HomeMy WebLinkAboutStaff Report 2512-5697CITY OF PALO ALTO
CITY COUNCIL
Special Meeting
Monday, June 15, 2026
Council Chambers & Hybrid
5:30 PM
Agenda Item
A.Third Quarter Fiscal Year 2026 Financial Status Report
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City Council
Staff Report
From: City Manager
Report Type: INFORMATIONAL REPORT
Lead Department: Administrative Services
Meeting Date: June 15, 2026
Report #2512-5697
TITLE
Third Quarter Fiscal Year 2026 Financial Status Report
RECOMMENDATION
This report is informational and does not require action by the City Council.
EXECUTIVE SUMMARY
The purpose of this report is to provide the City Council with information on the financial status
of the City’s General Fund and Enterprise Funds through the end of the third (3rd) quarter of
Fiscal Year (FY) 2026 (January 1, 2026, through March 31, 2026). The figures presented in this
report are unaudited.
Third-quarter results for the General Fund are consistent with historical trends, and it is
expected that the fund will meet the adjusted budget. Staff will continue to review revenues
and expenditures against the budget and bring forward information, when available, regarding
budget-to-actual variances. As of the end of March, 67.4% of the adjusted revenue budget
(before operating transfers) was received and 75.3% of the adjusted expenditure budget
(including pre-encumbrances and encumbrances, before operating transfers) was spent.
Revenues typically trend lower than 75% in the third quarter primarily due to seasonality of the
City’s major tax revenues, specifically property tax and sales tax. Property and sales tax
revenues are received unevenly throughout the year, with property tax distributions from the
County occurring primarily in the second through fourth quarters. Sales tax revenues reflect
seven months of collections due to consistent timing lags in the State’s collection and
distribution process. Additional details regarding seasonality and timing are included in the
General Fund Property Tax and Sales Tax sections in this report.
General Fund expenditures through the third quarter are below the prior fiscal year and are
currently projected to remain within the FY 2026 Adjusted Budget. A portion of the year-over-
year decrease in salaries and benefits is attributable to timing and accounting allocation
differences related to pension and medical benefit costs rather than year-over-year reduction
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in operational expenditures. In FY 2025, certain employee benefit allocations were recognized
later in the fiscal year, whereas FY 2026 reflects a more consistent quarterly allocation
methodology. These timing differences are expected to normalize through year-end and are
not anticipated to materially impact total annual expenditure levels.
BACKGROUND
1, which reported the
financial status of major funds and the Capital Improvement Program as of the second quarter
(Q2) and recommended adjustments to the Adopted Budget. This third quarter financial report
covers financial activity for the period July 1, 2025 through March 31, 2026, and compares
results to the same period in the prior fiscal year and to the FY 2026 Adjusted Budget. In the
discussion of the major tax revenue categories below, staff generally indicates how each
category is trending compared to the adjusted budget. This report serves as a financial status
update and does not include any budgetary adjustments for FY 2026.
ANALYSIS
General Fund
rd Quarter Financial Report (Attachment A) contains a summary of major
General Fund revenues by source and expenditures by department and the comparison
between the FY 2026 Adopted Budget and Adjusted Budget. The Adjusted Budget column
includes prior year commitments that were carried forward into FY 2026 and the City Council
approved amendments to the FY 2026 Adopted Budget Year-to-Date (YTD).
Revenue Highlights for FY 2026 3rd Quarter YTD
1 February 23, 2026 Council Meeting Item #8, Report # 2512-5662:
https://recordsportal.paloalto.gov/WebLink/DocView.aspx?id=86652&dbid=0&repo=PaloAlto&searchid=40c482af
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$269.7 million. The net reduction is primarily driven by a $9.0 million decrease in Sales Tax and
a $1.3 million decrease in Property Tax, partially offset by increases in revenue from other
agencies (+$1.5 million), permits and licenses (+$0.4 million), and charges for services (+$0.2
million), along with (+$0.5 million) modest gains in business tax and other revenues. This
decrease includes reappropriations, encumbrances, and budget amendments. These changes
can be viewed on City’s website3.
rd Quarter Year-To-Date (YTD),
compared to the same period of the prior fiscal year. Revenues are expressed as a percentage
of the Adjusted Budget.
