target will remain at 1,800, as current program capacity and staffing levels are designed to support this
baseline, with flexibility to accommodate higher demand if needed and if the appropriate amount of
volunteer coaches are provided through the City’s partner agency, YMCA.
The number of adult sports registrations in FY2025-26 is projected to exceed the target, reaching 3,186
compared to the goal of 2,950, indicating stronger-than-anticipated participation due to drop-in leagues.
The 2026–27 target will remain at 3,200 to reflect this sustained demand while maintaining a realistic
baseline for program capacity.
The number of senior programs and events offered in FY 2025-26 is projected to fall slightly below the
target, with 77 delivered compared to the goal of 82. The FY 2026-27 target will remain at 82, reflecting a
continued emphasis on providing creative and interactive senior programming.
The number of contract class enrollments in FY 2025-26 is projected to fall below the target, with 675
enrollments compared to the goal of 800. This has been a continuing downward trend despite increased
marketing. The FY 2026-27 target enrollment has been reduced to 700 to reflect declining enrollment
patterns, as well as staff have assessed lower enrollment classes and non-popular classes for elimination
to support budget reductions.
The number of aquatics facility entries in FY 2025-26 is projected to fall below the target, with 73,000
entries compared to the goal of 81,000, reflecting reduced usage, particularly among high school user
groups with Atascadero High School reopening their pool facility. The FY 2026-27 target has been adjusted
downward to 76,000, from 81,000, to better align with current participation trends while maintaining
capacity for potential increases in use.
Youth camp registrations in FY 2025–26 are projected to fall slightly below target, with 2,727 registrations
compared to the goal of 2,800. This shortfall is primarily due to the cancellation of the Junior Ranger Camp
(spring session) because of staffing vacancies and leaves of absence, as well as the introduction of a new
Golf Camp that is still building enrollment. (Youth Services out-of-school, traditional childcare camps, met
their annual target of 2,500 spots and will remain as such, with expectations that resources and demand
remain the same.) The FY 2026-27 department target will remain at 2,800, reflecting expectations that
staffing levels will stabilize and participation in newer programs will grow with continued marketing
efforts.
The number of children receiving subsidies in FY 2025-26 remains consistent with the CAPSLO program
target of 60 participants. City Scholarship utilization has exceeded the original target of 25, with 37
scholarships issued to date and a projected year-end total of approximately 45. While issued scholarships
total approximately $37,000, only $18,000 has been utilized to date, indicating that a portion of awarded
funds has not yet been utilized by recipients. Based on current demand and utilization trends, the 2026-
107 Page 373 of 454
Department Summary Parks and Recreation
27 City Scholarship target has been increased to 40 participants to better align with anticipated usage
levels of approximately $25,000.
Objective: In coordination with Public Works, engage the public to prioritize new and revitalized Recreational
Amenities
Strategic Goal: Initiate public engagement for prioritization of projects, focused on meeting amenity needs
identified by the City-wide inventory assessment and specific to City subareas.
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Number of public outreach meetings 4 2 2
Measure: Number of updated or new parks and amenities in
process 3 4 4
The number of Public Outreach Meetings in FY 2025-26 is projected to fall below target, with two meetings
held for Emerson Park and Righetti Community Park. For FY 2026-27, the target has been reduced from
four to two to better align with anticipated project activity, including a project kick-off meeting for
Emerson Park and a public meeting for playground replacements at Vista Lago and DeVaul Parks.
The projected actual for FY 2025-26 and the FY 2026-27 target both reflect four ongoing park projects
initiated in 2025-26: Righetti Community Park, Emerson Park, and playground replacements at Vista Lago
and DeVaul Parks.
Objective: Creates and fosters a sense of community through citizen involvement
Strategic Goal: Activate parks and public spaces through community focused events, including volunteer
opportunities, and public art that promote inclusivity, provides cultural unity, develops a sense of community
and supports healthy lifestyles.
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Number of Department Community Events (free or
low-cost) 25 25 25
Measure: Number of total volunteers/hours 700/6000 1308/6588 1000/6200
Measure: Number of volunteer opportunities 35 48 40
Measure: Number of Public Art or Cultural Art Events 9 16 9
Measure: Number of temporary/permanent public art
installations 24 23 12
Volunteer participation in FY 2025-26 significantly exceeded the target due to the inclusion of Advisory
Body members in total counts and increased Single Day of Service opportunities. To reflect this expanded
tracking approach, the FY 2026-27 target for total volunteers has been increased from 920 to 1,000, while
volunteer hours remain unchanged at 6,200.
The number of Volunteer Opportunities exceeded the FY 2025-26 target due to increased City
department/divisional demand for both recurring and single-day volunteer roles. Because many
opportunities span multiple fiscal years, the FY 2026-27 target has been adjusted upward, from 35 to 40,
to better reflect ongoing volunteer opportunities.
108 Page 374 of 454
Department Summary Parks and Recreation
The FY 2025-26 target for Public Art and Cultural Events was exceeded due to additional Box Art
Anniversary events and community mural project paint days. Despite this increase, the FY 2026-27 target
will remain unchanged, as these events are not expected to occur at the same frequency annually.
Objective: Open Space Preservation and Enhancement
Strategic Goal: Continue to develop new trail networks and maintain the current Open Space acres and trail
system while focusing on riparian area conservation with encampment clean-ups, fire fuel reduction, and
creek and flood control.
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Number of miles of Open Space trails maintained 68.5 70 72
Measure: Number of staff hours dedicated to fuel reduction 4,000 4,000 4,000
Measure: Number of encampment site clean-ups removed from
Open Spaces 55 52 55
The FY 2026-27 target for miles of Open Space trails maintained has been increased from 69.5 to 72 miles
after meeting the prior target in FY 2025-26. The mileage was added to Righetti and Reservoir Canyon
open space properties. Ranger staff anticipate expanding Miossi and adding additional miles at Reservoir
Canyon open spaces, contributing to the higher target.
109 Page 375 of 454
Department Summary Police
Police
Department Summary
The Police Department is responsible for maintaining a safe city by working in partnership with the
community. Goals of the department are to protect life and property, prevent and reduce crime, and
improve the quality of life for residents and visitors alike. The department has two bureaus; Administrative
Services and Operations. Administrative Services includes the following work divisions: Administration,
Investigations, Communications, and Records. The Operations bureau includes Patrol, Traffic Safety, and
Neighborhood Outreach.
Important initiatives for FY 2026-27 include continuing to work on the department’s strategic plan,
prioritize staffing needs (as outlined in the department’s staffing study), working with Public Works on a
tenant improvement project for 1042 Walnut, and continuing to foster community trust and strengthen
partnerships.
Departmental Budget
Changes from Financial Plan
The department’s Significant Operating Budget Changes include budget increases in contract services
primarily for costs related to animal control services, janitorial, and annual software renewals.
As a result of budget reductions, the department eliminated the Data Crime Analyst position. The funding
from the elimination of this position is recommended to be reallocated to the department’s overtime
budget.
Performance Measures
Objective: Reduce Crime
Strategic Goal: Create a safe community for residents and visitors.
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Total Number of Part 1 Crimes per Year 1,536 1,210
(calendar 2025) 1,521
Actuals Budget Supplement
Police FY 2024-25 FY 2025-26 FY 2026-27
Staffing 23,073,521$ 23,764,483$ 24,985,624
YoY Change 7%3%5%
Other Operating Expenditures 1,583,597 1,834,080 1,898,577
YoY Change -1%16%4%
Total 24,657,118$ 25,598,563$ 26,884,201$
YoY Change 6%4%5%
110 Page 376 of 454
Department Summary Police
Notes: Includes homicide, forcible rape, robbery, aggravated assault, burglary, and motor vehicle theft. Figures shown are
for the calendar year.
Objective: Provide Safe Roadways for Pedestrians, Vehicles, and Bicyclists
Strategic Goal: Utilize the department’s Traffic Safety division to focus on traffic enforcement and create safe
roadways.
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Total Number of Collisions per Year
Vehicle:539
Ped: 31
Bicycle: 49
Vehicle: 528
Ped: 35
Bicycle: 59
Vehicle:534
Ped: 30
Bicycle: 48
Notes: Figures shown are per calendar year.
Measure: Annual Office of Traffic Safety (OTS) Grant
Enforcement Operations
DUI Checkpoint:
2 DUI Checkpoint: 2 DUI Checkpoint:
2
DUI Saturations:
14
DUI Saturations:
14
DUI Saturations:
20
Traffic
Enforcement
Ops: 14
Traffic
Enforcement
Ops: 14
Traffic
Enforcement
Ops:14
Distracted
Driving Ops: 14
Distracted Driving
Ops: 14
Distracted
Driving Ops:14
Ped/Bike
Enforcement: 2
Ped/Bike
Enforcement: 2
Ped/Bike
Enforcement: 2
Traffic Safety
Education: 2
Traffic Safety
Education: 2
Traffic Safety
Education: 2
Notes: Figures are based on specific grant related objectives outlined in the annual grant agreements which may vary from
year to year. The OTS grant period is from October - September.
Objective: Reduce Homeless Related Calls for Service Through Proactive Engagement
Strategic Goal: Utilize the department's Community Action Team (CAT) to provide resources and services to
the City's homeless community.
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Calls for service related to homelessness 8,272 8,145 8,024
Notes: Figures shown are based on fiscal year.
Measure: Number of unique individuals contacted by CAT 419 568 550
Notes: Figures shown are based on fiscal year.
Measure: Number of Family and Agency Reunifications 7 6 7
Notes: Figures shown are based on fiscal year.
Measure: Number of Local Permanent Housing Referrals 2 85 85
Notes: Figures shown are based on fiscal year.
Measure: Total number of Mental Health/Substance Abuse
Treatment Referrals 221 225 228
Notes: Figures shown are based on fiscal year.
Projected actuals for the number of unique individuals contacted by CAT and the number of local
permanent housing referrals are much higher than anticipated for FY 2025-26. This increase is a direct
result of increased CAT staff, which includes the Licensed Psych Technician (contracted with the County
of San Luis Obispo Behavioral Health) and a Community Service Officer. Adding these positions to CAT
has allowed for increased outreach.
111 Page 377 of 454
Department Summary Public Works
Public Works and Utilities (Public Works Branch)
Department Summary
On November 18, 2025, City Council approved the consolidation of the individual Public Works and
Utilities Departments, creating a single Public Works and Utilities Department. As this merger occurred
partway through a fiscal year, and many aspects of these departments are not yet fully joined, this
document will separately represent the budgetary aspects of the Public Works Branch and the Utilities
Branch of the department.
The core function of the Public Works Branch is to preserve and enhance City infrastructure for an
accessible, safe, and inclusive community experience. The Public Works Administration program
continues to work toward greater efficiencies for the entire department.
The Parks Maintenance program provides the community with safe facilities and well‐maintained parks,
sport fields, and other landscaped areas. The Urban Forest program continues to maintain nearly 14,000
inventoried tree assets valued at over $39 million, and is doing its part to help the City meet its goal of
planting 10,000 new trees by 2035.
The Swim Center Maintenance program continues to provide a safe and clean aquatic facility for the
community’s use. The Facilities Maintenance program efficiently maintains approximately 242,000 square
feet of buildings and plays a critical role in the oversight and delivery of CIP projects at City facilities.
Routine replacement of roll‐up doors at fire stations and other City facilities, as well as the re‐roof and
other exterior improvements to the Parks & Recreation building, are planned for FY 2026‐27.
The Streets and Sidewalk Maintenance program addresses sidewalk and pavement needs, conducts storm
patrols during rain events, and manages trash, green waste, and metal recycling at the Corporation Yard.
The program also supports traffic control for events and emergencies and handles encampment cleanups
throughout the City.
The Traffic Signals & Streetlighting program maintains safe operations through regular maintenance,
repairs, and updates, including ADA upgrades and Pedestrian Hybrid Beacons.
The Fleet Maintenance program is responsible for purchasing, outfitting, maintaining, and repairing
approximately 304 City‐owned fleet assets. Additional responsibilities include emissions reporting;
maintenance of the Corporation Yard fuel pumps, car wash, and backup generators; hazardous waste
handling and disposal reporting; and parts inventory management. Staff complete approximately 55–65
preventative maintenance work orders each month, in addition to addressing unscheduled repairs and
breakdowns.
The Fleet Maintenance program continues to support City operations while advancing the City’s fleet
electrification goals. During the past year, the program purchased six (6) electric vehicle (EV) pickups, one
(1) EV patrol vehicle, one (1) EV motorcycle, and an EV forklift telehandler for the Water Resource
Recovery Facility (WRRF). Staff also oversaw the installation of three (3) new charging stations to support
the growing electric fleet. The program will continue expanding its electrified fleet and supporting
infrastructure in the coming year.
112 Page 378 of 454
Department Summary Public Works
The CIP Project Engineering program continues to advance and deliver Capital Improvement Plan projects
funded for design and construction. The program successfully delivered several legacy capital projects this
year, including the Mid‐Higuera Bypass Project, WRRF, and the Cultural Arts District Parking Structure. In
FY 2026‐27, staff will continue to advance several important projects, including construction of the new
Righetti Community Park, a revitalization of Emerson Park, construction of city‐wide broadband
infrastructure, and the City’s annual paving project.
The Transportation Planning & Engineering program has continued its progress on cross‐town traffic
circulation enhancements and its ongoing implementation of the City’s Active Transportation Plan, in
coordination with the Mobility Services Division and CIP Engineering Division. FY 2025‐26 highlights
included the completion of complete street improvements to Sacramento and Tank Farm Road as part of
the 2025 Paving Project, advancement of the Higuera Complete Streets Project, and advancement of the
California/Taft Roundabout Project. In FY 2026‐27, staff will advance the Foothill Complete Streets and
South Broad Street Complete Streets corridor planning efforts with the recent addition of a contract
transportation planner, and construction of the Higuera Complete Streets and South & King Crossing
Projects is expected to be complete by the end of FY 2026‐27.
The Active Transportation program supports the Transportation and CIP teams in advancing key active
transportation infrastructure projects. It also supports the Lead By Example (LBE) Employee Commute
Campaign, promotes the ongoing Roll & Stroll bicycle and pedestrian education campaign, hosts
sustainable transportation pop‐up education and training events, and assists in supporting a potential
future bikeshare pilot program.
Departmental Budget – General Fund
Staffing note: Development of the 2025‐27 Financial Plan occurred in conjunction with labor negotiations
with San Luis Obispo City Employees’ Association and the unrepresented bargaining groups. Contingencies
for negotiated cost of living and benefits adjustments were included in a non‐departmental cost center in
FY 2025‐26, leading to artificially high departmental staffing budget increases in FY 2026‐27.
Actuals Budget Supplement
Public Works FY 2024-25 FY 2025-26 FY 2026-27
Staffing 10,375,919$ 11,270,127$ 11,994,994
YoY Change 6%9%6%
Other Operating Expenditures 6,205,976 6,158,466 5,927,067
YoY Change 2%-1%-4%
Total 16,581,895$ 17,428,593$ 17,922,061$
YoY Change 5%5%3%
113 Page 379 of 454
Department Summary Public Works
Changes from Financial Plan
Staff are recommending the following ongoing changes to line items from the FY 2025‐27 Financial Plan
based on cost increases, which total $117,000 in FY 2026‐27.
1. Parks - Janitorial Services ($8,000). This will be used to fund contract increases, including CPI ($6,000),
as well as the additional cost to provide janitorial services to the Mission Plaza facilities ($2,000).
2. Bottle Brush Trimming on Madonna Road ($1,000). This will be used to fund cost increases for this
work, which entails bottle brush trimming along Madonna Road.
3. Steam Cleaning/Pressure Washing Increases ($17,000). This increase accounts for inflation and
supports the increased frequency of pressure washing in the downtown area, which is needed to
address food and beverage spills, human waste, and other periodic unforeseen maintenance needs
that arise throughout the year. In addition to this operating budget increase, the proposed CIP also
includes an increase to the Sidewalks and Pressure Washing account to support additional summer
ficus berry cleaning efforts and economic development‐related maintenance requests.
4. Weed Abatement ($2,000). This accounts for actual cost increases based on current trends as well as
the additional areas that require this service in Righetti Ranch.
5. Asphalt Mix/Road Repair/Bonding Agents ($5,000). This will help mitigate rising oil costs that are
affecting asphalt and other pavement materials.
6. Fuel Cost Increases ($84,000). This will likewise mitigate fuel cost increases that are sharply rising.
This represents a 20% increase from FY 2025‐26 budget.
Staff are also recommending the following ongoing budget additions to address critical safety and liability
concerns.
1. Vehicle Telematics in City Fleet (General Fund) ($38,000). This will reduce liability by providing exact,
accurate vehicle information and driving behavior at the time of accidents, which can assist with claim
and lawsuit defense by removing speculation and alleged allegations. It provides cost savings through
emissions reporting and real‐time diagnostics. The Utilities Branch has made a similar request for
vehicles funded by the Water and Sewer enterprise funds.
2. Electrical Panel Inspections ($12,000). Annual, preventative maintenance inspections on large panels
by a licensed electrician with proper NFPA 72 protection will assist in identifying issues prior to
catastrophic failure, which can result in a serious safety concern and leave facilities without power for
long periods of time.
Additionally, negotiated cost of living adjustments and other staffing changes that took effect in FY 2025‐
26 were not factored into the staffing budget, so the FY 2026‐27 budget reflects two years of increases.
