HomeMy WebLinkAboutCC 2026-01-13_09d FY 25-26 First Quarter Financial Status ReportItem 9.d.
MEMORANDUM
TO: City Council
FROM: Nicole Valentine, Director of Administrative Services
SUBJECT: Fiscal Year 2025-26 First Quarter Financial Status Report
DATE: January 13, 2026
RECOMMENDATION:
Receive and file the Fiscal Year 2025-26 First Quarter Financial Status Report.
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
Preparation of the Fiscal Year (FY) 2025-26 First Quarter Financial Status Report (the
“Q1 Report”) requires staff time within the existing work plan and budget for the
Administrative Services Department. At the end of the first quarter, FY 2024-25 revenues
for the Consolidated General Fund were $3 million, or two percent (2%), lower than the
Budget Target (“Target”). Actual Expenditures were $8.3 million, or three percent (3%),
lower than the Budget Target (“Target”).
BACKGROUND:
Each Fiscal Year, the City Council adopts a budget, which commits go vernment
resources and services to accomplish the City’s mission of making Arroyo Grande the
best place possible for everyone who lives, works, and visits here. The Q1 Report is the
first of four financial performance reports that staff will present to Council during the 2025-
26 fiscal year. The purpose of the FY 2025-26 Q1 Report is to:
Compare first quarter revenues received and expenditures incurred to the first
quarter of the prior year and to the budgeted Target to determine the City’s financial
performance;
Provide explanations for key account variances and identify any potential trends
that might impact financial planning; and
Provide other key first quarter information, including headcount statistics, status of
Capital Improvement Projects, and requests for City Council’s approval of Budget
Adjustment Requests that have not previously been approved.
The City’s actual first quarter financial results will be compared to both the prior year’s
first quarter and the budgeted Target. The Target for e xpenditures is calculated as one
fourth (25%) of the FY 2025-26 Budget and represents the 3-month period from July 2025
Page 35 of 621
Item 9.d.
City Council
Fiscal Year 2025-26 First Quarter Financial Status Report
January 13, 2026
Page 2
through September 2025, except for the Non-Departmental Annual Payments line that
has a Target of the full budget. This approach increas es the expenditure Target from 25%
to 26% for the first quarter. The Target for revenues does not use the 25% Target but a
Target of 11.5% that more accurately reflects the anticipated revenues to be received in
the first quarter of the fiscal year. Using the Target as a comparator against actual results
provides a simplified method to evaluate performance for the quarter.
The Q1 Report also includes a section regarding Budget Adjustment Requests. This
section summarizes individual budget adjustments approved by the City Council during
the first quarter, as well as administrative adjustments completed by City staff.
ANALYSIS OF ISSUES:
Current Year Q1 Revenue and Expenditures Compared to Prior Year
Table 1: Current Year Q1 Actuals Compared to Prior Q1 Actuals
The Consolidated General Fund shown in Table 1 is the primary operating fund of the
City, which accounts for resources and services traditionally associated with government.
The Consolidated General Fund provides administrative, financial, police protection,
community development, public works, fire, and recreation services to the community.
The Consolidated General Fund accounts for revenues that have unrestricted uses and
are not required legally or by contractual agreement to be accounted for in another fund.
The City has historically reported on the Consolidated General Fund separately from the
Local Sales Tax Fund, although the City’s auditors combine this information in the Annual
Comprehensive Financial Report.
The Measure O-06 Sales Tax Fund accounts for the revenues derived from Measure O -
06, a local 1/2% sales tax approved by the City's voters in November 2006. Measure O -
06 included advisory measures when passed, providing guidance on the uses to which
the funding should be allocated. To ensure accountability, the measure included a
provision requiring the City to publish and distribute an annual report to each household
on the revenues and expenditures from the sales tax proceeds. Measure E -24, passed
during the November 5, 2024, election, will increase the city’s sales tax by 1%. Funds
began being collected on April 1, 2025. To aid in the collection and reporting of this
information, the City has accounted for these two funds in separate accounts.
A more thorough explanation of year-end variances is set forth in the attached financial
report (Attachment 1).