Table 1: General Fund Revenue
3 Budget Adjustments and Monitoring
Revenues FY 2026 Inc / (Dec) % change FY 2026 % FY 2025 %
Property Tax $41,741 ($2,185) -5.0% $72,327 57.7% $68,319 64.3%
Charges for Services 29,793 4,956 20.0% 44,499 67.0% 39,112 63.5%
Sales Tax 21,925 1,314 6.4% 27,377 80.1% 35,588 57.9%
Transient Occupancy Tax 18,619 1,310 7.6% 29,139 63.9% 28,345 61.1%
Utility User Tax 15,267 1,101 7.8% 21,437 71.2% 21,489 65.9%
Permits, Licenses and Other Fees 8,819 2,130 31.8% 11,065 79.7% 10,877 61.5%
Documentary Transfer Tax 6,599 1,185 21.9% 8,542 77.3% 8,550 63.3%
Business Tax 3,540 851 31.6% 6,738 52.5% 5,250 51.2%
All Other Revenue Sources 30,270 406 1.4% 40,869 74.1% 43,259 69.0%
Total Revenue $176,573 11,068 6.7% $261,993 67.4% $260,789 63.5%$165,505
6,689
5,414
29,864
2,689
24,837
17,309
14,166
$43,926
20,611
3rd Quarter Actuals Adjusted Budget
FY 2025
FY 2026 3rd Quarter YTD
(000's)
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Property Tax
At the close of the 3rd quarter, property tax revenue receipts were $41.7 million, or 57.7% of
the adjusted budget, and a decrease of 5.0% over the same period in the prior fiscal year due to
timing differences in recording revenue. Based on remittances received from Santa Clara
County, after adjusting for these timing differences the underlying property tax revenues
through April are 4.6% above prior year levels. Property tax revenues are received from the
County of Santa Clara during the second, third, and fourth quarters of the calendar year. The
compounded annual growth rate (CAGR) over the 5-year and 10-year periods for this revenue
source is 6.3% and 7.4%, respectively.
At the FY 2026 Mid-Year review, the property tax revenue estimate was reduced by $1.3
million, from $73.6 million to $72.3 million, to align with the County of Santa Clara’s secured
roll and assessed valuation data. With this adjustment, Property Tax revenues are still projected
to increase year over year, though at a more moderate level than the Adopted Budget. Based
on 3rd quarter results and County projections issued in May 2026, revenues are expected to
meet the revised year-end estimate.
A portion of Excess Educational Revenue Augmentation Fund (ERAF) distributions remains
subject to State audit findings on calculation methodology. Approximately 18% of Excess ERAF
is considered at risk. To mitigate these potential losses, the City budgets excess ERAF net of the
amount at risk and reserves at-risk amounts when received. The ERAF Reserve balance is $7.1
million as of June 30, 2025, with an additional contribution of approximately $1.5 million
anticipated in FY 2026 based on current estimates. As of the publication of this report, the
court judgment remains pending.
Due to the timing of sales tax collection and distribution by the California Department Tax and
Fee Administration (CDTFA), third quarter sales tax only reflects seven months of sales activity
(through January) and does not represent the full three quarters of the fiscal year. Actual year-
end performance will be known in August.
As of the third quarter, sales tax revenue totaled $21.9 million, 80.1% of the adjusted budget,
and a $1.3 million or 6.4% increase, compared to the same period in the prior fiscal year.
At the FY 2026 Mid-Year review, the sales tax revenue estimate was reduced by $9.0 million
(estimated $5 million ongoing and $4 million one-time), from $36.4 million to $27.4 million, to
reflect with an updated allocation methodology used by CDTFA, particularly affecting leasing
and new auto sales.
Year-to-date revenues reflect a higher percentage of the adjusted budget and are above prior
year levels. However, these results are influenced by the Mid-Year budget adjustment, timing
differences between sales activity and revenue distributions, and one-time prior period
adjustments associated with the revised allocation methodology, rather than a clear change in
underlying economic activity. The timing and implementation of these changes remain
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uncertain and will continue to affect both the level and timing of reported revenues during the
current fiscal year.