114 Page 380 of 454
Department Summary Public Works
Performance Measures
Objective: Enhance safe and efficient transportation
Strategic Goal: Proactively enhance safety by providing a system of safe, reliable, and well‐maintained roadways,
sidewalks, traffic signals and streetlights.
2025-26
Target
2025-26
Projected Actual
2026-27
Target
Measure: Pavement Condition Index (PCI)
70 74 70
Measure: Bicycle network total miles (Class I/II/III/IV)
14.6/28.6/24.9/5.4 14.6/31.0/24.9/3.0 14.6/26.2/26.9/7.8
Measure: Street miles maintained 144 144 144
Measure: Citywide fatal and severe injury crashes (latest
annual total/5‐year running average)
18/17.6 23/19.6 16/15.7
Actual bicycle network miles completed for 2025‐26 are below initial targets established for this year
because (a) final designs for Tank Farm Road as part of the 2025 Paving Project did not include Class IV
(protected) bike lanes as initially contemplated due to concerns from emergency services, and (b) the
Higuera Complete Street Project, which was initially planned to be in construction in 2025 was deferred
to a 2026 construction start. While noteworthy improvements to active transportation infrastructure
were achieved in 2025‐26 along Tank Farm Road and Sacramento Drive with the 2025 Paving Project,
these improvements unfortunately are not fully reflected when reporting metrics in terms of net change
in bicycle facility mileage by type.
The FY 2025‐26 target for Citywide fatal and severe injury crashes is based on a 10% reduction and 2026‐
27 target is based on a 20% reduction from 2023 annual total and 2018‐2023 5‐year averages. Annual and
5‐year running averages for fatal/severe injury crashes remain above targets initially established for 2025‐
26. The City’s Vision Zero Action Plan, scheduled for final Council consideration in May 2026, includes a
comprehensive series of recommendations to address these concerning safety trends; however, the
ability to implement the Plan recommendations will be dependent on engineering and enforcement
staffing and financial resources. Key factors contributing to an influx in fatal/severe injury crashes include
intoxicated/distracted driving, illegal speeding, and failure to yield right‐of‐way to pedestrians and
cyclists. Several prominent capital improvement projects are currently in progress that will advance key
engineering recommendations of the Vision Zero Action Plan for high‐crash corridors, including the
Higuera Complete Street Project, South/King Crossing Project, California/Taft Roundabout Project, and
forthcoming South Broad Street and Foothill Complete Street Projects.
115 Page 381 of 454
Department Summary Public Works
Objective: Effectively manage City assets
Strategic Goal: Provide core services to the community with particular focus on Enhanced Downtown
Maintenance and providing maintenance services for recently constructed development projects that are ready
to be assumed into the City’s inventory for maintenance; continue to use Ask SLO as a tool to respond to
community needs.
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Public Works Maintenance Division Ask SLO
requests addressed
1,660 1,713 1,660
Measure: # of trees maintained 13,579 13,499 13,679
The projected FY 2025‐26 value for Ask SLO requests is based on daily volume of Maintenance requests.
This number is challenging to forecast, but is not expected to decrease as increasing numbers of residents
use Ask SLO.
The urban forest number of managed trees has been aligned with the Public Works Maintenance
Division's scope of services. Many trees in the City’s open space have been removed from the Urban Forest
Services maintenance metrics, as these trees are maintained by the Parks and Recreation Department’s
Ranger Services Program. The program will target 100 new tree plantings annually, with young tree care
provided by volunteers or community partners. The Urban Forestry crew planted nearly 50 new trees in
2025‐26; however, a majority of these trees were to replace dead or removed trees, which were already
accounted for in the inventory. Volunteer street tree planting efforts continue through ECO SLO, but
there is a delay in adding these plantings to the City’s inventory because initial care and watering are
completed by volunteers.
Objective: Plan and develop critical infrastructure
Strategic Goal: Invest in critical infrastructure with the focus of delivering legacy projects to the community.
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Total # of projects managed
65 65 42
The CIP Engineering Team manages a variety of capital projects with diverse funding sources and
originating from multiple departments. The 2025‐27 CIP prioritizes funding for projects that can be
realistically delivered within that timeframe. As a result, the project load in FY 2026‐27 is intentionally
reduced to align with available staffing and resources.
116 Page 382 of 454
Department Summary Public Works
Parking Fund
Fund Summary
The Parking Services program continues to execute its Technology Roadmap. New, easy‐to‐use on‐street
pay stations, a single mobile app, improvements to existing garage gating equipment, and improved
payment systems have streamlined the parking experience, while the 397‐space Cultural Arts District
Parking Structure (CADPS), completed in March 2026, significantly increases the number of affordable
parking spaces in downtown.
In the coming year, Parking Services will continue to digitize parking permits, replace single‐space meters
with updated, user‐friendly pay stations, and evaluate and refresh downtown curb markings and signage.
The program will also advance the design and installation of enhanced security features in the parking
garages.
Changes from Financial Plan
Staff are recommending the following ongoing SOBCs:
1. Increase Credit Card Merchant Fees ($80,867). This change funds the additional Credit Card
Merchant Fees anticipated alongside the additional revenue of the CADPS.
2. Consolidate Five (5) Part-Time Parking Compliance Officer (PCO) Positions to Two (2) Full-Time
Parking Compliance Officer I positions ($14,731). This change supports compliance with
Assembly Bill 1484 1, and addresses growing capacity challenges of several new timed parking
areas and an expansion of an existing parking district. The additional stability of full‐ti me PCO’s
working 10‐hour shifts would provide greater coverage year‐round.
1 Assembly Bill 1484, which became effective January 1, 2024, requires temporary employees who have been hired
to perform the same or similar type of work that is performed by represented permanent employees be
automatically included in the same bargaining unit as permanent employees.
117 Page 383 of 454
Department Summary Public Works
Fiscal Analysis – Revenue
Parking Fund revenue is forecasted to increase 9% in FY 2026–27, driven by the opening of the new
Cultural Arts District Parking Structure (CADPS) and revenues performing in line with projections from the
2024 Parking Rate Study. The forecast also includes a minor correction to employee parking revenue
assumptions to reflect the current permit rate of $45 per month, rather than the $85 per month previously
included in the adopted Financial Plan. This adjustment is reflected in “Other Revenue.” In addition,
technology upgrades identified in the Technology Roadmap — including new payment equipment in
parking garages and at on‐street locations, as well as mobile pay improvements — have now been fully
implemented and are operating as anticipated.
Parking meter revenue reflects hourly parking activity across on‐street and surface lot spaces, including
mobile app payments, and has been supported by the installation of new payment equipment in
November 2025. Parking garage revenue has also improved following the installation of new gating
equipment at the start of FY 2025–26, which is functioning as intended and resolving prior equipment
failures that impacted revenue. Continued growth is anticipated with the opening of the CADPS, consistent
with projections in the Financial Plan. Long‐term parking revenue, which includes on‐street, residential,
and garage permits, has increased following the reduction in garage permit rates effective July 1, 2024,
with sales expected to continue rising. Additional growth is anticipated with the expansion of the digital
permit platform in April 2026 to include 10‐hour on‐street permits, along with updated accounting to more
accurately reflect staff permit revenue.
Parking fines revenue includes all paid citations and reflects the implementation of a new citation
management system in March 2025. Based on current trends, no changes from the Financial Plan are
recommended.
Other revenue sources, including investment interest and rent and lease revenue, are performing as
expected. Investment income is projected to remain minimal due to reduced cash balances following
completion of the CADPS construction project, while rent and lease revenue continues to align with
existing agreements and typical end‐of‐year collection patterns. No adjustments to these categories are
recommended.
Actuals Budget Suppl ement
Parking Fund FY 2024-25 FY 2025-26 FY 2026-27
Meters 4,589,728$ 4,312,367$ 4,312,367$
YoY Change ‐23%‐6%0%
Structures 1,886,338 2,860,504 3,687,079
YoY Change 7% 52% 29%
Long ‐Term Parking 522,895 500,000 500,000
YoY Change ‐26%‐4%0%
Fines 1,113,016 1,231,100 1,276,500
YoY Change ‐6% 11%4%
Other Revenue 183,827 151,384 123,184
YoY Change 115%‐18%‐19%
Total Revenue 10,783,966$ 9,575,956$ 10,444,030$
YoY Change -19% -11%9%
118 Page 384 of 454
Department Summary Public Works
Fiscal Analysis ‐ Expenditures
No budget reductions were made to the Parking Fund’s Financial Plan baseline as part of the Council’s
recommendations in March. Parking Fund operating expenditures are proposed to increase by 5% due to
previously‐approved staffing adjustments and the two SOBCs referenced above. The Parking Program was
able to re‐allocate existing funding within the constrained base budget to offset all other identified
increases, including inflationary adjustments, utility increases, and CADPS maintenance and service costs.
Additionally, negotiated cost of living adjustments and other staffing changes that took effect in FY 2025‐
26 were not factored into the staffing budget, so the FY 2026‐27 budget reflects two years of increases.
Capital expenditures will decrease sharply with the completion of the CADPS project.
Parking Fund – Long Term Forecast
The long‐term forecast continues to show a return to forecasted revenues as a result of the changes
recommended by the Technology Roadmap. With the completion of new parking structure gating
equipment and implementation of new citation management software leading into FY 2025‐26, and the
completion of the Cultural Arts District Parking Structure in March 2026, revenue projections remain
unchanged.
It should be noted that the revenue projections for the "Parking Structures” for the years FY 2025‐26 to
FY 2028‐29 are based on revenue forecasts of the 2024 Parking Rate Study which assume that occupancy
of the new Cultural Arts Parking Garage will realize similar per space revenue as the other three existing
garages now that it is open. However, actual occupancy may vary due to factors such as increased parking
demand in that area and decreased demand at other garages. Should occupancy or demand for the new
garage differ significantly from projections, staff will adjust budgets accordingly through future financial
planning cycles.
Planned upcoming Capital Improvement Plan Projects this fiscal year include garage security updates to
Actuals Budget Supplement
Parking Fund FY 2024-25 FY 2025-26 FY 2026-27
Staffing 2,109,475$ 2,199,851$ 2,552,926$
YoY Change 6%4%16%
Other Operating Expenditures 1,707,291 1,750,531 1,837,748
YoY Change -7%3%5%
Transfers 1,632,053 1,720,732 1,788,802
YoY Change 18%5%4%
Capital Expenditures 27,151,937 2,146,465 527,292
YoY Change 31%-92%-75%
Debt Service Costs 3,492,373 3,696,534 3,593,491
YoY Change 16%6%-3%
Total Expenditures 36,093,130$ 11,514,112$ 10,300,258$
YoY Change 25%-68%-11%
119 Page 385 of 454
Department Summary Public Works
install perimeter fencing around the top levels and security cameras throughout the garages and the
purchase of additional pay stations to remove the existing single‐space parking meters. Overall, projected
unreserved working capital remains healthy in the outer years of the forecast, which will be available to
support capital needs in the future.
With the completion of the CADPS in FY 2025‐26, Unreserved Year‐End Working Capital returns to standard
levels, as compared with the FY 2024‐25 Unreserved Year‐End Working Capital balance, which reflects the
one‐time influx of $47 million in debt proceeds in FY 2023‐24 received for this project.
The Long‐Term Forecast table below includes the previously referenced SOBCs.
120 Page 386 of 454
Department Summary Public Works
Transit Fund
The Transit program received two (2) additional battery electric buses in April 2026. Once these buses are
in service in the fall of 2026, almost 60% of SLO Transit’s fleet will be zero‐emission, which places the City
well ahead of the state’s zero‐emission mandates. Expansion of charging infrastructure at the Transit Yard
is currently underway and, once completed, will support the operation of SLO Transit’s zero‐emission fleet
vehicles. A new contract for transit operation and maintenance services goes into effect on July 1, 2026.
The scope of services includes implementation of the following Short‐Range Transit Plan (SRTP)
recommendations: additional trips on Routes 4A/B, and operation of “B” Routes on weekends. The
remaining SRTP recommendations will be implemented later in the upcoming contract term, subject to
the availability of funding, vehicles, and staffing. Ridership has increased by an average of 12% each year
for the past four years. As SLO Transit service levels have returned to pre‐pandemic operations, and if this
growth trend continues, overall ridership is projected to return to pre‐pandemic levels in a little over two
years.
Changes from Financial Plan
Staff is requesting two SOBCs as a result of the Transit Program’s new operator contract and rising fuel
costs:
1. Purchased Transportation – New Contract Estimated Costs ($82,830). This addition reflects the
estimated additional cost of the bus operator contract, which was approved by Council in April 2026.
2. Fuel ($175,782). Staff have reallocated net savings to mitigate this increased fuel costs anticipated
in FY 2026‐27. This amount of $175,782 reflect the additional budget staff expects to need.
Fiscal Analysis – Revenue
Transit Fund revenues are forecasted to increase by 20% in FY 2026‐27, in alignment with anticipated
revised expenditures. Transit Fund charges for service revenues are proposed to increase year over year
Actuals Financial Plan
Transit Fund FY 2024-25 FY 2025-26 FY 2026-27
Bus Fares 234,855$ 260,000$ 285,200$
YoY Change -6%11%10%
Cal Poly Transit 750,000 750,000 750,000
YoY Change 0%0%0%
Federal Grants 8,859,273 8,254,281 8,891,277
YoY Change 154%-7%8%
State Grants 1,360,509 2,733,722 4,505,787
YoY Change -15%101%65%
Other 998,813 30,455 30,807
YoY Change 163%-97%1%
Total Revenue 12,203,451$ 12,028,459$ 14,463,072$
YoY Change 88%-1%20%
121 Page 387 of 454
Department Summary Public Works
by about $20,000 or 2% as total passenger trips continue to increase year over year post‐pandemic. In
April 2024, Council approved a new three‐year agreement with Cal Poly for transit services at the same
annual amount of $750,000, which is reflected in the budget.
Fiscal Analysis – Expenditures
No budget reductions were made to the Transit Fund’s Financial Plan baseline as part of the Council’s
recommendations in March. Staffing expenditures are forecasted to increase 21% in FY 2026‐27 due to
the negotiated cost of living adjustments and other staffing changes that took effect in FY 2025‐26, which
were not factored into the staffing budget. As a result, the FY 2026‐27 budget reflects two years of
increases. Transit Fund operating expenditures are proposed to increase by 23% in FY 2026‐27 primarily
due to anticipated and sustained increases in fuel costs driven by changes in the global oil supply and the
additional costs of the new operator contract. The Transit Program was able to re‐allocate existing funding
within the constrained base budget to offset all other identified increases, including inflationary
adjustments, utility increases, and replacement of major vehicle components. Capital expenditures in FY
2026‐27 are primarily driven by the planned purchase of three (3) new EV buses (replacing diesel buses
that are beyond their useful life) and the procurement and installation of charging infrastructure to
support them. The Transit Program is funded through a combination of federal, state, and local sources
which will be used to cover the increase in operating expenditures.
The future of federal transit funding is uncertain due to the expiration of the Infrastructure and
Investment Jobs Act (IIJA) this fiscal year which provided a substantial, multi‐year investment in the
nation’s infrastructure and transportation as well as evolving restrictions on the use of competitive federal
funds for low‐ and no‐emission capital purchases. The Transit Fund is reliant upon both formula and
competitive federal funds to cover operating and capital expenses. If future federal funding availability is
significantly reduced, then the Fund would utilize Transportation Development Act fund reserves
allocated to the City in prior fiscal years to cover immediate expenses. Depending on the severity of the
funding shortfall, staff would present to Council for consideration capital project deferments and possibly
Actuals Budget Supplement
Transit Fund FY 2024-25 FY 2025-26 FY 2026-27
Staffing 393,432$ 387,257$ 468,159$
YoY Change 1%-2%21%
Other Operating Expenditures 4,992,796 5,604,933 6,901,921
YoY Change 24%12%23%
Transfers 460,609 467,804 391,973
YoY Change -1%2%-16%
Capital Expenditures 6,324,995 3,155,719 6,699,292
YoY Change 279%-50%112%
Total Expenditures 12,171,832$ 9,615,713$ 14,461,345$
YoY Change 86%-21%50%
122 Page 388 of 454
Department Summary Public Works
operating budget reductions to maximize use of reserves until new and sustained funding sources can be
identified and secured.
Objective: Encourage sustainable transportation
Strategic Goal: Implement sustainable transportation objectives from the Short‐Range Transit Plan and the Active
Transportation Plan including frequency and service of transit, as well as trail, pedestrian, and bicycle
improvements and street enhancements to uphold traffic safety.
2025-26
Target
2025-26
Projected
Actual
2026-27
Target
Measure: Annual SLO Transit Ridership 663,900 717,200 734,182
FY 2025‐26 and FY 2026‐27 targets are based on the Short‐Range Transit Plan projections. Staff continues
to see ridership steadily increase. All fixed route services have been restored as of January 2026, and
student ridership continues to drive this trend.
123 Page 389 of 454
Department Summary Public Works
Transit Fund Long‐Term Forecast
124 Page 390 of 454
Department Summary Public Works
The Transit Fund is able to cover all current and forecasted operating and capital costs with support from
Federal and State funding sources. Operating costs are projected to steadily increase over the next few
years primarily due to anticipated increases in the costs of contracted services and supplies. If significant
changes occur in the reliability of State or Federal funding sources, deferral of planned service expansions
and possible reductions in existing services may be required. Staff will continue to submit reimbursements
for existing, awarded grants and will continue to apply for new grants to fund future operating costs and
capital projects. The Long‐Term Forecast above includes expenses for the proposed SOBCs.