First Quarter
FY 2025-26
First Quarter
FY 2024-25 Variance
Revenue 2,959,691 2,722,775 236,916
Expenditures 8,312,182 7,729,447 582,735
Page 36 of 621
Item 9.d.
City Council
Fiscal Year 2025-26 First Quarter Financial Status Report
January 13, 2026
Page 3
Q1 Revenue and Expenditures Compared to Target
Table 2: Q1 Actuals Compared to Target
Table 2 above compares the FY 2025-26 first quarter actual results to the budgeted
Target. Q1 actual revenue was short of the Target by $693,000. Q1 actual expenditures
were short of the Target by approximately $891,117. A more thorough explanation of
year-end variances is set forth in the attached financial report.
ALTERNATIVES:
The following alternatives are provided for the Council’s consideration:
1. Receive and file the Fiscal Year 2025-26 Q1 Financial Status Report; or
2. Provide other direction to staff.
ADVANTAGES:
The financial report presents an updated review of the City’s financial performance in the
first quarter of FY 2025-26.
DISADVANTAGES:
No disadvantages have been identified at this time.
ENVIRONMENTAL REVIEW:
No environmental review is required for this item.
PUBLIC NOTIFICATION AND COMMENTS:
The Agenda was posted at City Hall and on the City’s website in accordance with
Government Code Section 54954.2.
ATTACHMENTS:
1. Fiscal Year 2025-26 First Quarter Financial Status Report
FY 2025-26 First
Quarter Target
FY 2025-26 First
Quarter Actuals Variance
Revenue 3,652,692 2,959,691 (693,000)
Expenditures 9,203,299 8,312,182 (891,117)
Page 37 of 621
ATTACHMENT 1
Page 1
City of Arroyo Grande
Fiscal Year 2025-26
First Quarter Financial Status Report
INTRODUCTION
The following report is an overview of the City’s fiscal position at the end of the first quarter of Fiscal Year
(FY) 2025-26. The purpose of this report is to update the public and the City Council on the City’s financial
position at the end of the first quarter and compare actual results to the prior year and the Adjusted
Budget to determine the City’s performance. The First Quarter report timeframe is July 1, 2025, through
September 30, 2025.
The financial report is organized in the following sections:
Section 1 – an overview of City’s financial position after the end of the first quarter of FY 2025-26. This
includes a comparison of first quarter results between the current and prior year. In addition, first quarter
results will be compared to the budgeted Target. As part of the analysis, brief explanations of significant
revenue and expenditure variances are included.
Section 2 – a listing of any personnel changes occurring during the first quarter and a summary of
headcount by department. This section also includes the City’s calculated vacancy rate.
Section 3 – an update on the Capital Improvement Projects (CIP) managed by the Public Works and
Community Development Departments. This section includes CIP that were completed in the first quarter
along with their final costs.
Section 4 – a listing of Budget Amendment Requests previously approved by Council and completed in
the first quarter of the fiscal year, as well as a list of additional budget adjustments that are being
presented to Council along with the first quarter report for consideration and approval.
Section 5 – an update on the Goal Status Reports to Council that includes progress towards completing
Major City Goals and Capital Improvement Plan.
Page 38 of 621
ATTACHMENT 1
Page 2
SECTION 1: OVERVIEW OF FINANCIAL POSITION
CITY FUND STRUCTURE
The overall City budget is comprised of many individual funds, which are categorized below. This financial
report will focus primarily on the Consolidated General Fund but will also report on all Governmental
Funds.
Consolidated General Fund – The Consolidated General Fund is the primary operating fund of the City,
which accounts for resources and services traditionally associated with government. The Consolidated
General Fund provides administrative, financial, police protection, community development, public
works, fire, and recreation services to the community and other funds. The Consolidated General Fund
accounts for revenues that have unrestricted uses and are not required legally or by contractual
agreement to be accounted for in another fund. The City has historically reported on the Consolidated
General Fund separately from the Measure O-06 Sales Tax Fund, although the City’s auditors traditionally
combine this information in the Annual Comprehensive Financial Report (ACFR). The Measure O-06 Sales
Tax Fund accounts for the revenues derived from Measure O-06, a local 1/2% sales tax approved by the
City's voters in November 2006. Measure O-06 included advisory measures when passed, providing
guidance on the uses to which the funding should be allocated. To ensure accountability, the measure
included a provision requiring the City to publish and distribute an annual report to each household on
the revenues and expenditures from the sales tax proceeds. Measure E-24, passed during the November
5, 2024 election, will increase the city’s sales tax by 1%. Funds began being collected on April 1, 2025. To
aid in the collection and reporting of this information, the City has accounted for these two funds in
separate accounts. This report will present information for the Consolidated General Fund that includes
Measure O-06 and Measure E-24 Sales Tax Fund revenues and expenditures
Special Revenue Funds – Special revenue funds are used to account and report the proceeds of specific
revenue sources that are restricted or committed to expenditure for specified purposes other than debt
service or capital projects.