Transient Occupancy Tax (TOT)
rd quarter revenue estimates represent approximately
7.5 months of TOT receipts due to timing delays in receipts of up to 1.5 months. Reported
receipts through February are $20.2 million, a $1.8 million or 9.8% increase over the same
period in the prior year.
Utility User Tax (UUT)
rd quarter, a $1.1 million or 7.8% increase
over the prior fiscal year and 71.2% of the FY 2026 Adjusted Budget. The increase is primarily
driven by the FY 2026 adopted utility rate increases, normal fluctuation in utility consumption,
and billing cycles. Staff will continue to monitor collections throughout the remainder of the
fiscal year.
Documentary Transfer Tax
Business Tax
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The tax was effective in January 2023, with a discounted rate through January 2025 at 50% or
3.75-cents per square foot per month. The full rate was assessed starting January 2025 at 7.5-
cents per square foot per month. The tax has an annual cap of $0.5 million per business and
both the rate and the cap are increased by 2.5% annually beginning FY 2027. FY 2026
represents the full fiscal year in which the Business Tax is fully phased in at the voter approved
rate.
Charges for Services
rd quarter of FY
2026, revenues totaled $29.8 million, up by $5.0 million or 20.0% over the same period in the
prior fiscal year. The year-over-year increase was primarily driven by:
Zoning, inspection, and plan check fees: $2.2 million increase
Paramedic service fees: $1.8 million increase (reflecting the new first responder fee and
an increased number of transports)
Recreation, programming, drop-in admissions, golf tournament and driving range fees:
$0.7 million increase
Stanford communication and fire service fees: $0.5 million increase
Rental registry fee: $0.2 million increase
Permits, Licenses, and Other Fees
Expense Highlights for FY 2026 3rd Quarter YTD
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As of April 2026, the citywide vacancy was 117.50 positions or 10.6% vacancy rate. See Table 2
below for more detailed information regarding citywide vacancies by department. All
recruitments are subject to review and approval by the Hiring Review Committee and further
consideration of governmental efficiencies.
Table 2 Citywide Vacancies by Department
rd quarter of FY 2026,
compared to the same period in the prior fiscal year. Year-to-date expenditures are presented
as a percentage of the respective fiscal year’s Adjusted Budget.
Table 3: General Fund Expenditures
Department General Fund Other Funds Grand Total
Administrative Services Department 7.0 2.5 9.5
City Managers Office 1.0 0.0 1.0
Community Services Department 5.0 0.0 5.0
Fire Department 9.0 0.0 9.0
Human Resources Department 0.0 1.0 1.0
Information Technology Department 0.0 2.0 2.0
Library Services Department 6.0 0.0 6.0
Office of Transportation 4.0 1.0 5.0
Planning and Development Services 4.0 0.0 4.0
Police Department 13.0 0.0 13.0
Public Works Department 4.0 19.0 23.0
Utlities Department 0.0 39.0 39.0
Grand Total 53.0 64.5 117.5
Vacancy % 8.6% 13.0% 10.6%
Vacancy % (without Public Safety) 6.5%
Expenditures FY 2026 FY 2025 Inc/(Dec) % change FY 2026 % FY 2025 %
Police 44,243$ 45,946$ (1,703)$ -3.7% 58,966$ 75.0% 58,608$ 78.4%
Fire 44,959 43,900 1,059 2.4% 60,223 74.7% 56,530 77.7%
Community Services 31,800 29,290 2,510 8.6% 44,825 70.9% 42,821 68.4%
Public Works 18,751 17,355 1,396 8.0% 29,044 64.6% 27,735 62.6%
Planning & Development Services 17,527 17,133 394 2.3% 29,902 58.6% 29,336 58.4%
Library 9,871 9,701 170 1.8% 13,098 75.4% 13,144 73.8%
Administrative Services 8,613 8,723 (110) -1.3% 12,039 71.5% 12,267 71.1%
All Other Departments 21,458 31,167 (9,709) -31.2% 42,251 50.8% 53,370 58.4%
Total Expenditures 197,222$ 203,215$ (5,993)$ -2.9% 290,348$ 67.9% 293,811$ 69.2%
FY 2026 3rd Quarter YTD
(000's)
3rd Quarter Actuals Adjusted Budget
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due to the timing of applying employee contributions and related benefit cost allocations. In FY
2025, these adjustments occurred in the fourth quarter, whereas FY 2026 reflects a quarterly
allocation approach to better distribute costs during the fiscal year. These timing changes are
not expected to significantly affect overall year-end expenditure comparisons. Overall General
Fund projected expenses for FY 2026 are anticipated to come within or under the adjusted
budget.