125 Page 391 of 454
Department Summary Utilities
Public Works and Utilities (Utilities Branch)
Department Summary
On November 18, 2025, City Council approved the consolidation of the individual Public Works and
Utilities Departments, creating a single Public Works and Utilities Department. As this merger occurred
partway through a fiscal year, and many aspects of these departments are not yet fully joined, this
document will separately represent the budgetary aspects of the Public Works Branch and the Utilities
Branch of the department.
The Utilities Branch oversees two Enterprise Funds (Water and Sewer), an Agency Fund (Whale Rock), and
the Stormwater and Solid Waste and Recycling programs which are held in the General Fund. The Solid
Waste and Recycling budget is funded by AB 939, which are restricted to waste diversion activities. In
addition to the Water and Sewer Funds, the Utilities Branch also manages the Whale Rock Fund, which is
overseen by the Whale Rock Commission (with representatives for the City of San Luis Obispo, Cal Poly,
and California Men’s Colony). The City’s share of operational expenses and capital project contributions
for Whale Rock operations are budgeted through the Water Fund’s Source of Supply budget.
Utilities Branch Programs
Fund Fund Type Programs Funded Notes
Water
Fund
Enterprise
Fund
Administration and Engineering
Source of Supply
Water Treatment
Water Distribution
Water Resources
Utility Billing
The City’s water operations are paid for by
water service rate revenues and cover all
costs for operations, maintenance,
infrastructure replacement, and debt
service. Taxes, including utility user taxes,
do not support these services.
Sewer
Fund
Enterprise
Fund
Administration and Engineering
Wastewater Collection
Environmental Programs
Water Resource Recovery
Water Quality Lab
Utility Billing
The City’s sewer operations are paid for by
sewer service rate revenues and cover all
costs for operations, maintenance,
infrastructure replacement, and debt
service. Taxes, including utility user taxes,
do not support these services.
Whale
Rock Fund Agency Fund Reservoir Operations The Whale Rock Fund is overseen by the
Whale Rock Commission.
General
Fund
General
Fund
Solid Waste and Recycling
Stormwater
The Solid Waste program is paid for by AB
939 and Franchise fee funding. AB 939
funds may only be used to pay for activities
that divert waste from landfills. The
Stormwater program manages compliance
with federal and state stormwater
regulations through inspections,
permitting, and enforcement.
The following sections review changes from the 2025-27 Financial Plan, performance measures, and
summarized financial positions by fund.
126 Page 392 of 454
Department Summary Utilities
Changes from Financial Plan
Staff are recommending six changes from the 2025-27 Financial Plan. Three of these changes are tied to
pass-through cost increases for existing goods and services. Two changes are tied to staffing requirements
resulting from staff turnover and regulatory requirements. The remaining change is related to strategic
expenditure reductions brought to Council on March 3, 2026 (Item 6b). These are summarized in the table
below.
Changes from Financial Plan
Short Description Justification Amount
Stormwater Software Licensing and
Office Supplies. These budgets have
historically funded resources that
facilitate staff management of
stormwater assets.
General Fund Expenditure Reduction.
This matches the strategic budget
reductions brought to Council on March
3, 2026 (Item 6b).
($6,500)
Biosolids Hauling Contract. Biosolids
hauling is the process of transporting
treated wastewater solids (biosolids)
from the Water Resource Recovery
Facility (WRRF) to off-site locations
for disposal, beneficial reuse, or
further treatment.
Pass-through Expense. On December 2,
2025 (Item 5g), Council authorized staff
to advertise the RFP for biosolids hauling
at the WRRF. The lowest qualified
proposer submitted a 21% increase on
current rates, plus relevant fuel
surcharges.
$150,000
AMI Cellular Service. Monthly service
enabling automated, remote
transmission of water meter data.
Pass-through Expense. In August 2025,
staff secured heavily discounted AMI
meters and radios, avoiding
approximately $922,000 in one-time
costs. As a condition of this purchase,
the City began paying cellular service in
advance of installation. As meters are
deployed, these costs are partially offset
by a reduction in monthly charges of
$0.50 per meter due to reduced manual
reading expenses.
$85,000
Source of Supply Revisions. Funding
for the City’s share of operations,
capital improvements, and debt
service associated with the Salinas,
Nacimiento, and Whale Rock
Reservoirs.
Pass-through Expense. While the City
adopts a two-year financial plan, partner
reservoir budgets are approved annually
and may change based on operational
and regulatory needs. As a result,
second-year cost estimates are subject
to adjustment. The current increase is
primarily driven by required capital
improvements to maintain dam safety
compliance under the California Division
of Safety of Dams at the Whale Rock
Reservoir.
$612,769
Contract T5 Operator. The City’s Regulatory Compliance. DDW requires $215,000
127 Page 393 of 454
Department Summary Utilities
Short Description Justification Amount
Water Treatment Plant (WTP) is
regulated by the California State
Water Resources Control Board,
Division of Drinking Water (DDW),
and is classified as a Treatment Grade
5 (T5) facility, which is the highest
level of treatment complexity
recognized by the State. The only T5
Operator that the City employs has
stated their intent to resign from their
position, requiring backfill of this
position by a contract operator until
the recruitment process concludes in
a hire for the permanent position.
that a T5 Operator be continuously
available to support operations, direct
process control decisions, and ensure
compliance with regulatory
requirements. Due to the criticality of
this service, staff have already received
City Manager authorization to proceed
with this contract through San Luis
Obispo Municipal Code 3.24.060, which
allows for the dispensation of purchasing
requirements when reasonably
necessary for health and safety. This
budget request includes T5 Operator
coverage of the WTP through October
31, 2026, to allow staff sufficient time to
recruit a permanent replacement for the
vacated position while remaining in
compliance with DDW requirements.
Addition of a Utilities Special Projects
Manager to complete capital
projects. And reduction of FTE for the
Public Works and Utilities
Department merger.
Regulatory Compliance and Department
Structural Change. An additional Utilities
Special Projects Manager position is
requested to strengthen the Branch’s
capacity to manage and deliver capital
and special projects, conduct
development review of increasingly
complex entitlements, while meeting
increasing regulatory reporting
requirements. Recent turnover in key
management and supervisorial positions
within the Utilities Branch has further
underscored the need for dedicated
project and program support to ensure
operational focus on the Branch’s key
mission to deliver essential water and
wastewater services, maintain
continuity, meet compliance obligations,
and reduce delivery risk.
The estimated fiscal impact for a Special
Projects Manager is $162,000. And
when combined with the approved
consolidation of the Public Works and
Utilities Departments (Item 6f,
November 18, 2025), this results in an
estimated cost of $266,000. This
$266,000 amount includes the actual
$0
128 Page 394 of 454
Department Summary Utilities
Short Description Justification Amount
updated fiscal impacts from the
reduction of a management position
associated with the Public Works and
Utilities Department merger (elimination
of the vacant Financial Analyst position
in Utilities). To minimize the fiscal impact
associated with this SOBC, the Utilities
Branch has identified full offsetting non-
personnel expenditure reductions
through operational efficiencies.
Notable examples of these operational
expenditure reductions include a
$131,000 reduction in electricity costs,
driven by infrastructure improvements
and operational changes that optimize
peak demand and time-of-use rates, and
a $62,000 reduction in advertising and
outreach costs that align with Utilities
increased use of less costly digital media
and in-house services (there are no
anticipated impacts on the ability of the
Utilities branch to carry out educational
and engagement activities). The
remaining $73,000 came from a variety
of smaller expenditure reductions.
Performance Measures
Objective: Maintain and manage infrastructure, assets, and facilities responsibly and transparently.
Strategic Goal: Public Stewardship
2025-26
Target
2025-26
Projected
2026-27
Target
Measure: Sanitary Sewer Overflows per 100 miles of publicly-owned sewer main 0 6.08 0
Measure: Breaks/leaks per 100 miles of water main <13.4 6.81 <13.4
Sanitary Sewer Overflows (SSOs) per 100 miles of publicly-owned sewer main exceed the 2025-26 target
due to aged infrastructure with conditions that are exacerbated by climate change (drought-related root
intrusion) and consumer habits tied to restaurant activity (use and disposal of fats, oils, and grease). While
the target remains zero, staff are optimistic that ongoing success of the City’s private sewer lateral
programs, pretreatment program, and expansion of remote monitoring systems will continue the trend
of reducing SSOs that will maintain this Key Performance Indicator (KPI) near zero.
Breaks/leaks per 100 miles of water main remain on track with internal metrics and industry standards.
129 Page 395 of 454
Department Summary Utilities
Objective: Provide the Community with High Quality and Reliable Service
Strategic Goal: Public Service
2025-26
Target
2025-26
Projected
2026-27
Target
Measure: Recycled Water Delivered in acre-feet (AF) 375 271 395
Measure: Number of customers who have set up an online profile to view their
real-time water usage 1,000 850 1,600
Recycled Water Delivered (AF) is primarily driven by customer irrigation demand and expansion of the
existing recycled water system for new development. Recent recycled water demand illustrates this
variability:
CY 2022: 291 AF
CY 2023: 274 AF
CY 2024: 353 AF
CY 2025: 261 AF
Recycled water delivery will remain inherently variable due to weather patterns, customer demand
characteristics, and development activity.
The number of customers who have set up online profiles to view real-time water usage is trending below
the FY 2025–26 target due to the promotion of three Water Meter and Radio Installation Technicians into
new roles within the City. These promotions have helped fill critical vacancies in the Water Distribution
and Reservoir Operations programs, supporting service continuity, but have temporarily reduced capacity
for advanced metering infrastructure (AMI) deployment previously implemented by these Technicians.
As of April 14, 2026, 5,317 AMI meters have been installed, with 795 active customer accounts. This
represents an approximate 15% adoption rate of EyeOnWater, the City’s water monitoring application.
Adoption is expected to increase as installation capacity is restored and customer outreach continues.
Objective: Enhance Accessibility and Equity in Services
Strategic Goal: Public Service
2025-26
Target
2025-26
Projected
2026-27
Target
Measure: Minimize Customer Shut-Offs for Non-payment <400 444 <400
Measure: Number of water/sewer customers enrolled in the customer
assistance program (low-income program) 465 282 500
The number of customer shut-offs for non-payment is currently at 333 through March 31, 2026. On
average there have been 37 shutoffs for non-payment per month. The process for notification before
shutoff includes an insert with the bill prior to shutoff, two phone trees, a courtesy email after the first
phone tree, and a door tag if the first phone tree failed to achieve contact. Customers are afforded one
payment plan or extension in a year.
The number of water and sewer customers enrolled in the Customer Assistance Program is trending below
the FY 2025–26 target, but has increased substantially in recent years. Enrollment by fiscal year is as
follows:
130 Page 396 of 454
Department Summary Utilities
FY 2021-22 Actual: 173
FY 2022-23 Actual: 163
FY 2023-24 Actual: 179
FY 2024-25 Actual: 216
FY 2025-26 Forecasted: 282
This reflects a 63% increase over five years. The increase was largely facilitated by Council adoption of
Resolution No. 11552 (March 18, 2025), which established the 2025 Integrated Solid Waste Rates and by
extension a customer assistance program for those customers. The establishment of the solid waste
customer assistance program allowed staff to streamline outreach efforts across both assistance
programs.
General Fund
Fund Summary
The Utilities Branch of the Public Works and Utilities Department manages Solid Waste and Recycling and
Stormwater programs, which are both General Funded.
The Solid Waste and Recycling Program budget is supported by AB 939 (Solid waste management, source
reduction, recycling, composting, and market development). The Program plans, implements, and
oversees waste reduction, recycling, and organics initiatives to meet local and state regulatory
requirements and diversion goals. Key functions include contract administration with the solid waste
franchisee, rate and fee oversight, compliance monitoring and enforcement, and required reporting to
regulatory agencies. The Program also emphasizes public education and outreach, infrastructure
planning, and coordination with regional partners to support long-term sustainability and zero waste
objectives.
The Stormwater Program is primarily driven by federal and state regulatory requirements, including the
Municipal Separate Storm Sewer System (MS4) permit, Construction General Permits, and Industrial
General Permits. The Program develops, implements, and oversees activities to protect water quality
through compliance monitoring, inspection and enforcement, and required regulatory reporting. Key
functions include coordination with City departments and external agencies, administration of contracts
and projects, and development of policies and procedures to meet evolving regulatory standards. The
Program also emphasizes public education, pollution prevention, and long-term planning to support
environmental protection and regulatory compliance.
Departmental Budget – General Fund
Actuals Budget Supplement
Utilities FY 2024-25 FY 2025-26 FY 2026-27
Staffing 1,171,743$ 1,182,122$ 1,334,763
YoY Change -2%1%13%
Other Operating Expenditures 363,061 199,541 191,590
YoY Change -20%-45%-4%
Total 1,534,804$ 1,381,663$ 1,526,353$
YoY Change -7%-10%10%
131 Page 397 of 454
Department Summary Utilities
Staffing note: Development of the 2025-27 Financial Plan occurred in conjunction with labor negotiations
with San Luis Obispo City Employees’ Association and the unrepresented bargaining groups. Contingencies
for negotiated cost of living and benefits adjustments were included in a non-departmental cost center in
FY 2025-26, leading to artificially high departmental staffing budget increases in FY 2026-27.
Changes from Financial Plan
The Staffing budget increased by $153,000 because the 2025-27 Financial Plan was developed before
Resolution No. 11579, Resolution No. 11580, and Resolution No. 11581were approved. These resolutions
established the Memoranda of Understanding between the San Luis Obispo City Employees’ Association,
Unrepresented Management, and Confidential Employees.
The operating budget decreased by $6,500, consistent with the strategic budget reductions brought to
Council on March 3, 2026 (Item 6b). These reductions reflect reductions in software licensing and office
supplies, which have historically funded resources that facilitate staff management of stormwater assets.
Water Fund
Fund Summary
The Water Fund supports six programs. These are described in more detail below.
Administration and Engineering
Supports overall management, planning, engineering, and administrative functions necessary to operate
and maintain the City’s water system, including capital project delivery and regulatory coordination.
Source of Supply
Funds the City’s pass-through costs for raw water supplies from the Salinas, Nacimiento, and Whale Rock
Reservoirs, including associated operations, capital, and debt obligations.
Water Treatment
Funds the operation, maintenance, and regulatory compliance of the City’s water treatment facilities to
ensure safe and reliable drinking water.
Water Distribution
Supports the operation, maintenance, and repair of the City’s water distribution system, including
pipelines, valves, hydrants, and storage facilities.
Water Resources
Funds long-range water supply planning, conservation programs, groundwater and surface water
management, and regulatory compliance efforts related to water resources.
Utility Billing
Supports meter reading, billing, customer service, and revenue collection activities necessary to
administer water utility services.
132 Page 398 of 454
Department Summary Utilities
Changes from Financial Plan
Fiscal Analysis - Revenue
Increases in budgeted Water Sales and Base Charges are consistent with Council-approved rate
adjustments adopted under Resolution No. 11582. The decrease in budgeted Other Revenue reflects the
timing of Proposition 1B grant reimbursements supporting the City’s Groundwater Cleanup Project. Based
on the current project schedule, grant disbursements are anticipated to be lower than budgeted in FY
2025–26 and higher than budgeted in FY 2026–27. These timing differences do not affect the overall
funding expected for the project.
Water Fund FY 2024-25 FY 2025-26 FY 2026-27
Water Sales 21,379,368$ 21,449,631$ 22,740,826$
YoY Change 12%0%6%
Base Charges 7,650,544 8,448,140 8,984,090
YoY Change 9%10%6%
Setup Fees 125,561 160,000 160,000
YoY Change -35%27%0%
Other Revenue 6,972,868 4,351,680 293,606
YoY Change 144%-38%-93%
Total Revenue 36,128,340$ 34,409,452$ 32,178,522$
YoY Change 24%-5%-6%
133 Page 399 of 454
Department Summary Utilities
Fiscal Analysis – Expenditures
The Staffing budget increased by $440,000 because 1) the 2025-27 Financial Plan was developed before
Resolution No. 11579, Resolution No. 11580, and Resolution No. 11581were approved and 2) the costs
associated with one staffing request by the Utilities Branch. These resolutions established the Memoranda
of Understanding between the San Luis Obispo City Employees’ Association, Unrepresented Management,
and Confidential Employees. The one staffing request is an additional Utilities Special Projects Manager
to support capital project delivery, regulatory reporting, and strategic program initiatives. The Utilities
Branch is also reducing one management position consistent with Item 6f on November 18, 2025, which
consolidated and restructured the Public Works and Utilities Departments. These staffing changes will be
funded primarily through operational efficiencies resulting in expenditure reductions and will be a shared
expense between the Water and Sewer Funds.
The $2.9 million reduction in Other Operating Expenditures in FY 2026–27 reflects the timing of the City’s
one-time contribution toward capital improvements at the Salinas Reservoir. These costs are incurred in
the prior fiscal year and do not continue into FY 2026–27.
Long Term Forecast
The Water Fund is projected to remain in a stable financial position over the forecast period, with
revenues and expenditures generally aligned to support ongoing operations and capital needs. Minor
year-to-year fluctuations are expected and reflect the timing of planned activities rather than structural
imbalances. Notably, the increase in Other Revenue in FY 2027–28 is associated with an anticipated debt-
financed capital project and does not represent ongoing revenue. Additionally, the decrease in operating
expenditures in FY 2026–27 is primarily attributable to upfront contributions made in the prior year for
dam safety improvements at the Salinas Reservoir. These timing-related adjustments are incorporated
into the forecast and do not materially impact long-term fund stability. Overall, the Water Fund is
expected to maintain adequate reserves and continue to meet operational and capital obligations. The
long-term financial forecast is provided in the table below.