Debt Service Funds – This fund is used to account for the accumulation of resources and payment of long-
term debt principal interest. This includes the USDA loan issued by the City to finance the relocation of
City Hall.
Enterprise Funds - An enterprise fund is a separate accounting and financial reporting mechanism for
which revenues and expenditures are segregated into a fund with financial statements separate from all
other governmental activities. These funds include Water and Sewer services provided to City residents.
Private Purpose Fund – The private-purpose fund was created to hold the assets of the former
Redevelopment Agency of the City of Arroyo Grande until they are distributed.
Agency Funds – Agency funds are funds that the City holds on behalf of another entity. Currently, there
are three Agency funds. One is the Sanitation District fund, which accounts for the receipt and remittance
of wastewater processing fees on behalf of the South San Luis Obispo County Sanitation District. The
second is the Downtown Parking Fund, which collects assessments from Arroyo Grande Village merchants
within the boundaries of the Parking and Business Improvement Area for maintenance of the Village
Page 39 of 621
ATTACHMENT 1
Page 3
parking lots. The third is the San Luis Obispo Tourism Marketing District (SLOTMD) Fund, which accounts
for the receipt and remittance of assessments collected from lodging operators on behalf of the SLOTMD.
The following chart below shows an overview of the City’s fund structure.
CURRENT YEAR ACTUALS COMPARED TO PRIOR YEAR
Table 1 below reflects revenue and expenditure patterns through the end of the first quarter of FY 2025-
26 and compares the current quarter results against the prior year’s results for all Governmental Funds
as well as the City’s Consolidated General Fund. The totals in the table reflect the first quarter actuals for
both revenue and expenditures, divided by that fiscal year’s annual budget.
Table 1
The following discussion focuses on both the City’s Governmental Funds and the Consolidated General
Fund and provides a comparison between first quarter results for the current and prior year for both
revenue and expenditures. Governmental Funds and Consolidated General Fund revenue and
expenditures for the first quarter of this year are generally on Target with prior year. The Governmental
Funds category includes Special Revenue Funds, Debt Service Funds, as well as the Consolidated General
Fund.
Legislative & Information Services Fire Protection Impact Fees City Hall Debt Service Sewer Successor Agency to RDA Downtown Parking
Administrative Services Public Access Television Sewer Facility Sanitation Distribution
Community Development Police Protection Impact Water San Luis Obispo Tourism
Police Department Park Development Water Facility Marketing District
Recreation Services Park Improvement Lopez Water (SLOTMD)
Public Works Recreation Community Center
Local Sales Tax Fund Grace Lane Assessment District
Parkside Assessment District
Street (Gas Tax)
Traffic Signalization
Traffic Circulation
Transportation Facility Impact
Transportation
In-Lieu Water Neutralization
In-Lieu Affordable Housing
Tourism Business Improvement Dist.