Community Services expenditure increased by $2.5 million, or 8.6%, compared to the same
period in the prior fiscal year. The increase was primarily driven by higher costs in contract
services ($1.2 million), facility maintenance and security ($500K), IT support and maintenance
($271K), grant and subsidies ($210K), liability insurance ($167K), program and project costs
($140K), and other general expenses by ($127K). Of these expenditure categories, contract
services represent the largest increase, primarily driven by the timing of payments related to
golf course management fees ($700K) and landscaping contract costs ($490K), which were
recorded in the fourth quarter of the prior fiscal year rather than the third quarter.
Public Works expenditures increased by $1.4 million, or 8.0%, compared to the same period in
the prior fiscal year. This increase was primarily driven by salaries and wages ($643K) and
contract services ($1.1 million), which includes facility maintenance, repair, and security and
other contract services. Additional increases occurred in indirect charges for liability insurance
($153K), IT support and maintenance ($167K), and vehicle equipment maintenance services
($107K). These increases were partially offset by lower pension employer costs ($391K),
reduced gas sales to City departments ($172K), a lower vehicle replacement allocation($54K),
and decreased construction material costs ($65K).
Planning and Development Services expenditures increased primarily due to expanded
planning activities associated with the new San Antonio Road Area Plan and the
implementation of the rental registry program.
Library expenditures increased by $263K overall, partially offset by a $94K reduction in salaries
and benefits due to lower pension and medical contribution costs.
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Administrative Services experienced changes primarily driven by lower salaries and benefits
due to reduced pension and medical contribution costs, partially offset by an increase in direct
and indirect charges.
All Other Departments expenditures decreased $9.7 million, or 31.2%, compared to the same
quarter in the prior fiscal year. The decline is primarily attributable to Non-Departmental
variances. Expenditure increases totaling $500K across the City Manager, City Clerk, and City
Attorney offices were offset by a decrease in the Office of Transportation.
Non-Departmental expenditures decreased by $9.7 million, or 76.4 %, compared to the
previous fiscal year, driven by the following:
Contract Services (Legal fees) decreased by $2.8 million compared with the previous
year. This decrease is attributable to the settlement in the Green v. City of Palo Alto
litigation, in which the payout of attorney‘s fees and refunds under the settlement
agreement was completed earlier than originally anticipated.
Other Contract Services decreased by $0.5 million due to non-recurring expenditures
in FY 2025, including November 2024 election costs and the completion of the
mobile mental health outreach initiative in FY 2025.
General Expenses decreased by $6.2 million primarily due to the conclusion of gas
customer refunds related to Green v. City of Palo Alto, which were fully disbursed in
March 2025. Additionally, expenditures were reduced by $200K due to a decrease in
the Cubberley base rent.
Police and Fire the total combined expenditures for the Police and Fire Departments accounted
for approximately 45.0% of total General Fund expenditures through the 3rd quarter of FY 2026.
The table below summarizes salary and overtime expenditure for this period. A detailed
analysis of net overtime costs for both departments is provided in Attachment B.