Actuals Budget Supplement
Water Fund FY 2024-25 FY 2025-26 FY 2026-27
Staffing 5,495,997$ 6,214,757$ 6,654,708$
YoY Change 1%13%7%
Other Operating Expenditures 15,015,367 20,859,920 17,913,253
YoY Change 18%39% -14%
Transfers 2,947,417 2,819,038 2,416,517
YoY Change 1%-4% -14%
Capital Expenditures 8,858,790 8,265,632 5,770,043
YoY Change 8%-7% -30%
Debt Service Costs 1,762,421 1,865,911 1,855,405
YoY Change 0%6%-1%
Total Expenditures 34,079,992$ 40,025,258$ 34,609,926$
YoY Change 10%17% -14%
134 Page 400 of 454
Department Summary Utilities
Water Fund Long-Term Forecast
(A)
Actual
2024-25
(B)
Financial Plan
2025-26
(C)
Budgeted
2026-27
(D)
Projected
2027-28
(E)
Projected
2028-29
REVENUE
Total Charges for Service 29,155,473$ 30,057,771$ 31,884,916$ 33,854,643$ 35,540,062$
Total Other Revenue 9,203,258$ 5,151,680$ 1,093,606$ 10,031,000$ 1,031,000$
Total Revenue1 38,358,730$ 35,209,451$ 32,978,522$ 43,885,643$ 36,571,062$
EXPENDITURES
Total Salaries and Benefits2 5,495,997$ 6,214,757$ 6,654,708$ 6,948,314$ 7,156,764$
Total Other Operating Expenditures 15,015,367$ 20,859,920$ 17,913,253$ 18,327,809$ 16,714,877$
Total General Government 2,947,417$ 2,819,038$ 2,416,517$ 2,503,705$ 2,594,243$
Total Debt Service 1,762,421$ 1,865,911$ 1,855,405$ 1,854,858$ 2,438,386$
Total Operating Expenditures 25,221,202$ 31,759,625$ 28,839,883$ 29,634,685$ 28,904,269$
Total Captial Asset Expenditures3 8,858,790$ 28,671,724$ 5,770,043$ 11,517,430$ 5,970,520$
Total Expenditures 34,079,991$ 60,431,349$ 34,609,926$ 41,152,115$ 34,874,788$
Working Capital - Beginning 43,032,553$ 47,311,292$ 22,089,394$ 20,457,990$ 23,191,518$
Change in Financial Position 4,278,739$ (25,221,898)$ (1,631,404)$ 2,733,528$ 1,696,274$
Working Capital - Year End 47,311,292$ 22,089,394$ 20,457,990$ 23,191,518$ 24,887,791$
Rate Stabilization Reserves (10%)2,878,167$ 2,973,092$ 3,154,813$ 3,350,833$ 3,518,374$
Operating Reserve (20%)5,044,240$ 6,351,925$ 5,767,977$ 5,926,937$ 5,780,854$
Other Reserves (i.e. Debt Reserves)175,656$ 175,656$ 175,656$ 175,656$ 175,656$
Unreserved Working Capital Year End 39,213,229$ 12,588,721$ 11,359,545$ 13,738,092$ 15,412,907$
2025-27 Financial Plan
1. This line reflects impact fees accounted for outside the Water Fund but incorporated into overall financial position.
2. This line includes actual, budgeted, and forecasted CalPERS ADP.
3. Fiscal Year 2025–26 includes carryover capital projects. Expenditures may occur in different years than originally budgeted.
135 Page 401 of 454
Department Summary Utilities
Sewer Fund
Fund Summary
The Sewer Fund supports six programs. These are described in more detail below.
Administration and Engineering
Supports overall management, planning, engineering, and administrative functions necessary to operate
and maintain the City’s wastewater system, including capital project delivery and regulatory coordination.
Wastewater Collection
Funds the operation, maintenance, and repair of the City’s sewer collection system, including pipelines,
pump stations, and related infrastructure.
Environmental Programs
Supports regulatory compliance programs, including industrial pretreatment and environmental
monitoring to protect public health and water quality, and the City’s wastewater collection system and
Water Resource Recovery Facility.
Water Resource Recovery
Funds the operation, maintenance, and regulatory compliance of the Water Resource Recovery Facility
(WRRF), including wastewater treatment, biosolids handling, and recycled water production.
Water Quality Lab
Supports laboratory testing and analysis required to monitor water and wastewater treatment
performance and ensure compliance with state and federal regulations.
Utility Billing
Supports meter reading, billing, customer service, and revenue collection activities necessary to
administer wastewater utility services.
Fiscal Analysis - Revenue
Actuals Budget Supplement
Sewer Fund FY 2024-25 FY 2025-26 FY 2026-27
Service Charges 13,870,802$ 14,836,162$ 15,887,765$
YoY Change 5%7%7%
Base Charges 5,850,432 6,244,610 6,703,713
YoY Change 6%7%7%
Other Revenue 3,989,601 321,000 321,000
YoY Change 8%-92%0%
Total Revenue 25,023,194$ 21,768,825$ 23,320,050$
YoY Change 5%-13%7%
136 Page 402 of 454
Department Summary Utilities
Increases in budgeted Service Charges and Base Charges are consistent with Council-approved rate
adjustments adopted under Resolution No. 11584. These adjustments reflect previously authorized rate
changes and are incorporated into the forecast accordingly. No additional rate modifications are assumed
beyond those approved by Council.
Fiscal Analysis – Expenditures
The Staffing budget increased by $514,000 because 1) 2025-27 Financial Plan was developed before
Resolution No. 11579, Resolution No. 11580, and Resolution No. 11581were approved and 2) the costs
associated with one staffing request by the Utilities Branch. These resolutions established the Memoranda
of Understanding between the San Luis Obispo City Employees’ Association, Unrepresented Management,
and Confidential Employees. The one staffing request is an additional Utilities Special Projects Manager
to support capital project delivery, regulatory reporting, and strategic program initiatives. The Utilities
Branch is also reducing one management position consistent with Item 6f on November 18, 2025, which
consolidated and restructured the Public Works and Utilities Departments. These staffing changes will be
funded primarily through operational efficiencies resulting in expenditure reductions and will be a shared
expense between the Water and Sewer Funds.
The approximately $136,000 decrease in Other Operating Expenditures reflects targeted reductions to
offset the cost of a requested staffing addition and maintain a net-zero fiscal impact. These reductions
were achieved through operational efficiencies and adjustments to non-personnel budgets. The changes
are not expected to impact core service delivery and align with the Utilities Branch’s broader cost
management strategy.
Long Term Forecast
The Sewer Fund is projected to remain in a strong and stable financial position throughout the forecast
period, with sufficient revenues to support both operational and capital requirements. Variations across
years are primarily driven by the timing of expenditures and capital activities rather than underlying
financial constraints. The elevated balance in Other Reserves reflects requirements associated with the
Actuals Budget Supplement
Sewer Fund FY 2024-25 FY 2025-26 FY 2026-27
Staffing 5,552,235$ 6,015,856$ 6,529,646$
YoY Change 2%8%9%
Other Operating Expenditures 3,905,154 4,746,764 4,610,285
YoY Change -1%22%-3%
Transfers 3,290,250 3,140,155 2,909,332
YoY Change 6%-5%-7%
Capital Expenditures 14,028,786 8,033,141 7,030,377
YoY Change -30% -43% -12%
Debt Service Costs 6,825,920 7,098,607 7,090,097
YoY Change 11%4%0%
Total Expenditures 33,602,345$ 29,034,524$ 28,169,737$
YoY Change -13% -14%-3%
137 Page 403 of 454
Department Summary Utilities
State Revolving Fund loan for the Water Resource Recovery Facility upgrade, and these funds are
restricted for that purpose. This reserve structure strengthens the fund’s financial position but is not
indicative of discretionary available resources. Overall, the Sewer Fund is well-positioned to meet its
financial obligations while maintaining compliance with funding requirements and reserve policies. The
long-term financial forecast is provided in the table below.
Sewer Fund Long-Term Forecast
(A)
Actual
2024-25
(B)
Financial Plan
2025-26
(C)
Budgeted
2026-27
(D)
Projected
2027-28
(E)
Projected
2028-29
REVENUE
Total Charges for Service 21,034,861$ 21,080,772$ 22,591,478$ 24,158,770$ 25,658,369$
Total Other Revenue 26,256,332$ 921,000$ 921,000$ 921,000$ 921,000$
Total Revenue1 47,291,192$ 22,001,772$ 23,512,478$ 25,079,770$ 26,579,369$
EXPENDITURES
Total Salaries and Benefits2 5,552,235$ 6,015,856$ 6,529,646$ 6,827,797$ 7,032,630$
Total Other Operating Expenditures 3,905,154$ 4,746,764$ 4,610,285$ 4,764,190$ 4,911,489$
Total General Government 3,290,250$ 3,140,155$ 2,909,332$ 3,017,706$ 3,130,386$
Total Debt Service 6,825,920$ 7,098,607$ 7,090,097$ 7,427,320$ 7,256,372$
Total Operating Expenditures 19,573,558$ 21,001,383$ 21,139,360$ 22,037,012$ 22,330,878$
Total Captial Asset Expenditures3 14,028,786$ 31,395,661$ 7,030,377$ 4,192,524$ 4,566,041$
Total Expenditures 33,602,345$ 52,397,044$ 28,169,737$ 26,229,536$ 26,896,919$
Working Capital - Beginning 53,797,920$ 67,486,768$ 37,091,496$ 32,434,237$ 31,284,471$
Change in Financial Position 13,688,848$ (30,395,272)$ (4,657,259)$ (1,149,766)$ (317,551)$
Working Capital - Year End 67,486,768$ 37,091,496$ 32,434,237$ 31,284,471$ 30,966,921$
Rate Stabilization Reserves (10%)1,021,760$ 1,032,962$ 1,108,497$ 1,181,312$ 1,256,292$
Operating Reserve (20%)3,914,712$ 4,200,277$ 4,227,872$ 4,407,402$ 4,466,176$
Other Reserves (i.e. Debt Reserves)6,087,166$ 6,087,166$ 6,087,166$ 6,087,166$ 6,087,166$
Unreserved Working Capital Year End 56,463,130$ 25,771,092$ 21,010,702$ 19,608,591$ 19,157,287$
2025-27 Financial Plan
1. This line reflects impact fees accounted for outside the Sewer Fund but incorporated into overall financial position.
2. This line includes actual, budgeted, and forecasted CalPERS ADP.
3. Fiscal Year 2025–26 includes carryover capital projects. Expenditures may occur in different years than originally budgeted.
138 Page 404 of 454
Appropriation Limit
11.Appropriation Limit
The City’s appropriation limit is based on the Gann Spending Limit Initiative, a State constitutional
amendment adopted by the voters on June 6, 1979, and amended in 1990 with Proposition 111. It is
anchored in the State Constitution under Article XIIIB.
The limit restricts appropriations from tax revenues by State and local governments. Under its provisions,
no local agency can appropriate proceeds of taxes in excess of its “appropriation limit”. Excess funds may
be carried over into the next year. However, any excess funds remaining after the second year must be
returned to taxpayers by reducing tax rates of fees; a majority of the voters may approve an override to
increase the limit.
The City’s appropriation limit is calculated by considering population growth and cost of living as allowed
under Proposition 111. The limit applies generally to tax funded spending and allows exceptions for debt
service major capital expenditures. These exceptions allow the City to fund large capital projects with debt
financing and to ensure that fee or grant funded programs are not inhibited.
11.1 Appropriation Limit Calculation
The following summarizes changes in the City’s appropriation limit and appropriations subject to the limit
for the past ten years as well as the appropriation limit for 2026-27. A positive variance indicates that the
City’s appropriations are lower than the allowable limit.
11.2 Limits over time
Factors Ratio
A.) Prior Year Appropriation Limit $102,632,964
B.) Adjustment Factors
1.Population Change 1.01%1.0063
2. Cost of Living Increase 1.05%1.0495
3. Combined Factor 1.06%1.0562
Adjusted Limit $108,396,106
Fiscal Year Limit Base
Cost of Living
Factor
Population
Factor
Appropriation
Limit
Appropriations
Subject to Limit Variance
2017-18 66,451,500 1.20% 0.92% 67,867,633 50,036,391 17,831,242
2018-19 67,867,633 1.88% 0.35% 69,383,546 51,142,315 18,241,231
2019-20 69,383,546 6.37% 0.24% 73,981,290 50,127,692 23,853,598
2020-21 73,981,290 1.92% -0.04% 75,373,410 48,342,410 27,031,416
2021-22 75,373,410 5.11% 0.31% 79,470,558 52,362,031 27,108,458
2022-23 79,470,558 7.55% 0.28% 85,706,220 65,610,162 20,093,058
2023-24 85,706,220 4.79% 1.15% 90,839,932 71,693,192 19,146,740
2024-25 90,839,932 3.62% 0.90% 94,976,973 76,671,495 18,305,478
2025-26 94,976,973 6.44% 1.52% 102,632,964 91,034,718 11,598,246
2026-27 102,632,964 4.95% 0.63% 108,396,106 99,530,182 8,865,924
139 Page 405 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
1001-City Administration 1,785,030$
51001-Salaries - Regular 1,089,397
51004-Salaries - Temporary 8,400
52001-Retirement Contributions 74,168
52002-Retirement PARS - 401 11,921
52003-PERS Unfunded Liability 248,681
53001-Employee Group Insurance 123,893
53002-Retiree Healthcare 13,496
55001-Medicare 15,460
56003-Contingency Expense 9,550
61001-Advertising and Public Outreach 6,000
61008-Parking 7,680
61013-Other Contract Services 112,500
62001-Print and Reproduction 200
62002-Office Supplies 3,500
62003-Postage 200
62004-Publications and Subscriptions 325
62009-Software Licensing and Maint Agreements 29,558
63001-Membership and Certifications 2,400
63002-Education and Training 13,800
63003-Trips and Meetings 13,900
1002-City Council 270,881
51002-Council and Commissioners 169,098
52001-Retirement Contributions 5,960
52003-PERS Unfunded Liability 20,022
53001-Employee Group Insurance 34,763
53002-Retiree Healthcare 1,087
55001-Medicare 2,452
62001-Print and Reproduction 400
62010-Office Expenses - Other 17,400
63002-Education and Training 15,100
63003-Trips and Meetings 4,600
140 Page 406 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
1004-Economic Development 791,625
51001-Salaries - Regular 174,528
52001-Retirement Contributions 11,763
52003-PERS Unfunded Liability 39,098
53001-Employee Group Insurance 4,333
53002-Retiree Healthcare 2,122
55001-Medicare 2,531
61001-Advertising and Public Outreach 11,100
61013-Other Contract Services 531,000
62004-Publications and Subscriptions 300
62509-Misc Materials and Supplies 2,100
63001-Membership and Certifications 1,000
63002-Education and Training 5,000
63003-Trips and Meetings 6,750
1005-Natural Resource Protection 1,008,756
51001-Salaries - Regular 559,418
52001-Retirement Contributions 37,115
52003-PERS Unfunded Liability 129,480
53001-Employee Group Insurance 79,272
53002-Retiree Healthcare 7,027
55001-Medicare 7,985
61009-Regulatory Fees 40,000
61013-Other Contract Services 120,000
62003-Postage 500
62004-Publications and Subscriptions 500
62509-Misc Materials and Supplies 16,959
63002-Education and Training 10,000
63003-Trips and Meetings 500
1006-Tourism and Bid Promotion 2,253,147
51001-Salaries - Regular 172,399
51004-Salaries - Temporary 41,009
52001-Retirement Contributions 11,495
52003-PERS Unfunded Liability 49,308
53001-Employee Group Insurance 21,418
53002-Retiree Healthcare 2,067
55001-Medicare 3,068
61001-Advertising and Public Outreach 65,797
61013-Other Contract Services 1,794,586
62004-Publications and Subscriptions 16,000
62509-Misc Materials and Supplies 6,000
63001-Membership and Certifications 40,000
63002-Education and Training 15,000
63003-Trips and Meetings 15,000
141 Page 407 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
1007-Community Promotion 387,938
51001-Salaries - Regular 23,636
52001-Retirement Contributions 1,562
52003-PERS Unfunded Liability 5,146
53001-Employee Group Insurance 4,979
53002-Retiree Healthcare 279
55001-Medicare 336
61001-Advertising and Public Outreach 50,000
61013-Other Contract Services 298,000
63003-Trips and Meetings 4,000
1008-Downtown Association Administration 294,997
61013-Other Contract Services 294,997
1009-Community Services Group 637,158
51001-Salaries - Regular 388,848
52001-Retirement Contributions 26,017
52002-Retirement PARS - 401 2,727
52003-PERS Unfunded Liability 129,206
53001-Employee Group Insurance 28,230
53002-Retiree Healthcare 7,012
55001-Medicare 5,597
61008-Parking 995
61013-Other Contract Services 40,000
62002-Office Supplies 650
62007-Employee Recognition 1,000
62509-Misc Materials and Supplies 350
63001-Membership and Certifications 1,525
63002-Education and Training 3,500
63003-Trips and Meetings 1,500
1010-Office of DEI 630,184
51001-Salaries - Regular 214,044
52001-Retirement Contributions 16,503
52003-PERS Unfunded Liability 35,068
53001-Employee Group Insurance 12,562
53002-Retiree Healthcare 1,903
55001-Medicare 3,104
61013-Other Contract Services 336,000
63002-Education and Training 11,000
1021-City Clerk 690,291
51001-Salaries - Regular 358,110
51004-Salaries - Temporary 6,256
52001-Retirement Contributions 29,884
52003-PERS Unfunded Liability 94,034
53001-Employee Group Insurance 48,122
142 Page 408 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