Water Availability
CDBG Grant Fund
American Rescue Plan Act (ARPA)
State COPS Block Grant
Ag
e
n
c
y
F
u
n
d
s
Sp
e
c
i
a
l
R
e
v
e
n
u
e
F
u
n
d
s
FIDUCIARY FUNDSGOVERNMENTAL FUNDS
ALL FUNDS
PROPRIETORY FUNDS
Ge
n
e
r
a
l
F
u
n
d
De
b
t
S
e
r
v
i
c
e
F
u
n
d
s
En
t
e
r
p
r
i
s
e
F
u
n
d
s
Pr
i
v
a
t
e
P
u
r
p
o
s
e
F
u
n
d
First Quarter
FY 2025-26
First Quarter
FY 2024-25 Variance
Revenue 3,492,624$ 5,285,963$ (1,793,339)$
Expenditures 8,968,000$ 8,182,934$ 785,067$
First Quarter
FY 2025-26
First Quarter
FY 2024-25 Variance
Revenue 2,959,692$ 2,722,775$ 236,917$
Expenditures 8,312,181$ 7,729,447$ 582,734$
Governmental Funds
Consolidated General Fund
Page 40 of 621
ATTACHMENT 1
Page 4
Governmental Funds – At the end of the first quarter of FY 2025-26, Governmental Fund revenue was
-33.9% or $1.8 million lower than prior year, and expenditures were lower by 9.6% or $785,067.
The majority of the revenue and expenditure variances in Governmental Funds were attributed to
variances within the Consolidated General Fund and the American Rescue Plan Act (ARPA) Fund,
which is separate from the Consolidated General Fund and not otherwise addressed in this report.
The Governmental Funds category includes the Consolidated General Fund as well as other Special
Revenue Funds. The Consolidated General Fund and ARPA Fund variances are explained as follows:
Consolidated General Fund - Consolidated General Fund revenue at the end of the first quarter was
8.7%, or $236,917 million higher than the first quarter of the prior year. Expenditures increased by -
7.5%, or $582,734 higher than the first quarter of the prior year. The majority of the variance between
the two fiscal years is related to increased costs of one-time payments for Liability and Property
Insurance, CalPERS Unfunded Accrued Liability, Workers Compensation.
ARPA Fund – The ARPA Fund was created to help separately track funding provided pursuant to the
American Rescue Plan Act. This Act is intended to provide financial aid to families, governments,
businesses, schools, non-profits and others impacted by the COVID-19 public health crisis. To date the
City has received the full amount allocated totaling $4,300,241. In FY 2021-22 expenditures totaled
$604,246. In FY 2022-23 expenditures totaled $745,837. In FY 2023-24 expenditures incurred totaled
$1,163,495 the remaining $1,786,663 is currently recognized as revenue in FY 2024-25.
CONSOLIDATED GENERAL FUND IMPACTS
The following discussion focuses on the City’s Consolidated General Fund performance. Chart 1 starts off
with a simple overview of Consolidated General Fund performance compared to the Target. Next are
expenditures by category (Table 2). This is followed by a summarized look at FY 2025-26 first quarter
actual expenditures compared to the Target (Table 3). Lastly, a discussion of Consolidated General Fund
revenue is included, which compares first-quarter actual results to the Target (Table 4).
Chart 1
Chart 1 shows a simple comparison
of actual revenue and
expenditures to the Target. The
actual first quarter Consolidated
General Fund revenue is less than
the budgeted Target by $693,000.
which is not unusual since revenue
realization is typically lower than
the Target through the first quarter
due to the time lag involved in
billing cycles and the receipt of
reimbursements. Likewise, actual
expenditures through the first
quarter totaled $8.3 million, or
23% of the full year’s Budget, and are under the Target by $891,117. A more detailed discussion on
Consolidated General Fund revenue and expenditure variances is included later in this report.
Page 41 of 621
ATTACHMENT 1
Page 5
Table 2
Table 2 reflects major expenditure cost
categories within the Consolidated General
Fund. This chart is intended to explain where
the City’s resources were spent during the
first quarter. Within the total expenditures of
$4.7 million, 57% of the City’s costs are
associated with personnel, 41.8% with
operating and maintenance, 0.1% for the
City’s debt service, 0% for Capital Outlay, and
1.1% with transfers to other funds.
Table 3 reflects the first quarter status of all Consolidated General Fund operating departments. Some
departments include multiple divisions. The divisions are consolidated under their respective department,
rather than reflected individually within the table.
Table 3 – Consolidated General Fund Expenditures by Department
Overall, first quarter expenditures were $891,117 under the Target. The majority of City departments
were under spent, except for Administrative and Recreation Services. Some of the more significant savings
occurred in the Police, Community Development, Public Works, City Administration, and Legislative &
Information Services Departments. A more detailed explanation of key expenditure variances by
individual department/division is provided below.
