Title
Fiscal Year 2026 Preliminary Year-End Financial and Performance Measures Report as of June 30, 2026
Staffreport
SUMMARY AND RECOMMENDATIONS
Staff recommends that the City Council Finance Committee review the Fiscal Year FY 2026 (FY 2026) Year-End Financial and Performance Measures Report as of June 30, 2026. This report is for information only.
BACKGROUND
The City Council adopted the FY 2026-27 Biennial Budget for General Fund, Enterprise and Internal Service Funds, and Parking Fund on June 16, 2025. The amended City budget for FY 2026 was adopted on April 6, 2026. The approved budgets are the annual expenditure and resource allocation plans guiding and ensuring implementation of City Council policies and priorities. The budget implements the vision and direction for the broad range of services meeting the needs of the community in accordance with City Council policy.
This financial review as of June 30, 2026, provides the preliminary year-end budget update to the Finance Committee for the prior fiscal year and an update on performance measures. Analysis of the revenues collected and all expenditures through June 30, 2026, measures operational adherence to the budgetary allocation plan. The results presented should be considered preliminary and are subject to final adjustments and the annual audit process, which will result in an Annual Comprehensive Financial Report (ACFR). Upon completion, the ACFR will be presented to the Finance Committee and City Council for acceptance at a later date.
DISCUSSION
The FY 2026 Amended Budget incorporates estimated revenues and planned expenditures for all funds. The attached FY 2026 Preliminary Year-End Financial Report provides the revenue and expenditure summary for the General, Enterprise, and Internal Service Funds, as well as the Parking Fund. The detailed discussion offers comparisons to the prior year and focuses on variances from the revenue and expenditure plans and allocations contemplated in the budget. As noted, all results presented are preliminary and subject to change pending final adjustments and completion of the ACFR.
General Fund
The General Fund finances the operations of the City having no special or dedicated revenue sources and pays for basic municipal services. The amended FY 2026 General Fund budget projects revenues totaling $149.4M and expenditures totaling $165.6M including purchase order encumbrances from FY 2025, approved carryover amounts, and City Council approved appropriation amendments.
Revenue in FY 2026 totals $150.2M, approximately 101% of the amended budget of $149.4M and $2.5M greater than revenue in FY 2025. Preliminary year-end expenditures of $154.3M amount to 93% of the budget and 0.5% or $0.7M greater than expenditures in FY 2025. Both revenues and expenditure totals were closely in line with the prior year.
A detailed review of revenue and expenditure variances is presented.
General Fund Revenue
• Sales/Transaction and Use Taxes (102% of the amended revenue budget was collected compared to 98% in FY 2025). Sales/Transaction and Use Tax estimates were reduced by $2.8M or 5% to $52.1M at midyear due to an uncertain economy, an increase in consumer spending on (non-taxable) services, and a sales tax reporting correction from one of the City’s sales tax remitters. Overall, actual revenue at year-end is $1.2M above budget, and more than prior year actuals by $1.3M.
• Property Tax (100% of the amended revenue budget was collected compared to 103% in FY 2025). Actual Property Tax revenue came in at $33.7M, which is roughly $1M or 3% higher than revenue collected in FY 2025. Year-over-year growth is consistent with the long-term trend.
• Property Transfer Taxes (84% of the amended revenue budget was collected compared to 93% in FY 2025). $8.4M was collected in FY 2026, which is $0.2M more than FY 2025. This tax is highly volatile, relying on changes in property ownership. The impact of high interest rates, limited housing supply, and persistent economic uncertainty continue to impact changes in ownership turnover.
• Utility Users Tax (95% of the amended revenue budget was collected compared to 101% in FY 2025). Actual revenue of $13.4M was approximately $0.7M less than actual revenue in FY 2025, though Utility Users Tax receipts can sometimes lag as remitters have thirty days to pay for the month prior. As in prior years, the City continues to see declines in the cable tv and telephone categories.
• Other Tax (89% of the amended revenue budget was collected compared to 83% in FY 2025). Actual revenue includes $0.8M of transient occupancy tax (TOT) for FY 2026 that was $0.3M higher than collected in the prior year.