53002-Retiree Healthcare 5,103
55001-Medicare 5,238
61001-Advertising and Public Outreach 10,000
61013-Other Contract Services 103,900
62001-Print and Reproduction 500
62002-Office Supplies 5,700
62004-Publications and Subscriptions 5,200
62010-Office Expenses - Other 1,000
63001-Membership and Certifications 1,545
63002-Education and Training 9,250
63003-Trips and Meetings 6,450
1031-Boysen Ranch Conserv Easement 7,500
61013-Other Contract Services 7,500
1101-Network Services 3,724,835
51001-Salaries - Regular 1,047,496
51004-Salaries - Temporary 49,258
51010-Overtime 37,500
51017-Standby 22,455
51018-Call Back 33,955
52001-Retirement Contributions 85,735
52003-PERS Unfunded Liability 236,502
53001-Employee Group Insurance 149,226
53002-Retiree Healthcare 12,835
55001-Medicare 15,675
61005-Data Processing Services 734,443
61013-Other Contract Services 533,884
61503-Electric Service 10,119
61505-Communication Service 333,710
62002-Office Supplies 305,180
62509-Misc Materials and Supplies 15,000
62511-Rents and Leases 45,061
63001-Membership and Certifications 2,200
63002-Education and Training 52,600
63003-Trips and Meetings 2,000
1103-Information Services 1,706,502
51001-Salaries - Regular 1,062,776
51010-Overtime 12,535
52001-Retirement Contributions 91,699
52003-PERS Unfunded Liability 255,706
53001-Employee Group Insurance 169,007
53002-Retiree Healthcare 13,878
55001-Medicare 15,307
61005-Data Processing Services 45,095
143 Page 409 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
61013-Other Contract Services 11,400
62002-Office Supplies 6,000
63002-Education and Training 22,700
63003-Trips and Meetings 400
1501-City Attorney 1,972,567
51001-Salaries - Regular 1,142,674
52001-Retirement Contributions 74,639
52002-Retirement PARS - 401 16,072
52003-PERS Unfunded Liability 240,441
53001-Employee Group Insurance 131,292
53002-Retiree Healthcare 13,049
55001-Medicare 16,057
56003-Contingency Expense 7,498
61007-Legal Services 226,150
61008-Parking 3,240
61013-Other Contract Services 60,950
62002-Office Supplies 500
62003-Postage 100
62004-Publications and Subscriptions 22,680
63001-Membership and Certifications 3,305
63002-Education and Training 12,400
63003-Trips and Meetings 1,520
2001-Financial Administration 383,035
51001-Salaries - Regular 274,322
52001-Retirement Contributions 17,991
52002-Retirement PARS - 401 2,279
52003-PERS Unfunded Liability 47,088
53001-Employee Group Insurance 4,548
53002-Retiree Healthcare 2,556
55001-Medicare 3,871
61008-Parking 1,080
61013-Other Contract Services 17,500
62002-Office Supplies 4,000
62007-Employee Recognition 800
63001-Membership and Certifications 650
63002-Education and Training 5,150
63003-Trips and Meetings 1,200
2002-Budget 273,153
51001-Salaries - Regular 142,233
52001-Retirement Contributions 9,399
52003-PERS Unfunded Liability 31,073
53001-Employee Group Insurance 9,940
53002-Retiree Healthcare 1,686
144 Page 410 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
55001-Medicare 2,022
56003-Contingency Expense 9,800
61001-Advertising and Public Outreach 2,800
61013-Other Contract Services 64,100
63002-Education and Training 100
2003-Revenue Management 618,412
51001-Salaries - Regular 228,721
52001-Retirement Contributions 19,204
52003-PERS Unfunded Liability 53,241
53001-Employee Group Insurance 38,459
53002-Retiree Healthcare 2,890
55001-Medicare 3,289
61013-Other Contract Services 172,035
62003-Postage 5,000
62010-Office Expenses - Other 1,575
63002-Education and Training 4,000
65013-Credit Cards Merchant Fees 90,000
2004-Purchasing 276,972
51001-Salaries - Regular 187,995
52001-Retirement Contributions 14,553
52003-PERS Unfunded Liability 41,702
53001-Employee Group Insurance 12,476
53002-Retiree Healthcare 2,263
55001-Medicare 2,672
61013-Other Contract Services 12,311
63002-Education and Training 3,000
2005-Accounting 1,466,586
51001-Salaries - Regular 874,881
52001-Retirement Contributions 62,177
52003-PERS Unfunded Liability 170,728
53001-Employee Group Insurance 106,656
53002-Retiree Healthcare 9,266
55001-Medicare 12,529
61001-Advertising and Public Outreach 900
61013-Other Contract Services 220,000
62003-Postage 2,000
63001-Membership and Certifications 350
63002-Education and Training 6,600
63003-Trips and Meetings 500
2007-NonDepartmental (934,139)
51001-Salaries - Regular 100,000
52001-Retirement Contributions 48,949
53002-Retiree Healthcare 2,075
145 Page 411 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
53003-Unemployment Insurance 30,000
56002-Misc Employee Reimbursement 15,000
59999 - Salary Savings (2,006,994)
61010-Ventures and Contingencies 200,000
61013-Other Contract Services 393,971
62001-Print and Reproduction 46,000
62003-Postage 43,000
62007-Employee Recognition 20,000
62010-Office Expenses - Other 6,000
62511-Rents and Leases 135,560
63001-Membership and Certifications 19,000
63002-Education and Training 3,300
65013-Credit Cards Merchant Fees 10,000
3001-Human Resources 2,067,937
51001-Salaries - Regular 1,182,794
51004-Salaries - Temporary 21,502
52001-Retirement Contributions 78,407
52002-Retirement PARS - 401 2,266
52003-PERS Unfunded Liability 257,682
53001-Employee Group Insurance 137,618
53002-Retiree Healthcare 13,985
55001-Medicare 17,180
61013-Other Contract Services 74,561
61029-Recruitment Expenses 82,772
61030 - Medical Services 5,400
62002-Office Supplies 3,500
62004-Publications and Subscriptions 6,800
62007-Employee Recognition 1,500
62008-Furniture and Fixtures 1,000
62009-Software Licensing and Maint Agreements 27,310
63001-Membership and Certifications 1,650
63002-Education and Training 129,710
63003-Trips and Meetings 21,300
65014-Misc Other Charges 1,000
3003-Wellness Program 49,500
61013-Other Contract Services 32,000
61028-Personnel Services 9,000
62008-Furniture and Fixtures 7,000
63003-Trips and Meetings 1,500
3050-Insurance ISF 6,066,253
54001-Workers Comp Insurance 2,355,887
61014-Liability Insurance 2,625,060
61015-Other Insurance 1,085,306
146 Page 412 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
4001-Community Development Administration 1,041,219
51001-Salaries - Regular 582,487
51010-Overtime 1,400
52001-Retirement Contributions 45,114
52002-Retirement PARS - 401 2,377
52003-PERS Unfunded Liability 129,915
53001-Employee Group Insurance 107,127
53002-Retiree Healthcare 7,051
55001-Medicare 8,336
61001-Advertising and Public Outreach 12,000
61005-Data Processing Services 8,500
61008-Parking 21,477
61013-Other Contract Services 1,800
62001-Print and Reproduction 5,000
62002-Office Supplies 5,000
62003-Postage 4,500
62004-Publications and Subscriptions 1,400
62007-Employee Recognition 3,000
62509-Misc Materials and Supplies 1,525
63001-Membership and Certifications 1,000
63002-Education and Training 5,000
63003-Trips and Meetings 1,210
65013-Credit Cards Merchant Fees 86,000
4002-Commissions and Committees 31,529
51002-Council and Commissioners 20,038
55001-Medicare 291
62004-Publications and Subscriptions 300
63002-Education and Training 7,600
63003-Trips and Meetings 3,300
4003-Planning 2,108,582
51001-Salaries - Regular 1,213,439
51004-Salaries - Temporary 70,653
51010-Overtime 12,500
52001-Retirement Contributions 97,760
52003-PERS Unfunded Liability 275,355
53001-Employee Group Insurance 158,160
53002-Retiree Healthcare 14,944
55001-Medicare 18,392
61013-Other Contract Services 221,179
62004-Publications and Subscriptions 500
62509-Misc Materials and Supplies 700
63001-Membership and Certifications 5,000
63002-Education and Training 19,000
147 Page 413 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
63003-Trips and Meetings 1,000
4004-Engineering 1,041,851
51001-Salaries - Regular 614,126
51004-Salaries - Temporary 63,750
51010-Overtime 12,000
52001-Retirement Contributions 54,854
52003-PERS Unfunded Liability 151,772
53001-Employee Group Insurance 66,309
53002-Retiree Healthcare 8,237
55001-Medicare 9,803
61013-Other Contract Services 47,000
62002-Office Supplies 3,000
62004-Publications and Subscriptions 500
63001-Membership and Certifications 3,500
63002-Education and Training 6,000
63003-Trips and Meetings 1,000
4006-Building and Safety 3,120,103
51001-Salaries - Regular 1,677,566
51010-Overtime 10,000
52001-Retirement Contributions 145,719
52003-PERS Unfunded Liability 338,125
53001-Employee Group Insurance 258,154
53002-Retiree Healthcare 18,351
55001-Medicare 24,213
61001-Advertising and Public Outreach 1,410
61005-Data Processing Services 44,394
61006-Engineering and Plan Checks 439,057
61011-Maintenance 2,440
61013-Other Contract Services 100,000
62004-Publications and Subscriptions 2,000
62506-Safety Materials and Supplies 500
62509-Misc Materials and Supplies 7,200
63001-Membership and Certifications 2,000
63002-Education and Training 47,675
63003-Trips and Meetings 1,300
4008-Housing Policy and Homelessness Programs 1,349,873
51001-Salaries - Regular 541,903
51010-Overtime 5,000
52001-Retirement Contributions 44,416
52003-PERS Unfunded Liability 122,468
53001-Employee Group Insurance 51,224
53002-Retiree Healthcare 6,647
55001-Medicare 7,858
148 Page 414 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
61013-Other Contract Services 555,357
62002-Office Supplies 6,800
62004-Publications and Subscriptions 700
63002-Education and Training 7,500
5001-Public Works Administration 1,535,427
51001-Salaries - Regular 997,828
51010-Overtime 1,200
52001-Retirement Contributions 70,658
52002-Retirement PARS - 401 795
52003-PERS Unfunded Liability 265,433
53001-Employee Group Insurance 126,121
53002-Retiree Healthcare 14,406
55001-Medicare 14,343
61008-Parking 540
61013-Other Contract Services 1,000
62001-Print and Reproduction 750
62002-Office Supplies 3,500
62004-Publications and Subscriptions 228
62007-Employee Recognition 6,000
62009-Software Licensing and Maint Agreements 1,605
62509-Misc Materials and Supplies 2,800
63001-Membership and Certifications 19,719
63002-Education and Training 7,500
63003-Trips and Meetings 1,000
5002-Parks Maintenance 4,321,345
51001-Salaries - Regular 1,384,808
51004-Salaries - Temporary 85,992
51010-Overtime 18,500
51017-Standby 18,500
51018-Call Back 1,000
52001-Retirement Contributions 131,093
52003-PERS Unfunded Liability 251,694
53001-Employee Group Insurance 257,905
53002-Retiree Healthcare 13,660
55001-Medicare 21,141
61011-Maintenance 3,750
61013-Other Contract Services 897,914
61501-City Water Service 801,892
61502-City Sewer Service 73,772
61503-Electric Service 157,272
61506-Solid Waste Service 30,269
62001-Print and Reproduction 750
62002-Office Supplies 500
149 Page 415 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
62004-Publications and Subscriptions 300
62009-Software Licensing and Maint Agreements 4,923
62501-Chemicals 12,000
62502-Construction Materials and Supplies 20,750
62503-Equipment Maintenance Supplies 22,500
62506-Safety Materials and Supplies 8,500
62509-Misc Materials and Supplies 91,000
63001-Membership and Certifications 2,960
63002-Education and Training 8,000
5003-Swim Center Maintenance 675,756
51001-Salaries - Regular 91,602
51004-Salaries - Temporary 21,767
51010-Overtime 4,500
51017-Standby 5,400
51018-Call Back 700
52001-Retirement Contributions 8,749
52003-PERS Unfunded Liability 21,080
53001-Employee Group Insurance 9,745
53002-Retiree Healthcare 1,144
55001-Medicare 1,618
61009-Regulatory Fees 1,000
61013-Other Contract Services 12,800
61501-City Water Service 83,000
61502-City Sewer Service 83,000
61503-Electric Service 101,013
61504-Natural Gas Service 96,489
61506-Solid Waste Service 3,184
62501-Chemicals 101,664
62502-Construction Materials and Supplies 3,500
62503-Equipment Maintenance Supplies 15,200
62506-Safety Materials and Supplies 600
62509-Misc Materials and Supplies 7,000
63002-Education and Training 1,000
5004-Urban Forest Services 269,189
51001-Salaries - Regular 168,286
51010-Overtime 4,500
52001-Retirement Contributions 16,196
52003-PERS Unfunded Liability 40,373
53001-Employee Group Insurance 19,265
53002-Retiree Healthcare 2,191
55001-Medicare 2,411
61011-Maintenance 300
61013-Other Contract Services 2,750
150 Page 416 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
62002-Office Supplies 100
62009-Software Licensing and Maint Agreements 4,779
62506-Safety Materials and Supplies 2,744
62509-Misc Materials and Supplies 1,458
63001-Membership and Certifications 280
63002-Education and Training 3,555
5005-Facilities Maintenance 1,511,395
51001-Salaries - Regular 445,252
51010-Overtime 8,000
51017-Standby 14,300
51018-Call Back 7,000
52001-Retirement Contributions 39,552
52003-PERS Unfunded Liability 106,795
53001-Employee Group Insurance 72,884
53002-Retiree Healthcare 5,796
55001-Medicare 6,398
61009-Regulatory Fees 450
61013-Other Contract Services 304,800
61501-City Water Service 29,256
61502-City Sewer Service 27,324
61503-Electric Service 300,000
61504-Natural Gas Service 36,843
61506-Solid Waste Service 43,858
62001-Print and Reproduction 250
62002-Office Supplies 250
62009-Software Licensing and Maint Agreements 4,923
62502-Construction Materials and Supplies 14,800
62503-Equipment Maintenance Supplies 4,000
62506-Safety Materials and Supplies 3,064
62509-Misc Materials and Supplies 32,100
63002-Education and Training 2,000
63003-Trips and Meetings 1,500
5006-Street/Sidewalk Maintenance 2,852,122
51001-Salaries - Regular 1,247,458
51004-Salaries - Temporary 46,216
51010-Overtime 9,700
51017-Standby 18,500
51018-Call Back 2,500
52001-Retirement Contributions 113,331
52003-PERS Unfunded Liability 241,817
53001-Employee Group Insurance 259,808
53002-Retiree Healthcare 13,124
55001-Medicare 18,589
151 Page 417 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
61013-Other Contract Services 497,500
61506-Solid Waste Service 25,000
62001-Print and Reproduction 3,000
62002-Office Supplies 100
62009-Software Licensing and Maint Agreements 4,779
62502-Construction Materials and Supplies 257,500
62506-Safety Materials and Supplies 8,400
62509-Misc Materials and Supplies 80,500
63002-Education and Training 4,300
5007-Traffic Signals and Lighting 657,854
51001-Salaries - Regular 179,732
51010-Overtime 2,400
51017-Standby 13,300
51018-Call Back 1,200
52001-Retirement Contributions 17,226
52003-PERS Unfunded Liability 42,624
53001-Employee Group Insurance 43,708
53002-Retiree Healthcare 2,313
55001-Medicare 2,564
61013-Other Contract Services 54,000
61503-Electric Service 256,000
62002-Office Supplies 100
62009-Software Licensing and Maint Agreements 13,255
62506-Safety Materials and Supplies 1,032
62509-Misc Materials and Supplies 25,400
63002-Education and Training 3,000
5008-Fleet 1,624,156
51001-Salaries - Regular 461,795
51010-Overtime 9,500
51018-Call Back 1,000
52001-Retirement Contributions 41,143
52003-PERS Unfunded Liability 92,172
53001-Employee Group Insurance 83,353
53002-Retiree Healthcare 5,002
55001-Medicare 6,629
61005-Data Processing Services 38,000
61009-Regulatory Fees 12,000
61013-Other Contract Services 133,500
62009-Software Licensing and Maint Agreements 14,362
62501-Chemicals 11,000
62503-Equipment Maintenance Supplies 192,200
62504-Fuel 504,000
62506-Safety Materials and Supplies 3,100
152 Page 418 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
62509-Misc Materials and Supplies 11,000
63001-Membership and Certifications 1,500
63002-Education and Training 2,500
63003-Trips and Meetings 400
5009-CIP Project Eng 3,121,592
51001-Salaries - Regular 2,018,571
51004-Salaries - Temporary 20,958
51010-Overtime 6,900
52001-Retirement Contributions 173,480
52003-PERS Unfunded Liability 484,470
53001-Employee Group Insurance 229,417
53002-Retiree Healthcare 26,293
55001-Medicare 29,547
61008-Parking 4,860
61009-Regulatory Fees 2,510
61013-Other Contract Services 20,000
62001-Print and Reproduction 2,500
62002-Office Supplies 2,500
62009-Software Licensing and Maint Agreements 65,744
62506-Safety Materials and Supplies 3,026
62509-Misc Materials and Supplies 5,000
63001-Membership and Certifications 3,817
63002-Education and Training 18,500
63003-Trips and Meetings 3,500
5010-Transportation Plan and Eng 1,010,847
51001-Salaries - Regular 621,142
51004-Salaries - Temporary 42,619
51010-Overtime 1,600