City Administration 1,940,770$ 485,193$ 306,729$ 178,464$ 9%
Legislative & Information Services 491,675 122,919 91,778 31,141 6%
Measure O-06 Sales Tax Fund 1,521,200 380,300 320,931 59,369 4%
Measure O-06 CIP Allocation 3,045,480 - - - 0%
Measure E-24 Sales Tax Fund 32,500 8,125 - 8,125 25%
Measure E-24 CIP Allocation 5,952,640 - - - 0%
Administration Services 5,030,480 1,257,620 1,514,468 (256,848) -5%
Non-Departmental Annual Payments 3,419,000 3,419,000 3,322,177 96,823 3%
Community Development 2,143,940 535,985 265,537 270,448 13%
Police Department 7,629,296 1,907,324 1,589,941 317,383 4%
Recreation Services 980,550 245,138 254,636 (9,498) -1%
Public Works 3,366,780 841,695 645,985 195,710 6%
TOTAL EXPEDITURES 35,554,311 9,203,299 8,312,182 891,117 3%
%
Fav/(Unfav)
Consolidated General Fund Department Variances - First Quarter
Consolidated General Fund
Department
FY 2025-26
Budget
FY 2025-26
Actuals
Dollar
Fav/(Unfav)
FY 2025-26
Q1 Target
FY 2025-26 % of
Q1 Actuals Actuals
Personnel Costs 4,739,846$ 57.0%
Operating Costs 3,472,105 41.8%
Debt Service 5,483 0.1%
Capital Outlay 1,898 0.0%
Transfers Out 92,850 1.1%
Total 8,312,182$
Expenditure Category
Page 42 of 621
ATTACHMENT 1
Page 6
KEY EXPENDITURE VARIANCES FOR INDIVIDUAL DIVISIONS/DEPARTMENTS FOR
FISCAL YEAR 2025-26
Police Services includes the functions of Administration,
Patrol Services, Support Services and the Office of
Traffic Safety (OTS) Grant for Traffic/DUI Enforcement
Program. For simplicity, Police Services will be analyzed
in total rather than by individual divisions. Some of the
more significant variances include:
The Police Department had five vacancies throughout the first quarter fiscal year, resulting in
labor savings of approximately $310,100.
The Community Development Department includes the
functions of Planning and Building & Safety Divisions.
The majority of the favorable variance in this
department can be attributed to salary savings and
lower spending in contractual services. Some of the
more significant variances include:
Contractual services for the Planning Division had savings of approximately $97,200 related to
the Comprehensive General Plan Update.
The Building Division contractual services has a variance of $118,000 due to the timing of
invoicing being received resulting in a savings to the overall department budget.
The Administrative Services Department includes the
City’s Finance and Information Technology functions,
along with other general City expenses. A “salary
savings” line item was included in this department as a
placeholder, rather than trying to predict which
departments might have vacancies each year. Because
actual vacancies occurred in other departments—not in
Administrative Services—the savings appear in those areas instead. As a result, the first quarter shows
this department slightly over its budget target, even though this is simply due to where the placeholder
was originally budgeted.
Department: Police Services
Division: Various (4201, 4203, 4204, 4207)
Issue: Overall savings in salaries and benefits
Impact to Consolidated General Fund:
$317,383 savings
Department: Community Development
Division: Various (4130, 4160)
Issue: Overall savings in contractual services
Impact to Consolidated General Fund:
$270,448 savings
Department: Administrative Services
Division: Various (4120, 4140, 4145)
Issue: Overall overage due to Salary Savings
budget
Impact to Consolidated General Fund:
$256,848 overage
Page 43 of 621
ATTACHMENT 1
Page 7
KEY REVENUE VARIANCES BY ACCOUNT FOR THE FIRST QUARTER
Table 4 – Consolidated General Fund Revenue
As reflected in Table 4, first quarter revenue is below the Target by $693,000. This table uses a Target of
11.5% that more accurately reflects the anticipated revenues to be received in the first quarter of the
fiscal year. Revenue realization is typically low at the end of the first quarter of the fiscal year due to the
time lag involved in billing cycles and the receipt of reimbursements. A more detailed discussion is
included below to help explain actual revenue variances through the first quarter compared to the Target.