Table 4: Police and Fire
FY 2026 FY 2025 Inc(Dec) % change FY 2026 % FY 2025 %
Police - Salaries $16,238 $16,454 (216)$ -1.31% $23,730 68.4% $23,194 70.9%
Police - Overtime 2,239 2,678 (439) -16.39% 1,173 190.9% 1,099 243.7%
Total Police 18,477 19,132 (655) -3.42% 24,903 74.2% 24,293 78.8%
Fire - Salaries 17,076 15,079 1,997 13.24% 21,674 78.8% 19,731 76.4%
Fire - Overtime 3,096 4,449 (1,353) -30.41% 4,939 62.7% 5,217 85.3%
Total Fire 20,172 19,528 644 3.30% 26,613 75.8% 24,948 78.3%
Total Public Safety
Salaries & Overtime 38,649$ 38,660$ (11)$ -0.03% 51,516$ 75.0% 49,241$ 78.5%
Expenditures
3rd Quarter Actuals Adjusted Budget
Salaries and Overtime Expense
FY 2026 3rd Quarter YTD
(000's)
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Police Department Overtime. As of the end of the third quarter of FY 2026, the Department
held 13 vacancies (9% of 139 total FTEs), including 10 police officers, two dispatchers, and one
community service officer (CSO). Benefited leave totaled 5,536 hours for the period, with 19
employees unavailable for ten or more shifts. Overtime is primarily used to mitigate staffing
shortages due to vacancies, training, and leave, or to support surge requirements for major
incidents. Overtime is also used to support special events and work related to the retail theft
grant. These costs are driven predominantly by police officer staffing needs. Analysis is
included in Attachment B.
Fire Department Overtime. The current deployment model requires 25 positions each day to
keep Fire Engines and Ambulances operational. Overtime is primarily driven by backfilling
vacancies to maintain minimum daily staffing. Any gaps resulting from vacancies, injuries,
training, or leave are covered through overtime. During the third quarter of FY 2026, 10
firefighters were in the Fire Academy, requiring continued overtime backfill. Additionally, all
Strike Team deployments are paid as overtime and are fully reimbursable by the State; six
deployments have occurred in FY 2026 to date. The midyear overtime budget was adjusted to
reflect reimbursement revenue from Strike Teams and the Tri-City agreement for Fire Station 8
(Foothills) staffing during fire season. Analysis is included in Attachment B.
General Fund Budget Stabilization Reserve (BSR) Balance
5 the Budget Stabilization Reserve (BSR) was $53.8 million at the end of 3rd
quarter and be maintained through year end. This amount is $4.1 million below the City
Council’s recommended target of $57.9 million, which represents 18.5% of the General Fund
adopted operating expenditure. Per policy, the City maintains a BSR balance within a range of
15% to 20% of annual operating expenditures, with a target level of 18.5%. The FY 2027
Proposed Budget BSR balance is projected to be $53.7 million, which is 17.3% of expenditures
and below the City Council’s recommended target level of 18.5% by $3.5 million.
Enterprise Funds
5 City Council Special Meeting, February 23, 2026, Agenda Item 8, Staff Report# 2512-5662
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Table 5: Enterprise Funds Change in Net Position
Water Fund increased by $2.6 million, or 34.7%, from the prior fiscal year. This increase was
primarily driven by a $2.8 million increase in operating revenues, mainly from higher customer
sales. The increase in customer sales reflects a 10.0% overall rate adjustment for residential and
commercial customers, effective July 1, 2025, partially offset by a 3.8% decrease in overall
consumption. Operating expenses remained relatively stable compared to the prior fiscal year.
The decrease in consumption contributed to lower utility purchase costs, which were partially
offset by increases in other operating expenses, including operations and maintenance.
Electric Fund decreased by $7.2 million, or 16.9%, compared to the prior fiscal year. The
decrease was primarily driven by higher operating expenses and increased transfer out,
partially offset by increased operating and non-operating revenues.
Operating expenses increased by $14.9 million, primarily due to $11.0 million in higher
commodity purchases, driven by increased Resource Adequacy capacity costs, Energy Market
Activity, and higher Western power purchase costs. These increases were partially offset by
lower NCPA-related costs, including pooling and facilities, as well as lower transmission costs.
Additional increases were driven by higher administrative and general expenses and operations
and maintenance expenses.
Operating revenues increased by $8.5 million, mainly due to a $9.9 million increase in customer
sales, attributed to the electric rate increase of 6% effective July 1, 2025, and higher
commercial and residential usage. This was partially offset by a decrease in other operating
revenues, primarily due to lower Renewable Energy Credit sales, partially offset by higher
Resource Adequacy capacity sales. Both are market driven and subject to fluctuations.