52001-Retirement Contributions 55,272
52003-PERS Unfunded Liability 138,586
53001-Employee Group Insurance 87,001
53002-Retiree Healthcare 7,521
55001-Medicare 9,625
61001-Advertising and Public Outreach 2,000
61008-Parking 2,160
61013-Other Contract Services 15,000
62001-Print and Reproduction 250
62002-Office Supplies 1,000
62009-Software Licensing and Maint Agreements 17,000
62506-Safety Materials and Supplies 150
62509-Misc Materials and Supplies 1,000
63001-Membership and Certifications 1,820
63002-Education and Training 7,100
153 Page 419 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
5011-Active Transportation 272,178
51001-Salaries - Regular 173,663
51004-Salaries - Temporary 5,881
52001-Retirement Contributions 11,913
52003-PERS Unfunded Liability 40,441
53001-Employee Group Insurance 28,010
53002-Retiree Healthcare 2,195
55001-Medicare 2,601
61001-Advertising and Public Outreach 5,000
62001-Print and Reproduction 250
62009-Software Licensing and Maint Agreements 444
63002-Education and Training 280
63003-Trips and Meetings 1,500
5101-Parking Admin 4,390,674
51001-Salaries - Regular 1,459,981
51004-Salaries - Temporary 360,320
51010-Overtime 8,000
51017-Standby 4,500
51018-Call Back 800
52001-Retirement Contributions 136,153
52002-Retirement PARS - 401 398
52003-PERS Unfunded Liability 288,774
53001-Employee Group Insurance 252,304
53002-Retiree Healthcare 15,672
55001-Medicare 26,025
61001-Advertising and Public Outreach 20,200
61005-Data Processing Services 160,000
61008-Parking 15,000
61011-Maintenance 96,000
61013-Other Contract Services 571,515
61501-City Water Service 6,936
61502-City Sewer Service 700
61503-Electric Service 274,666
61506-Solid Waste Service 7,344
62001-Print and Reproduction 63,000
62002-Office Supplies 5,000
62009-Software Licensing and Maint Agreements 19,000
62503-Equipment Maintenance Supplies 16,000
62509-Misc Materials and Supplies 26,525
63001-Membership and Certifications 1,345
63002-Education and Training 8,500
63003-Trips and Meetings 7,500
65013-Credit Cards Merchant Fees 538,517
154 Page 420 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
5201-Transit Ops and Maint 7,370,080
51001-Salaries - Regular 298,725
51004-Salaries - Temporary 18,862
51010-Overtime 2,500
52001-Retirement Contributions 23,782
52002-Retirement PARS - 401 133
52003-PERS Unfunded Liability 54,033
53001-Employee Group Insurance 62,623
53002-Retiree Healthcare 2,932
55001-Medicare 4,570
61001-Advertising and Public Outreach 20,000
61003-Auditing and Accounting Fees 5,800
61005-Data Processing Services 25,250
61008-Parking 1,620
61009-Regulatory Fees 7,000
61011-Maintenance 917,501
61013-Other Contract Services 66,100
61016-Purchased Transportation 5,090,438
61503-Electric Service 39,500
62001-Print and Reproduction 25,000
62002-Office Supplies 1,000
62008-Furniture and Fixtures 1,000
62009-Software Licensing and Maint Agreements 51,000
62504-Fuel 633,782
62509-Misc Materials and Supplies 2,500
63001-Membership and Certifications 3,330
63002-Education and Training 1,000
63003-Trips and Meetings 6,000
65013-Credit Cards Merchant Fees 4,100
5301-Stormwater 1,104,169
51001-Salaries - Regular 608,749
51004-Salaries - Temporary 49,258
51010-Overtime 4,600
51018-Call Back 300
52001-Retirement Contributions 53,296
52003-PERS Unfunded Liability 146,762
53001-Employee Group Insurance 82,423
53002-Retiree Healthcare 7,965
55001-Medicare 9,437
61005-Data Processing Services 1,000
61009-Regulatory Fees 18,500
61013-Other Contract Services 59,700
61503-Electric Service 500
155 Page 421 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
62002-Office Supplies 500
62009-Software Licensing and Maint Agreements 10,505
62503-Equipment Maintenance Supplies 2,400
62506-Safety Materials and Supplies 2,850
62509-Misc Materials and Supplies 34,675
63001-Membership and Certifications 3,250
63002-Education and Training 7,500
5302-Flood Control 70,200
61013-Other Contract Services 70,200
6001-Water Administration/Engineering 2,063,169
51001-Salaries - Regular 1,004,583
51003-Salaries - Contract 61,290
51004-Salaries - Temporary 67,450
51010-Overtime 5,000
52001-Retirement Contributions 69,547
52002-Retirement PARS - 401 530
52003-PERS Unfunded Liability 180,813
53001-Employee Group Insurance 107,604
53002-Retiree Healthcare 9,813
55001-Medicare 14,214
61001-Advertising and Public Outreach 70,000
61005-Data Processing Services 10,000
61007-Legal Services 90,000
61008-Parking 9,072
61013-Other Contract Services 73,796
61501-City Water Service 400
61502-City Sewer Service 350
61503-Electric Service 3,785
61504-Natural Gas Service 1,000
61505-Communication Service 2,750
62002-Office Supplies 2,500
62004-Publications and Subscriptions 2,500
62007-Employee Recognition 1,100
62009-Software Licensing and Maint Agreements 41,222
62010-Office Expenses - Other 2,750
62506-Safety Materials and Supplies 1,950
63001-Membership and Certifications 9,610
63002-Education and Training 15,050
65013-Credit Cards Merchant Fees 204,490
6002-Water Source of Supply 14,258,003
51001-Salaries - Regular 143,984
52001-Retirement Contributions 13,305
52003-PERS Unfunded Liability 32,225
156 Page 422 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
53001-Employee Group Insurance 20,712
53002-Retiree Healthcare 1,749
55001-Medicare 2,051
61012-Water Supply 62,712
61013-Other Contract Services 12,000
61017-Nacimiento Contribution for Operations & Maintenance 1,727,425
61018-Nacimiento Contribution for Electric Service 1,273,959
61019-Nacimiento Contribution for Capital Projects 649,238
61020-Nacimiento Contribution for Debt Service 4,615,844
61021-Salinas Contribution for Operations & Maintenance 1,296,271
61022-Salinas Contribution for Electric Service 164,594
61023-Salinas Contribution for Capital Projects 1,052,582
61024-Whale Rock Contribution for Operations & Maintenance 789,599
61025-Whale Rock Contribution for Electric Service 250,000
61026-Whale Rock Contribution for Capital Projects 1,857,852
61027-Control Systems 9,100
61503-Electric Service 118,000
62501-Chemicals 45,000
62503-Equipment Maintenance Supplies 7,000
62509-Misc Materials and Supplies 111,000
63001-Membership and Certifications 1,800
6003-Water Treatment 4,894,607
51001-Salaries - Regular 1,539,046
51010-Overtime 70,992
51017-Standby 19,500
51018-Call Back 10,000
52001-Retirement Contributions 148,262
52003-PERS Unfunded Liability 335,952
53001-Employee Group Insurance 261,070
53002-Retiree Healthcare 18,233
55001-Medicare 22,840
61005-Data Processing Services 1,100
61013-Other Contract Services 704,891
61027-Control Systems 14,543
61503-Electric Service 719,000
61505-Communication Service 7,150
61506-Solid Waste Service 7,333
62002-Office Supplies 3,020
62004-Publications and Subscriptions 300
62007-Employee Recognition 1,300
62009-Software Licensing and Maint Agreements 260
62501-Chemicals 747,504
62502-Construction Materials and Supplies 36,500
157 Page 423 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
62503-Equipment Maintenance Supplies 112,950
62506-Safety Materials and Supplies 29,560
62509-Misc Materials and Supplies 59,300
63001-Membership and Certifications 3,500
63002-Education and Training 20,500
6004-Water Distribution 2,209,322
51001-Salaries - Regular 1,032,689
51010-Overtime 27,000
51017-Standby 19,000
51018-Call Back 45,000
52001-Retirement Contributions 95,752
52003-PERS Unfunded Liability 259,350
53001-Employee Group Insurance 179,674
53002-Retiree Healthcare 14,075
55001-Medicare 14,830
61005-Data Processing Services 9,786
61011-Maintenance 1,000
61013-Other Contract Services 121,238
61027-Control Systems 26,198
61503-Electric Service 50,312
61505-Communication Service 19,030
62002-Office Supplies 1,550
62003-Postage 150
62007-Employee Recognition 1,300
62008-Furniture and Fixtures 300
62010-Office Expenses - Other 2,000
62501-Chemicals 300
62502-Construction Materials and Supplies 175,099
62503-Equipment Maintenance Supplies 23,000
62506-Safety Materials and Supplies 15,798
62509-Misc Materials and Supplies 42,990
63001-Membership and Certifications 4,400
63002-Education and Training 27,500
6005-Water Resources 725,786
51001-Salaries - Regular 431,700
51010-Overtime 5,000
52001-Retirement Contributions 37,520
52003-PERS Unfunded Liability 99,487
53001-Employee Group Insurance 63,371
53002-Retiree Healthcare 5,399
55001-Medicare 6,219
61005-Data Processing Services 6,466
61013-Other Contract Services 15,000
158 Page 424 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
61505-Communication Service 3,300
62001-Print and Reproduction 1,000
62002-Office Supplies 600
62003-Postage 2,500
62007-Employee Recognition 400
62506-Safety Materials and Supplies 1,425
62509-Misc Materials and Supplies 32,700
63001-Membership and Certifications 7,700
63002-Education and Training 5,000
63003-Trips and Meetings 1,000
6101-Wastewater Admin and Eng 2,096,405
51001-Salaries - Regular 1,098,803
51003-Salaries - Contract 164,232
51010-Overtime 5,000
52001-Retirement Contributions 89,438
52002-Retirement PARS - 401 663
52003-PERS Unfunded Liability 215,975
53001-Employee Group Insurance 135,599
53002-Retiree Healthcare 11,721
55001-Medicare 16,750
61001-Advertising and Public Outreach 13,000
61005-Data Processing Services 8,000
61007-Legal Services 25,000
61008-Parking 5,670
61013-Other Contract Services 12,233
61028-Personnel Services 10,100
61501-City Water Service 400
61502-City Sewer Service 350
61503-Electric Service 3,785
61504-Natural Gas Service 1,000
61505-Communication Service 3,300
62002-Office Supplies 2,500
62004-Publications and Subscriptions 500
62007-Employee Recognition 1,100
62009-Software Licensing and Maint Agreements 38,785
62010-Office Expenses - Other 2,750
62506-Safety Materials and Supplies 1,150
63001-Membership and Certifications 16,610
63002-Education and Training 7,500
65013-Credit Cards Merchant Fees 204,490
6102-Wastewater Collection 1,819,828
51001-Salaries - Regular 951,143
51010-Overtime 7,500
159 Page 425 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
51017-Standby 16,500
51018-Call Back 34,500
52001-Retirement Contributions 88,869
52003-PERS Unfunded Liability 200,907
53001-Employee Group Insurance 150,120
53002-Retiree Healthcare 10,904
55001-Medicare 13,700
61009-Regulatory Fees 5,260
61013-Other Contract Services 57,800
61027-Control Systems 12,450
61503-Electric Service 39,098
61504-Natural Gas Service 1,125
61505-Communication Service 14,500
62002-Office Supplies 2,000
62007-Employee Recognition 500
62009-Software Licensing and Maint Agreements 36,380
62010-Office Expenses - Other 3,500
62502-Construction Materials and Supplies 73,775
62503-Equipment Maintenance Supplies 31,763
62506-Safety Materials and Supplies 12,960
62509-Misc Materials and Supplies 26,800
63001-Membership and Certifications 5,275
63002-Education and Training 22,500
6103-Environmental Programs 345,517
51001-Salaries - Regular 162,607
51010-Overtime 1,500
52001-Retirement Contributions 15,838
52003-PERS Unfunded Liability 67,806
53001-Employee Group Insurance 25,829
53002-Retiree Healthcare 3,680
55001-Medicare 2,358
61001-Advertising and Public Outreach 2,000
61013-Other Contract Services 43,600
61505-Communication Service 3,000
62001-Print and Reproduction 500
62002-Office Supplies 1,000
62007-Employee Recognition 200
62009-Software Licensing and Maint Agreements 6,500
62506-Safety Materials and Supplies 1,100
62509-Misc Materials and Supplies 1,000
63001-Membership and Certifications 1,000
63002-Education and Training 6,000
6104-Water Resource Recovery 5,576,038
160 Page 426 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
51001-Salaries - Regular 1,432,184
51010-Overtime 37,000
51017-Standby 19,500
51018-Call Back 12,500
52001-Retirement Contributions 133,922
52003-PERS Unfunded Liability 334,320
53001-Employee Group Insurance 195,899
53002-Retiree Healthcare 18,144
55001-Medicare 20,566
61009-Regulatory Fees 93,933
61013-Other Contract Services 1,147,150
61501-City Water Service 7,100
61502-City Sewer Service 7,000
61503-Electric Service 1,148,000
61504-Natural Gas Service 27,000
61505-Communication Service 12,000
61506-Solid Waste Service 30,000
62002-Office Supplies 13,500
62007-Employee Recognition 1,300
62009-Software Licensing and Maint Agreements 34,000
62501-Chemicals 600,440
62502-Construction Materials and Supplies 11,000
62503-Equipment Maintenance Supplies 167,500
62506-Safety Materials and Supplies 27,880
62509-Misc Materials and Supplies 11,200
63001-Membership and Certifications 7,000
63002-Education and Training 26,000
6105-Utility Billing 814,630
51001-Salaries - Regular 189,967
51010-Overtime 3,000
52001-Retirement Contributions 18,503
52003-PERS Unfunded Liability 33,305
53001-Employee Group Insurance 47,500
53002-Retiree Healthcare 1,808
55001-Medicare 2,755
61005-Data Processing Services 61,600
61013-Other Contract Services 332,280
62001-Print and Reproduction 32,622
62002-Office Supplies 500
62003-Postage 85,891
62007-Employee Recognition 300
62505-Machinery and Equipment 750
62509-Misc Materials and Supplies 250
161 Page 427 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
63002-Education and Training 3,000
63003-Trips and Meetings 600
6106-Water Quality Lab 904,586
51001-Salaries - Regular 457,153
51010-Overtime 9,000
52001-Retirement Contributions 39,837
52003-PERS Unfunded Liability 98,548
53001-Employee Group Insurance 78,264
53002-Retiree Healthcare 5,348
55001-Medicare 6,559
61009-Regulatory Fees 8,500
61013-Other Contract Services 120,300
61505-Communication Service 3,000
62002-Office Supplies 1,200
62007-Employee Recognition 500
62506-Safety Materials and Supplies 5,350
62509-Misc Materials and Supplies 53,150
63001-Membership and Certifications 4,877
63002-Education and Training 13,000
6107-Solid Waste Recycling 422,183
51001-Salaries - Regular 242,533
51010-Overtime 4,000
52001-Retirement Contributions 19,396
52003-PERS Unfunded Liability 49,230
53001-Employee Group Insurance 50,626
53002-Retiree Healthcare 2,672
55001-Medicare 3,517
61001-Advertising and Public Outreach 3,200
61008-Parking 2,040
61013-Other Contract Services 35,000
62001-Print and Reproduction 500
62002-Office Supplies 200
62004-Publications and Subscriptions 200
62509-Misc Materials and Supplies 500
63001-Membership and Certifications 1,070
63002-Education and Training 6,000
63003-Trips and Meetings 1,500
6201-Reservoir Operations 1,763,890
51001-Salaries - Regular 493,038
51010-Overtime 3,000
51017-Standby 22,245
51018-Call Back 4,000
52001-Retirement Contributions 39,848
162 Page 428 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
52002-Retirement PARS - 401 133
52003-PERS Unfunded Liability 117,013
53001-Employee Group Insurance 58,278
53002-Retiree Healthcare 6,351
55001-Medicare 7,118
61005-Data Processing Services 6,466
61007-Legal Services 20,000
61011-Maintenance 16,200
61013-Other Contract Services 134,000
61027-Control Systems 12,653
61503-Electric Service 700,400
61505-Communication Service 16,100
61506-Solid Waste Service 3,600
62002-Office Supplies 1,500
62007-Employee Recognition 500
62501-Chemicals 700
62502-Construction Materials and Supplies 6,000
62503-Equipment Maintenance Supplies 5,500
62506-Safety Materials and Supplies 62,150
62509-Misc Materials and Supplies 18,900
63001-Membership and Certifications 600
63002-Education and Training 6,100
63003-Trips and Meetings 1,500
7001-Recreation Administration 1,214,159
51001-Salaries - Regular 658,223
51003-Salaries - Contract 76,323
51004-Salaries - Temporary 64,357
51010-Overtime 300
52001-Retirement Contributions 60,027
52002-Retirement PARS - 401 2,371
52003-PERS Unfunded Liability 151,488
53001-Employee Group Insurance 75,474
53002-Retiree Healthcare 8,222
55001-Medicare 11,480
61001-Advertising and Public Outreach 1,000
61005-Data Processing Services 21,000
61008-Parking 7,470
61013-Other Contract Services 2,900
62001-Print and Reproduction 2,400
62002-Office Supplies 11,800
62003-Postage 200
62004-Publications and Subscriptions 400
62007-Employee Recognition 2,000
163 Page 429 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
62010-Office Expenses - Other 15,000
62502-Construction Materials and Supplies 4,287
62509-Misc Materials and Supplies 18,175
