Vacaville finance staff present Budget 101 and warn reserves could fall below policy by 2030

Finance Director Ken Matsumia, Assistant Director Lesley Hoover and Budget Manager John Colette presented a Budget 101 overview and a five‑year fiscal forecast to the Vacaville City Council, outlining the city’s major revenue sources, expenditure drivers and the near‑term calendar for budget study sessions and adoption.

Matsumia told the council the city’s total budget (excluding the successor agency) is about $295 million and that general fund revenues total roughly $149.6 million. He said public safety consumes the majority of the general fund—about 67%—with the police department at about 38% and fire at about 29% of the general fund.

The presentation highlighted that property tax and sales tax are the city’s largest general fund revenue sources and summarized the five‑year forecast showing expenses outpacing revenues from FY24 through FY30, even when staff’s current cost‑savings measures are carried forward. “With cost savings implemented in fiscal year 26, the general fund reserve is projected to be at 18% in FY27, and if we strip out those cost savings the reserve drops to 14%,” staff said. The forecast showed reserves falling further by FY29–30 and, in a status‑quo scenario without cost savings, potentially going negative in later years.

Council members asked technical questions about the drivers of property tax growth (staff said growth is mainly from new development rather than only the 2% CPI increase) and about the size and timing of cost‑savings currently built into the budget (staff said a 2.5% cost‑savings measure is in place for the current year and is carried forward). Residents during public comment urged clearer public reporting on Measure M expenditures, asked the city to review landscape and lighting district assessments, and suggested revisiting post‑employment health‑benefit (OPEB) structures to control long‑term liabilities.

Staff said the formal budget calendar includes a Q3 update May 26, a first budget study session on May 12, a second study session on June 9 (including draft CIP review) and final budget adoption scheduled for June 23, 2026.

What happens next: Council members will continue study sessions in May and June; staff returns with updated revenue figures, the five‑year forecast and department presentations before final adoption in late June.