Increase
Funds FY 2026 FY 2025 (Decrease) % Inc (Dec)
Water 10,273$ 7,624$ 2,649$ 34.7%
Electric 35,171 42,328 (7,157) -16.9%
Fiber Optic 534 1,028 (494) -48.1%
Gas 10,902 8,445 2,457 29.1%
Wastewater Collection 6,123 2,762 3,361 121.7%
Wastewater Treatment 12,528 2,754 9,774 354.9%
Refuse 1,508 1,419 89 6.3%
Storm Drainage 1,908 1,724 184 10.7%
Airport (921) (995) 74 -7.4%
Total Change in Net Position $78,026 $67,089 $10,937 16.3%
FY 2026 3rd Quarter YTD
3rd Quarter Actuals
(000's)
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Transfer Out increased by $1.8 million, primarily due to $1.2 million higher transfers to the
General Fund associated with grid modernization asset values, as well as transfers to Capital
Project and Vehicle Funds.
Fiber Optic Fund decreased by $0.5 million, or 48.1%, compared to the same period in the prior
fiscal year. This decrease was primarily due to a $0.3 million decline in operating revenues,
mainly from lower customer sales associated with customer disconnections due to move-outs
and business closures, and a $0.2 million increase in operating and maintenance expenses,
primarily driven by higher labor and administrative costs as staff continue to build out Fiber to
the Premises initial pilot area.
Gas Fund increased by $2.5 million, or 29.1%, compared to the same period in the prior fiscal
year. The increase was primarily driven by higher operating and non-operating revenues, and
lower transfers partially offset by higher operating expenses.
Wastewater Collection Fund increased by $3.4 million, or 121.7%, compared to the same
period in the prior fiscal year. This increase was primarily driven by higher operating revenues,
partially offset by increased operating expenses.
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Water Quality Control Plant. These costs include operating requirements, debt service, and
minor capital improvements. In addition, administrative and general expenses, as well as
depreciation, also increased.
Wastewater Treatment Fund increased by $9.8 million, or 354.9%, compared to the prior fiscal
year. This increase was primarily driven by advance billings to the City of Mountain View and
Valley Water for Advanced Water Purification System project, along with normal billing and
expenditure fluctuations and other routine operational variances. However, this increase does
not reflect a true change in net income, as the fund operates as a pass-through for partner
billings, including advance billings that are subject to year-end true-up.
FISCAL/RESOURCE IMPACT
STAKEHOLDER ENGAGEMENT
ENVIRONMENTAL REVIEW
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ATTACHMENTS
Attachment A: FY 2026 3rd Quarter Financial Report
Attachment B: FY 2026 3rd Quarter Public Safety Overtime Analysis
APPROVED BY:
Lauren Lai, Administrative Services Director
ATTACHMENT A
CITY OF PALO ALTO
GENERAL FUND FIRST QUARTER FINANCIAL REPORT
FISCAL YEAR ENDING JUNE 30, 2026
(in thousands)
BUDGET ACTUALS (as of 03/31/2026)
Adopted Adjusted Pre % of Adj
Categories Budget Budget Encumbr Encumbr Actual Budget`
Revenues & Other Sources
Sales Tax 36,377 27,377 - - 21,925 80.1%
Property Tax 73,627 72,327 - - 41,741 57.7%
Transient Occupancy Tax 29,139 29,139 - - 18,619 63.9%
Documentary Transfer Tax 8,542 8,542 - - 6,599 77.3%
Utility Users Tax 21,437 21,437 - - 15,267 71.2%
Business Tax 6,488 6,738 3,540 52.5%
Other Taxes and Fines 780 780 - - 555 71.2%
Charges for Services 44,293 44,499 - - 29,793 67.0%