63001-Membership and Certifications 1,210
63002-Education and Training 5,050
63003-Trips and Meetings 1,000
65013-Credit Cards Merchant Fees 12,000
7002-Recreation Facilities 440,328
51001-Salaries - Regular 169,764
51004-Salaries - Temporary 106,922
51010-Overtime 400
52001-Retirement Contributions 15,780
52003-PERS Unfunded Liability 40,396
53001-Employee Group Insurance 33,589
53002-Retiree Healthcare 2,192
55001-Medicare 3,905
61013-Other Contract Services 48,850
61014-Liability Insurance 10,000
62002-Office Supplies 800
62509-Misc Materials and Supplies 6,000
63001-Membership and Certifications 330
63002-Education and Training 1,400
7003-Youth Services 1,641,690
51001-Salaries - Regular 610,225
51004-Salaries - Temporary 564,726
51010-Overtime 2,000
52001-Retirement Contributions 64,198
52003-PERS Unfunded Liability 136,332
53001-Employee Group Insurance 79,239
53002-Retiree Healthcare 7,399
55001-Medicare 16,689
61001-Advertising and Public Outreach 500
61013-Other Contract Services 52,950
62001-Print and Reproduction 1,000
62002-Office Supplies 1,500
62008-Furniture and Fixtures 3,500
62507-Public Safety Supplies 2,610
62509-Misc Materials and Supplies 38,271
62511-Rents and Leases 48,600
63001-Membership and Certifications 1,350
63002-Education and Training 10,600
7004-Community Services 625,974
51001-Salaries - Regular 277,327
164 Page 430 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
51004-Salaries - Temporary 78,425
51010-Overtime 1,000
52001-Retirement Contributions 21,613
52003-PERS Unfunded Liability 71,925
53001-Employee Group Insurance 37,099
53002-Retiree Healthcare 3,903
55001-Medicare 5,203
61001-Advertising and Public Outreach 500
61013-Other Contract Services 56,280
62002-Office Supplies 800
62003-Postage 500
62502-Construction Materials and Supplies 2,500
62508-Recreation Supplies 15,000
62509-Misc Materials and Supplies 6,000
62511-Rents and Leases 41,400
63001-Membership and Certifications 500
63002-Education and Training 6,000
7005-Ranger Service 973,610
51001-Salaries - Regular 548,428
51004-Salaries - Temporary 84,448
51010-Overtime 1,000
52001-Retirement Contributions 49,273
52003-PERS Unfunded Liability 127,252
53001-Employee Group Insurance 80,394
53002-Retiree Healthcare 6,906
55001-Medicare 9,019
61013-Other Contract Services 29,950
62001-Print and Reproduction 2,500
62502-Construction Materials and Supplies 16,250
62505-Machinery and Equipment 6,000
62509-Misc Materials and Supplies 7,000
63001-Membership and Certifications 690
63002-Education and Training 4,500
7006-Aquatics 751,481
51001-Salaries - Regular 86,663
51004-Salaries - Temporary 507,964
51010-Overtime 1,000
52001-Retirement Contributions 21,358
52003-PERS Unfunded Liability 31,506
53001-Employee Group Insurance 27,643
53002-Retiree Healthcare 1,710
55001-Medicare 8,314
61013-Other Contract Services 48,543
165 Page 431 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
62002-Office Supplies 600
62505-Machinery and Equipment 5,000
62506-Safety Materials and Supplies 2,000
62508-Recreation Supplies 700
62509-Misc Materials and Supplies 6,150
63001-Membership and Certifications 330
63002-Education and Training 2,000
7007-Golf Course 866,480
51001-Salaries - Regular 312,231
51004-Salaries - Temporary 107,419
51010-Overtime 1,000
52001-Retirement Contributions 26,882
52003-PERS Unfunded Liability 72,641
53001-Employee Group Insurance 49,043
53002-Retiree Healthcare 3,942
55001-Medicare 6,054
61001-Advertising and Public Outreach 400
61005-Data Processing Services 11,700
61011-Maintenance 14,500
61013-Other Contract Services 26,567
61501-City Water Service 135,000
61502-City Sewer Service 3,500
61503-Electric Service 10,000
61504-Natural Gas Service 400
61506-Solid Waste Service 3,000
62002-Office Supplies 1,500
62501-Chemicals 12,500
62502-Construction Materials and Supplies 22,500
62506-Safety Materials and Supplies 2,500
62509-Misc Materials and Supplies 28,400
63001-Membership and Certifications 1,800
63002-Education and Training 3,000
65013-Credit Cards Merchant Fees 10,000
7008-Jack House 5,500
61001-Advertising and Public Outreach 2,000
62508-Recreation Supplies 3,500
8001-Police Administration 2,868,034
51001-Salaries - Regular 959,065
51010-Overtime 2,100
52001-Retirement Contributions 132,815
52002-Retirement PARS - 401 2,857
52003-PERS Unfunded Liability 318,092
53001-Employee Group Insurance 90,425
166 Page 432 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
53002-Retiree Healthcare 17,263
55001-Medicare 13,405
61011-Maintenance 2,000
61013-Other Contract Services 922,531
61501-City Water Service 19,392
61502-City Sewer Service 10,850
61503-Electric Service 170,600
61504-Natural Gas Service 17,100
62002-Office Supplies 8,700
62003-Postage 6,900
62004-Publications and Subscriptions 1,400
62007-Employee Recognition 9,400
62008-Furniture and Fixtures 7,700
62010-Office Expenses - Other 9,600
62507-Public Safety Supplies 9,200
62509-Misc Materials and Supplies 4,300
63001-Membership and Certifications 4,540
63002-Education and Training 123,200
63003-Trips and Meetings 4,100
65013-Credit Cards Merchant Fees 500
8002-Patrol 15,303,917
51001-Salaries - Regular 8,275,828
51010-Overtime 603,397
51018-Call Back 203,705
52001-Retirement Contributions 1,166,918
52003-PERS Unfunded Liability 3,517,861
53001-Employee Group Insurance 909,730
53002-Retiree Healthcare 190,921
55001-Medicare 112,501
61011-Maintenance 32,300
61013-Other Contract Services 96,656
62504-Fuel 1,000
62505-Machinery and Equipment 81,900
62506-Safety Materials and Supplies 40,700
62507-Public Safety Supplies 59,500
62509-Misc Materials and Supplies 11,000
8003-Investigations 3,640,653
51001-Salaries - Regular 1,873,380
51010-Overtime 198,837
51017-Standby 21,289
51018-Call Back 44,683
52001-Retirement Contributions 234,618
52003-PERS Unfunded Liability 925,835
167 Page 433 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
53001-Employee Group Insurance 188,767
53002-Retiree Healthcare 50,247
55001-Medicare 25,652
61013-Other Contract Services 25,500
62507-Public Safety Supplies 15,900
62509-Misc Materials and Supplies 3,000
62512-Investigative Supplies 32,945
8004-Police Support Services 3,843,128
51001-Salaries - Regular 2,330,702
51010-Overtime 25,895
51018-Call Back 37,677
52001-Retirement Contributions 171,504
52003-PERS Unfunded Liability 668,479
53001-Employee Group Insurance 276,298
53002-Retiree Healthcare 36,280
55001-Medicare 32,258
61005-Data Processing Services 39,700
61013-Other Contract Services 212,335
61505-Communication Service 2,000
62002-Office Supplies 8,000
62509-Misc Materials and Supplies 2,000
8005-Neighborhood Services 327,528
51001-Salaries - Regular 137,689
51004-Salaries - Temporary 91,174
52001-Retirement Contributions 9,098
52003-PERS Unfunded Liability 31,742
53001-Employee Group Insurance 10,023
53002-Retiree Healthcare 1,723
55001-Medicare 3,279
61001-Advertising and Public Outreach 20,000
61013-Other Contract Services 12,000
62509-Misc Materials and Supplies 5,800
63002-Education and Training 5,000
8006-Traffic Safety 1,065,112
51001-Salaries - Regular 523,087
51010-Overtime 59,370
51018-Call Back 21,414
52001-Retirement Contributions 102,302
52003-PERS Unfunded Liability 249,474
53001-Employee Group Insurance 65,394
53002-Retiree Healthcare 13,539
55001-Medicare 7,031
61011-Maintenance 2,900
168 Page 434 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
62010-Office Expenses - Other 800
62504-Fuel 8,600
62505-Machinery and Equipment 2,400
62506-Safety Materials and Supplies 3,300
62509-Misc Materials and Supplies 5,500
8501-Fire Administration 1,663,046
51001-Salaries - Regular 798,062
51004-Salaries - Temporary 64,139
51010-Overtime 2,700
52001-Retirement Contributions 131,118
52002-Retirement PARS - 401 2,503
52003-PERS Unfunded Liability 159,711
53001-Employee Group Insurance 69,258
53002-Retiree Healthcare 8,668
55001-Medicare 12,069
61005-Data Processing Services 70,639
61013-Other Contract Services 172,744
61501-City Water Service 19,400
61502-City Sewer Service 17,472
61503-Electric Service 95,760
61504-Natural Gas Service 10,000
62001-Print and Reproduction 1,000
62002-Office Supplies 5,000
62003-Postage 100
62007-Employee Recognition 2,500
62010-Office Expenses - Other 500
62509-Misc Materials and Supplies 3,100
63001-Membership and Certifications 2,954
63002-Education and Training 12,000
63003-Trips and Meetings 1,650
8502-Emergency Reponse 14,943,921
51001-Salaries - Regular 6,943,971
51010-Overtime 1,699,939
51012-Overtime - Training 81,862
51018-Call Back 10,584
52001-Retirement Contributions 1,213,646
52003-PERS Unfunded Liability 3,494,805
53001-Employee Group Insurance 816,264
53002-Retiree Healthcare 189,670
55001-Medicare 94,040
61005-Data Processing Services 30,000
61013-Other Contract Services 18,991
62503-Equipment Maintenance Supplies 2,300
169 Page 435 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
62505-Machinery and Equipment 216,200
62506-Safety Materials and Supplies 40,100
62507-Public Safety Supplies 55,000
62509-Misc Materials and Supplies 36,550
8503-Hazard Prevention 1,209,258
51001-Salaries - Regular 754,328
51010-Overtime 5,984
52001-Retirement Contributions 49,973
52003-PERS Unfunded Liability 220,802
53001-Employee Group Insurance 94,527
53002-Retiree Healthcare 11,983
55001-Medicare 10,751
61005-Data Processing Services 38,000
61013-Other Contract Services 3,000
62002-Office Supplies 600
62004-Publications and Subscriptions 4,335
62010-Office Expenses - Other 1,400
62506-Safety Materials and Supplies 1,000
62507-Public Safety Supplies 2,000
62509-Misc Materials and Supplies 1,450
63001-Membership and Certifications 1,125
63002-Education and Training 7,400
63003-Trips and Meetings 600
8504-Training Services 139,174
61005-Data Processing Services 8,600
61013-Other Contract Services 67,000
62507-Public Safety Supplies 21,700
63001-Membership and Certifications 250
63002-Education and Training 41,124
63003-Trips and Meetings 500
8506-Fire Apparatus Services 627,235
51001-Salaries - Regular 205,440
51010-Overtime 14,290
51017-Standby 1,787
52001-Retirement Contributions 14,419
52003-PERS Unfunded Liability 44,695
53001-Employee Group Insurance 42,942
53002-Retiree Healthcare 2,426
55001-Medicare 2,721
56002-Misc Employee Reimbursement 3,000
61005-Data Processing Services 2,400
61013-Other Contract Services 36,930
62502-Construction Materials and Supplies 2,000
170 Page 436 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
62503-Equipment Maintenance Supplies 113,666
62504-Fuel 121,300
62509-Misc Materials and Supplies 6,800
63001-Membership and Certifications 820
63002-Education and Training 11,600
8507-Fire Station Facility Support 44,127
61013-Other Contract Services 14,000
62503-Equipment Maintenance Supplies 2,600
62507-Public Safety Supplies 27,527
8510-Mobile Crisis Unit 307,711
51001-Salaries - Regular 69,494
51003-Salaries - Contract 74,158
51010-Overtime 12,000
52001-Retirement Contributions 13,797
53001-Employee Group Insurance 12,208
55001-Medicare 2,054
61013-Other Contract Services 100,000
62002-Office Supplies 1,000
62509-Misc Materials and Supplies 18,000
63002-Education and Training 5,000
8599-Emergency Management 215,564
51001-Salaries - Regular 126,567
52001-Retirement Contributions 8,363
52003-PERS Unfunded Liability 31,193
53001-Employee Group Insurance 24,919
53002-Retiree Healthcare 1,693
55001-Medicare 1,799
61001-Advertising and Public Outreach 4,450
62001-Print and Reproduction 1,500
62002-Office Supplies 1,500
62010-Office Expenses - Other 1,000
62507-Public Safety Supplies 4,510
62509-Misc Materials and Supplies 1,100
63001-Membership and Certifications 330
63002-Education and Training 5,500
63003-Trips and Meetings 1,140
9105-San Luis Ranch 727,018
61009-Regulatory Fees 602,885
61013-Other Contract Services 124,133
9107-Avila Ranch 152,675
61011-Maintenance 23,000
61013-Other Contract Services 110,175
61501-City Water Service 10,000
171 Page 437 of 454
Operating Budget Line Item Detail (All Funds)FY 2026-27
61502-City Sewer Service 2,000
61503-Electric Service 7,500$
172 Page 438 of 454
User Fee Cost Recovery Goals
The following is an excerpt from the 2025-27 Financial Plan on user fee cost recovery:
A. Ongoing Review
Fees will be reviewed and updated on an ongoing basis to ensure that they keep pace with changes
in the cost-of-living as well as changes in methods or levels of service delivery.
In implementing this goal, a comprehensive analysis of City costs and fees should be made at least
every three years. In the interim, fees will be adjusted by annual changes in the Consumer Price Index.
Fees may be adjusted during this interim period based on supplemental analysis whenever there have
been significant changes in the method, level or cost of service delivery.
B. User Fee Cost Recovery Levels
In setting user fees and cost recovery levels, the following factors will be considered:
1. Community-Wide Versus Special Benefit. The level of user fee cost recovery should consider the
community-wide versus special service nature of the program or activity. The use of general-
purpose revenues is appropriate for community-wide services, while user fees are appropriate for
services that are of special benefit to easily identified individuals or groups.
2. Service Recipient Versus Service Driver. After considering community-wide versus special benefit
of the service, the concept of service recipient versus service driver should also be considered.
For example, it could be argued that the applicant is not the beneficiary of the City's development
review efforts: the community is the primary beneficiary. However, the applicant is the driver of
development review costs, and as such, cost recovery from the applicant is appropriate.
3. Effect of Pricing on the Demand for Services. The level of cost recovery and related pricing of
services can significantly affect the demand and subsequent level of services provided. At full cost
recovery, this has the specific advantage of ensuring that the City is providing services for which
there is genuinely a market that is not overly-stimulated by artificially low prices.
Conversely, high levels of cost recovery will negatively impact the delivery of services to lower
income groups. This negative feature is especially pronounced, and works against public policy,
if the services are specifically targeted to low-income groups.
4. Feasibility of Collection and Recovery. Although it may be determined that a high level of cost
recovery may be appropriate for specific services, it may be impractical or too costly to establish
a system to identify and charge the user. Accordingly, the feasibility of assessing and collecting
charges should also be considered in developing user fees, especially if significant program costs
are intended to be financed from that source.
C. Factors Favoring Low-Cost Recovery Levels
Very low-cost recovery levels are appropriate under the following circumstances:
Page 439 of 454
1. There is no intended relationship between the amount paid and the benefit received. Almost all
"social service" programs fall into this category as it is expected that one group will subsidize
another.
2. Collecting fees is not cost-effective or will significantly impact the efficient delivery of the service.
3. There is no intent to limit the use of (or entitlement to) the service. Again, most "social service"
programs fit into this category as well as many public safety (police and fire) emergency response
services and the ability to appeal planning decisions. Historically, access to neighborhood and
community parks would also fit into this category.
4. The service is non-recurring, generally delivered on a "peak demand" or emergency basis, cannot
reasonably be planned for on an individual basis, and is not readily available from a private sector
source. Many public safety services also fall into this category.
5. Collecting fees would discourage compliance with regulatory requirements and adherence is
primarily self-identified, and as such, failure to comply would not be readily detected by the City.
Many small-scale licenses and permits might fall into this category.
