Council hears fiscal midquarter report showing $816,918 structural deficit for FY27

City staff presented the city’s first-quarter financial benchmark and a fund-by-fund review at the Aug. 10 Pleasant Hill City Council meeting, saying revenues and expenditures are generally tracking to expectations but structural deficits remain that the council will need to address.

“Amy’s report really looks at how are we doing in comparison to what we budgeted,” Kristen, a city staff member, said as she introduced the staff analysis. The presentation showed revenues received at roughly 22.02% ($3,270,000 of $14,800,000) and expenditures (extended and encumbered) at about 22.75% for the quarter. The staff presentation noted timing differences — such as encumbrances for contracted services and capital purchases — that affect those percentages.

On the budget shortfalls, Kristen said the total structural operating deficit for FY27 was "816,918 was the actual structural operating deficit of the full budget for f y 27." She broke that number into fund-level detail: a remaining general-fund operating deficit of $332,558 after accounting for a $300,000 pilot prepayment from Dogwood and $72,000 in planned one-time expenditures; a transportation operating deficit of $20,023; a Marcus Fund deficit of $57,199 (staff previously proposed a one-time $25,000 transfer from the general fund); and the Walker Sewer Fund shortfall — roughly $423,000 — which staff said requires a rate study.

Staff said the Walker sewer rate study is nearly complete and the consultant is scheduled to present findings and recommendations to the council on Sept. 14 so members can consider rate adjustments to bring that fund into long-term equilibrium. The presentation also noted that some planned capital purchases cause individual line items to exceed the 25% benchmark without signaling programmatic overspending.