• Charges for Services (107% of the amended revenue budget was collected compared to 102% in FY 2025). Charges for Services exceeded the estimate of $3.9M by $0.2M and a year-over-year revenue increase of $1.4M due to implementation of the recently completed fee study and enhanced Recreation programming.
• Interest & Property Income (154% of the amended revenue budget was collected compared to 192% in FY 2025). Actual interest income was $2.3M better than planned due to higher investment rates yielding greater returns, and active cash flow management as the City holds more of its assets in higher yielding investments as well as maturing securities to meet liquidity requirements. Rental income was in line with budget.
• Fines, Fees & Forfeitures (-58% of the amended revenue budget was collected compared to 197% in FY 2025). The City was able to obtain voluntary compliance on a long-standing case and reversed code compliance citations, including some citations issued in prior years that impacted this revenue line item.
• Franchise Fees (104% of the amended revenue budget was collected compared to 106% in FY 2025). The Franchise Fee revenue budget of $7.5M came in at $7.8M led by refuse, and Ora Loma fees.
• Licenses & Permits (100% of the amended revenue budget was collected compared to 94% in FY 2025). Revenue collection was $5.3M, $0.8M greater than FY 2025, largely due to business license compliance efforts, granting an additional cannabis permit, and fee study implementation.
As reported in the attached Preliminary Year-End Financial Report, all other taxes and revenue receipts are in line with budgeted revenues. All financial results presented are estimates and subject to change pending final financial transactions and any adjustments associated with the annual audit and presentation of the ACFR.
General Fund Expenditures
The year-end expenditure total was $154.3M, 93% of the amended budget of $165.6M. General Fund expenditures were $0.7M greater when compared to the prior year. All categories were at or under budget. With the exception of salaries and benefits, funding for ongoing initiatives may carry over into the next year. Overall, expenditures were in line with expectations.
• Enterprise, Internal Service Funds, and Parking Fund
Four Enterprise Funds make up the City's business-type operations and are intended to fully recover costs through user fees: The Water Pollution Control Plant Fund, the Environmental Services Fund, the Shoreline Enterprise Fund, and the Storm Water Fund. Internal Service Funds also operate as business activities, exclusively supporting the City's internal operations and include Facilities Maintenance, Information Technology, Insurance Services, and Equipment Maintenance. The Parking Fund provides for parking meter and parking lot operations and maintenance at the Downtown Parking Structure. As noted, all financial results presented are preliminary and subject to change pending final entries and adjustments associated with the annual audit and presentation of the ACFR.
• Shoreline Enterprise, Revenues and Expenditures (138% of the revenue budget has been collected compared to 129% in FY 2025 and 70% of the amended expenditure budget compared to 73% in FY 2025). Shoreline revenue was $2.1M better than planned due to more interest revenue than anticipated related to Shoreline developer receivables that will be reconciled at the conclusion of bankruptcy proceedings.
• Shoreline Golf Operations, Revenues and Expenditures from the Monarch Bay Golf Course operations were in line with budget. Monarch Bay Golf Course expenditure budget is $8.2M and actuals were $5.8M. $1.5M in capital expenditures are still in progress.
• Internal Service Funds, Expenditures (78% of the expenditure budget compared to 74% in FY 2025). Internal service fund expenditures were in line with expectations. IT, Fleet, Equipment, and Facilities expenditures may vary year-over-year based on capital expenditures. Insurance services expenditures may vary based on claims/settlements.
• Parking Fund, Revenues and Expenditures (98% of the revenue budget has been collected compared to 114% in FY 2025 and 89% of the amended expenditure budget compared to 87% in FY 2025). Expenditures were in line with expectations. Operating revenue (less transfers) was $1.2M in FY 2026 compared to $1.1M in FY 2025.
Performance Measures
In FY 2024, the City of San Leandro began implementing performance measures as outlined by the Government Finance Officer Association’s best practices to tie budget allocations with performance objectives. During the budget process, each Department proposed specific performance measures to track progress against target performance objectives during that biennial budget period. Attachment B presents the actual results for FY 2026.
ATTACHMENTS
Attachment A - Preliminary Year-End Financial Report as of June 30, 2026
Attachment B - FY 2026 Performance Measures
Attachment C - FY 2026 Preliminary Year-End Financial Report Presentation
PREPARED BY
Felicia Silva, Assistant Finance Director
Tyler Hammond, Accountant II