D. Factors Favoring High Cost Recovery Levels
The use of service charges as a major source of funding service levels is especially appropriate under
the following circumstances:
1. The service is similar to services provided through the private sector.
2. Other private or public sector alternatives could or do exist for the delivery of the service.
3. For equity or demand management purposes, it is intended that there be a direct relationship
between the amount paid and the level and cost of the service received.
4. The use of the service is specifically discouraged. Police responses to disturbances or false alarms
might fall into this category.
5. The service is regulatory in nature and voluntary compliance is not expected to be the primary
method of detecting failure to meet regulatory requirements. Building permit, plan checks, and
subdivision review fees for large projects would fall into this category.
E. General Concepts Regarding the Use of Service Charges
The following general concepts will be used in developing and implementing service charges:
1. Revenues should not exceed the reasonable cost of providing the service.
2. Cost recovery goals should be based on the total cost of delivering the service, including direct
costs, departmental administration costs and organization-wide support costs such as accounting,
personnel, information technology, legal services, fleet maintenance and insurance.
Page 440 of 454
3. The method of assessing and collecting fees should be as simple as possible in order to reduce the
administrative cost of collection.
4. Rate structures should be sensitive to the "market" for similar services as well as to smaller,
infrequent users of the service.
5. A unified approach should be used in determining cost recovery levels for various programs based
on the factors discussed above.
F. Low Cost-Recovery Services
Based on the criteria discussed above, the following types of services should have very low-cost
recovery goals. In selected circumstances, there may be specific activities within the broad scope of
services provided that should have user charges associated with them. However, the primary source
of funding for the operation as a whole should be general-purpose revenues, not user fees.
1. Delivering public safety emergency response services such as police patrol services and fire
suppression.
2. Maintaining and developing public facilities that are provided on a uniform, community-wide
basis such as streets, parks and general-purpose buildings.
3. Providing social service programs and economic development activities.
4. Appealing planning decisions. Appeal fees are charged based on a tiered system and fees for all
tiers should be at 15% cost recovery for both applicants and non-applicants, based on the cost of
responding to appeals initiated by the applicant.
G. Recreation Programs
The following cost recovery policies apply to the City's recreation programs:
1. Cost recovery for activities directed to adults should be relatively high.
2. Cost recovery for activities directed to youth and seniors should be relatively low. In those
circumstances where services are similar to those provided in the private sector, cost recovery
levels should be higher.
Although ability to pay may not be a concern for all youth and senior participants, these are
desired program activities, and the cost of determining need may be greater than the cost of
providing a uniform service fee structure to all participants. Further, there is a community -wide
benefit in encouraging high-levels of participation in youth and senior recreation activities
regardless of financial status.
3. Fees for golf activities should be comparable to other communities.
4. Cost recovery goals for recreation activities are set as follows:
Page 441 of 454
High-Range Cost Recovery Activities - (60% to 100%)
a. Adult athletics
b. Banner permit applications
c. Major commercial film permit applications
Mid-Range Cost Recovery Activities - (30% to 60%)
d. Triathlon
e. Summer and Spring Break Camps
f. Junior Ranger camp
g. Childcare services
h. Classes
Low-Range Cost Recovery Activities- (0 to 30%)
i. Aquatics
j. Community gardens
k. Minor commercial film permit applications
l. Skate park
m. Parks and Recreation sponsored events (except for Triathlon)
n. Youth sports
o. Teen services
p. Senior services
5. For cost recovery activities of less than 100%, there should be a differential in rates between
residents and non-residents. However, the Director of Parks and Recreation is authorized to
reduce or eliminate non-resident fee differentials when it can be demonstrated that:
a. The fee is reducing attendance.
b. There are no appreciable expenditure savings from the reduced attendance.
6. Charges will be assessed for use of rooms, pools, gymnasiums, ball fields, special-use areas, and
recreation equipment for activities not sponsored or co-sponsored by the City. Such charges
should be based upon comparability with other communities. However, the Director of Parks and
Recreation is authorized to charge fees that are closer to full cost recovery for facilities that are
heavily used at peak times and include a majority of non-resident users.
7. A vendor charge of at least 10 percent of gross income will be assessed from individuals or
organizations using City facilities for moneymaking activities.
8. The Director of Parks and Recreation is authorized to offer reduced fees such as introductory
rates, family discounts and coupon discounts on a pilot basis (not to exceed 18 months) to
promote new recreation programs or revive existing ones.
9. The Parks and Recreation Department will consider waiving fees only when the City Manager
determines in writing that an undue hardship exists.
H. Development Review Programs
Page 442 of 454
The following cost recovery policies apply to the development review programs:
1. Services provided under this category include:
a. Planning (planned development permits, tentative tract and parcel maps, re-zonings, general
plan amendments, variances, use permits).
b. Building and safety (building permits, structural plan checks, inspections).
c. Engineering (public improvement plan checks, inspections, subdivision requirements,
encroachments).
d. Fire plan check.
2. Cost recovery for these services should generally be very high. In most instances, the City's cost
recovery goal should be 100%.
3. However, in charging high cost recovery levels, the City needs to clearly establish and articulate
standards for its performance in reviewing developer applications to ensure that there is “value
for cost.”
4. Building Permit Plan Check Services – The City of San Luis Obispo offers building permit plan check
services through consultants at a set price, not to exceed 65% of the City’s fee for the service.
Building Permit Plan Check Services are offered by the City on a 100% cost-recovery basis, and the
service is provided after the fee is paid in full. As a result, the Finance Director is authorized to
make appropriations from the related revenue account to cover the cost of the services provided.
I. Services Supporting Sustainability Goals of the City
Fees for services that support the sustainability goals of the City should be set at 50% cost recovery.
These include:
1. Building permits for:
a. Electric Car Charging System
b. Graywater System
c. Graywater/Rainwater Harvesting System
d. Heat Pump
e. Insulation/Energy Update
f. Photovoltaic Systems
g. Photovoltaic Unit Installation – Residential
h. Residential Photovoltaic System
i. Solar/PV System - Commercial BLDG
j. Solar/PV System – Multifamily BLDG
k. Solar Water System Fixtures - BLDG
l. Doors/Windows
m. Electric Service Upgrades
n. New/Altered Circuits
o. Window Retrofit
2. Pedicab Fee and Pedicab Renewal Fee
Page 443 of 454
J. Concealed Carry Weapon Permit fee
The Concealed Carry Weapon Permit fee should be based upon comparability with other
communities.
K. Comparability with Other Communities
In setting user fees, the City will consider fees charged by other agencies in accordance with the
following criteria:
1. Surveying the comparability of the City's fees to other communities provides useful background
information in setting fees for several reasons:
a. They reflect the "market" for these fees and can assist in assessing the reasonableness of San
Luis Obispo’s fees.
b. If prudently analyzed, they can serve as a benchmark for how cost-effectively San Luis Obispo
provides its services.
2. However, fee surveys should never be the sole or primary criteria in setting City fees as there are
many factors that affect how and why other communities have set their fees at their levels. For
example:
a. What level of cost recovery is their fee intended to achieve compared with our cost recovery
objectives?
b. What costs have been considered in computing the fees?
c. When was the last time that their fees were comprehensively evaluated?
d. What level of service do they provide compared with our service or performance standards?
e. Is their rate structure significantly different than ours and what is it intended to achieve?
3. These can be very difficult questions to address in fairly evaluating fees among different
communities. As such, the comparability of our fees to other communities should be one factor
among many that is considered in setting City fees.
Page 444 of 454
2025-27 Financial Plan
FY 2026-27 Budget Supplement
June 2, 2026
Recommendation
•Adopt a Draft Resolution entitled,“A Resolution of the City Council of
the City of San Luis Obispo,California,approving the Fiscal Year
2026-27 Budget”and approve the allocations as stated in the Budget
Supplement document;and
•Confirm or modify user fee cost recovery goals to be used in the FY
2026-27 user fee study;and
•Receive a status update on the San Luis Obispo Museum of Art’s
(SLOMA)progress related to the City’s Phase 1 grant.
City Manager Message
Significant optimism, despite considerable
uncertainty
•Major infrastructure projects completed or
nearing completion
•Notable progress across programs,
operations, and community initiatives
•Advancements toward RHNA goals and
support for hundreds of supportive housing
units
City Manager Message
FY 2026-27 Budget Supplement reflects continued caution and planning for our future.
Long-term forecast shows a deficit beginning FY 2027-28, driven largely by operating a fifth fire station.
Economy performing better than expected, but cautious outlook remains
Proactive steps underway to reduce future impacts:
•$1.1M in net General Fund expenditure reductions across departments
•Some position reductions, with no layoffs
•Aligning costs with service levels (“right-sizing”)
•Constraining budget growth
•Modest new spending for emerging needs
•Clear justification required for any growth
Introduction
Fund Budget
General Fund $126,252,275
Water Fund 34,609,926
Sewer Fund 28,169,737
Parking Fund 10,300,258
Transit Fund 14,461,345
Other Funds 10,949,203
Total $224,742,744
General Fund Changes – Financial Plan to Supplement
(millions)Financial Plan Supplement Change
Total Revenue $120.6 $121.8 +$1.2
Total Expenditures 120.8 126.3 +5.5
Revenue - Expenditures (0.2)(4.4)(4.2)
Use of Fund Balance 0.2 5.4 +5.2
Surplus / (Deficit)$0.0 $0.9 +$0.9
FY 2026-27
General Fund Long-Term Forecast
(millions)FY 2025-26 FY 2026-27 FY 2027-28 FY 2028-29
Total Revenue $117.8 $121.8 $125.2 $129.5
Total Expenditures 127.3 126.3 125.7 129.4
Revenue - Expenditures (9.5)(4.4)(0.5)0.1
Use of Fund Balance 9.5 5.4 --
Surplus / Deficit $0.0 $0.9 ($0.5)$0.1
Financial Plan
Budget Reductions
*Public safety (Police, Fire) reductions to be re-allocated to overtime for no net savings
Inflationary Cost Increases
Process Changes
•No across the board inflationary
adjustments allowed
•Departments substantiated all cost
increases with formal requests
Fund Cost FTE
General Fund $344,318 0.00
Water Fund 655,269 0.00
Sewer Fund 192,500 0.00
Parking Fund 80,867 0.00
Transit Fund 258,612 0.00
Total $1,531,566 0.00
Significant Operating Budget Changes
Fund Ongoing One-time Total FTE
General Fund $197,323 $100,000 $297,323 -
Water Fund 10,000 148,500 158,500 +0.50
Sewer Fund 8,000 -8,000 +0.50
Parking Fund 14,731 -14,731 (0.50)
Transit Fund ----
Total $230,054 $248,500 $478,554 +0.50
Major City Goals: 86% of tasks on plan
•107 tasks complete or on plan with no changes recommended
•17 tasks with language and/or timeline changes; one task no
longer recommended
•No significant issues with recommended workplans
Staff recommendations on changes to MGC language and timelines
CIP Adjustments Due to Project Readiness
Aligning budgets with anticipated project delivery
Construction Funding Reallocation:
•Police Station Tenant Improvements (1042 Walnut)
Reallocated to:
•Righetti Park Bridge Abutments
•Storm Drain Project
•California & Taft Roundabout
•Replacements of Ped Crossing Improvements
CIP Highlights
Transportation
•2026 Roadway Sealing Project
•California & Taft Roundabout
•Downtown Pedestrian Crossing Improvements
•Vision Zero Program Implementation
•Downtown Transit Center Rehabilitation design
Recreation Facilities
•Righetti park
•Golf course pro shop
•Devaul Ranch playground
•Ludwick Community Center maintenance
Investments in Downtown
•Sidewalk replacement and cleaning
•Mission Plaza pergola replacement
•Downtown Banners and Signs
•Big Belly trash can upgrades
SLOMA Grant Update
•Phase 1 requirements complete
•Secured 100% of construction funds
•Approved entitlements and permits
•Development of Phase 2 fundraising plan
& 3-year operating forecast
•Staff to return with FY 2025-26 Year End
Budget Report to seek direction on potential
Phase 2 grant funding
User Fee Cost Recovery Goals
•Per Policy, staff will do a formal User Fee Study in FY 2026-27
•Council most recently reviewed and adopted the User Fee Cost Recovery Goals
policy in June 2025
•Summary of policy:
•Speaks more broadly to factors that favor low vs. high-cost recovery levels
•Also identifies cost recovery levels for specific fee types
•Development review
•Recreation programs
•Services supporting sustainability goals
•Specifies specific services that should be charged at low cost-recovery
Recommendation
•Adopt a Draft Resolution entitled, “A Resolution of the City Council of
the City of San Luis Obispo, California, approving the Fiscal Year
2026-27 Budget” and approve the allocations as stated in the Budget
Supplement document; and
•Confirm or modify user fee cost recovery goals to be used in the FY
2026-27 user fee study; and
•Receive a status update on the San Luis Obispo Museum of Art’s
(SLOMA) progress related to the City’s Phase 1 grant.
Appendix
User Fee Cost Recovery Goals
User Fee Cost Recovery Goals
•Factors favoring low cost recovery levels
•No intended relationship between the amount paid and the benefit received
•Collecting fees is not cost‐effective or will significantly impact the efficient delivery of the service
•No intent to limit the use of (or entitlement to) the service
•Service is non‐recurring, cannot reasonably be planned, and is not readily available from a private sector source
•Collecting fees would discourage compliance with regulatory requirements
•Factors favoring high cost recovery levels
•Service is similar to services provided through the private sector
•Other private or public sector alternatives could provide the service
•Ensure equity and demand management
•The use of the service is specifically discouraged.
•Service is regulatory in nature and voluntary compliance is not expected to be the primary method of detecting
failure to meet regulatory requirements
User Fee Cost Recovery Goals
Recreation Programs
High: Adult athletics, banner permit
applications, major commercial film permit
Mid: Camps, childcare, classes
Low: Aquatics, community gardens, minor
commercial film permit, skate park, Parks &
Recreation sponsored events, youth sports,
teen services, senior services
Services Supporting
Sustainability Goals
Certain building permits at 50% cost recovery
Pedicab fees at 50% cost recovery
Development Review
Generally high cost recovery
Building permit plan check
Low Cost Recovery
Police patrol & fire suppression
Support for public facilities that provide a
communitywide benefit
Social service programs & economic
development activities
Appealing planning decisions
Budget Reductions by Department
Administration & IT
Category Net Reduction
Staffing $40,697
Contract Services 46,760
Travel & Training 11,500
Misc. Operating 76,743
Total $175,700
City Attorney’s Office
Category Net Reduction
Staffing $32,003
Contract Services 26,000
Travel & Training -
Misc. Operating 2,850
Total $60,853
Community Development Department
Category Net Reduction
Staffing $58,450
Contract Services 101,350
Travel & Training 4,825
Misc. Operating 5,500
Total $170,125
Finance Department
Category Net Reduction
Staffing $-
Contract Services 24,335
Travel & Training 1,500
Misc. Operating 4,100
Total $29,935
Fire Department
Category Net Reduction*
Staffing $453,246
Contract Services -
Travel & Training -
Misc. Operating -
Total $453,246
*Public safety reductions to be re-allocated towards overtime budgets
Human Resources Department
Category Net Reduction
Staffing $-
Contract Services 46,200
Travel & Training -
Misc. Operating 2,000
Total $48,200
Police Department
Category Net Reduction*
Staffing $123,133
Contract Services -
Travel & Training -
Misc. Operating -
Total $123,133
*Public safety reductions to be re-allocated towards overtime budgets
Parks & Recreation Department
Category Net Reduction
Staffing $28,609
Contract Services 12,963
Travel & Training 10,200
Misc. Operating 38,270
Total $90,042
Public Works Department
Category Net Reduction
Staffing $83,981
Contract Services 238,550
Travel & Training 9,945
Misc. Operating 173,764
Total $506,240
Utilities Department (General Fund)
Category Net Reduction
Staffing $-
Contract Services 6,000
Travel & Training -
Misc. Operating 500
Total $6,500
Major City Goal Work Program Updates
SOBC Detail – General Fund
Item Cost FTE
Pilot – Statistically Valid Survey $40,000 0.00
User Fee Study 60,000 0.00
Fire Mechanic Helper Reclassification 12,578 0.00
Cellebrite Software Upgrade 9,745 0.00
Mediation Services 30,000 0.00
Body Worn and In Car Camera Software 95,000 0.00
Vehicle Telematics 38,000 0.00
Electrical Panel Inspections 12,000 0.00
TOTAL $297,323 0.00
SOBC Detail – Water Fund
Item Cost FTE
Vehicle Telematics $10,000 0.00
Water Treatment Plant Coverage 148,500 0.00
Utilities Special Projects Manager -0.50
TOTAL $158,500 0.50
SOBC Detail – Sewer Fund
Item Cost FTE
Vehicle Telematics $8,000 0.00
Utilities Special Projects Manager -0.50
TOTAL $8,000 0.50
SOBC Detail – Parking Fund
Item Cost FTE
Parking Compliance Officer Conversion $14,731 (0.50)
TOTAL $14,731 (0.50)
Unfunded Initiatives (non-exhaustive list)
Item Estimated Cost
Opioid settlement funding fiscal cliff $0.1M
Development impact fee study TBD
Police department staffing study implementation 2.5M
Public Works staffing study implementation 0.3M
Potential rental registry TBD
Cal Poly fire needs TBD
Fire Hazard Severity Zone map implementation TBD
Additional investments in downtown TBD
Oracle ERP upgrade / replacement TBD
CDD Revenue Trend
$0.0M
$0.5M
$1.0M
$1.5M
$2.0M
Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26
Basis for FY 2025-26 Budget