Permits & Licenses 10,671 11,065 - - 8,819 79.7%
Return on Investment 3,742 3,742 - - 2,941 78.6%
Rental Income 16,448 16,448 - - 11,999 73.0%
From Other Agencies 1,830 3,308 - - 2,100 63.5%
Charges To Other Funds 15,547 15,547 - - 11,891 76.5%
Other Revenues 785 1,045 - - 782 74.8%
Total Revenues 269,706 261,993 - - 176,573 67.4%
Operating Transfers-In 31,459 32,127 - - 24,095 75.0%
Encumbrances and Reappropriation 12,203 25,934 - - - 0.0%
Total Sources of Funds 313,369 320,053 - - 200,668 68.2%
Expenditures & Other Uses
City Attorney 5,094 5,859 36 790 3,825 79.4%
City Auditor 995 1,412 2 813 576 98.5%
City Clerk 1,542 1,618 0 154 1,039 73.7%
City Council 550 596 40 41 374 76.1%
City Manager 5,356 5,693 24 231 4,341 80.8%
Administrative Services 11,831 12,039 5 637 8,613 76.9%
Community Services 43,495 44,825 134 4,683 31,800 81.7%
Fire 59,966 60,223 318 433 44,959 75.9%
Human Resources 5,655 5,318 48 101 4,173 81.3%
Library 12,925 13,098 129 403 9,871 79.4%
Office of Emergency Services 1,768 1,922 36 326 1,298 86.4%
Office of Transporation 3,464 4,831 0 880 2,832 76.8%
Planning and Development Services 24,768 29,902 193 4,890 17,527 75.6%
Police 58,203 58,966 1 277 44,243 75.5%
Public Works 25,662 29,044 96 5,090 18,751 82.4%
Non-Departmental 12,431 14,998 135 552 3,002 24.6%
Total Expenditures 273,707 290,348 1,196 20,300 197,222 75.3%
Operating Transfers-Out 6,383 6,383 - - 4,787 75.0%
Transfer to Infrastructure 33,057 34,028 - - 25,521 75.0%
Total Use of Funds 313,147 330,759 1,196 20,300 227,530 75.3%
Net Change to BSR 221 (10,705)(26,862)
Budget Amendments in the Fund Authorized by Council thru 3/31/26
FY2026 Budget amendments to reduce GF appropriations
by approximately $6.2m 66
General Fund amendment related to ordinances (96)
CMO Oversized Vehicles Phased Approach (305)
Mid year budget adjustments 157
with PAUSD.(427)
Fire watch services at City hall (81)
Mid year budget adjustments 110
Mid year budget adjustments (50)
Forecast ( November 2025)(1,300)
report (9,000)
Total Budget Amendments Authorized by Council (10,926)
Total Budget Amendments Authorized by Council - -
BSR Balance 58,768 53,842
BSR % of Adopted Total Use of Funds
2024 2025 2026 Q3
POLICE DEPARTMENT
Overtime Expense
Adopted Budget (A)$1,028,988 $1,098,939 $1,173,110
Modified Budget (B)1,028,988 1,098,939 1,173,110
Net Overtime Cost - see below 1,160,290 1,868,684 (288,999)
Variance to Budget (131,303) (769,745) 1,462,109
Overtime Net Cost
Actual Expense $3,467,691 $3,181,061 $2,238,811
Less Reimbursements
Other Program Reimbursements 259,747 - 626,317
- -
(C)
(A)
Department Vacancies (number of days)
Workers' Compensation Cases
Department Disabilities (number of days)
FIRE DEPARTMENT
Overtime Expense
(D)
(E)
Overtime Net Cost
(D)
Department Vacancies (number of days)
Workers' Compensation Cases
Department Disabilities (number of days)
NOTES:
(A)The FY 2026 Police Department budget did not include any new positions.
(B)Police Department adopted budget has not been adjusted in FY 2026.
(C)Includes Animal Control Services contract with Los Altos and Los Altos Hills.
(D)The FY 2026 Fire Department budget was increased by 3.0 Fire Captains and 7.0 Single Role EMS Division positions.
(E)As part of the FY 2026 Mid-Year Review, City Council approved actions that result in a Fire Department overtime budget of $4.9 million.
Attachment B
Public Safety Departments
Overtime Analysis for Fiscal Years 2024 through 2026