Property Tax – The majority of the City’s property tax revenue comes from Secured Property Taxes. This
tax is billed on a fiscal year (July 1- June 30) basis and is payable in two (2) annual installments. Property
owners typically receive their first property tax bill at the end of September or early October, with a due
date of November 1st. The majority of property tax related to the first installment will be received in
December 2025. The second property tax bill installment is received in April 2026 and will be included in
the fourth quarter report. Property tax typically represents around 30% of the City’s annual revenue. The
Target is based on one month of Property Tax revenue. Actual revenue for a full month was not received
in this category and is much lower than the Target, making up the majority of the revenue variance this
quarter.
Sales Tax, Measure O-06 Fund, and Measure E-24 Fund – Sales tax, Measure O-06, and Measure E-24
Sales Tax realization through first quarter is on track. Actual sales tax revenue received through the first
quarter was $1,028,076. The Target is based on one month of revenue, taking into account the timing of
anticipated payments.
Transient Occupancy Tax (TOT) – TOT revenue is reflecting a $78,248 favorable variance to the Target.
The Target and actual TOT revenue represents only two months of TOT receipts due to the timing of
payments. Lodging facilities have thirty days after the month’s end to make their TOT payments.
Property Tax 7,164,400$ 597,033$ 29,859$ (567,175)$ -8%
Sales Tax 5,206,800 433,900 404,102 (29,798) -1%
Measure O-06 Sales & Use Tax 2,942,500 245,208 222,875 (22,334) -1%
Measure E-24 Sales & Use Tax 5,870,000 489,167 401,099 (88,067) -2%
Transient Occ. Tax 1,493,500 248,917 327,165 78,248 5%
Property Tax in Lieu of VLF 2,322,600 - - - 0%
Franchise Fees 921,100 153,517 113,340 (40,176) -4%
License & Permit Fees 576,000 144,000 107,360 (36,640) -6%
User Fees 696,000 174,000 181,051 7,051 1%
Planning Fees 419,600 104,900 130,545 25,645 6%
Recreation Fees 364,800 91,200 92,838 1,638 0%
Transfers In 2,951,500 737,875 712,875 (25,000) -1%
Other Revenue 931,900 232,975 236,582 3,607 0%
TOTAL 31,860,700$ 3,652,692$ 2,959,691$ (693,000)$ -2%
%
Fav/(Unfav)
Consolidated General Fund Revenue Variances - First Quarter
REVENUE BY CATEGORY FY 2025-26
Budget
FY 2025-26
Q1 Actuals
Dollar
(Unfav)/Fav
FY 2025-26
Q1 Target
Page 44 of 621
ATTACHMENT 1
Page 8
Property Tax in Lieu of Vehicle License Fees (VLF) – Property tax in lieu of VLF is received in two
installments during the fiscal year. Typically, the revenue is received in the months of January (3rd quarter)
and June (4th quarter). The Target for this revenue is zero in the first quarter.
Franchise Fees – Only two months of Waste Connection franchise fees were received through first
quarter. In addition, Charter Communications franchise fees earned in the first quarter will not be paid
and received until the second quarter. In light of the timing of payments, the Target is based on 2 months
of revenue. Without the Charter communications franchise fee receipts, the actual revenue at the end of
the first quarter is lower than the Target by $40,176.
License & Permit Fees, User Fees, and Planning Fees – License and permit revenue is below the Target by
$36,640. User fee revenue is above the Target by $7,051. Planning revenue exceeded the Target by
$25,645. The Target is based on 25% or 3 months of the fiscal year’s total budget. Revenue in this category
is customer driven and fluctuates over the course of a year as well as year over year based on demand.
Recreation Fees – Recreation revenue is above the Target by $1,638. The Target is based on 3 months of
the fiscal year’s total budget.
Other Revenues – This revenue category includes business license tax, fines, revenue from other
government agencies, charges for services and any other revenues accounts received in the consolidated
general fund. The Target is based on 3 months of the fiscal year’s total budget.
Page 45 of 621
ATTACHMENT 1
Page 9
SECTION 2: POSITION CHANGES AND HEADCOUNT NUMBERS
POSITION ALLOCATION CHANGES MADE BY THE CITY COUNCIL (FIRST QUARTER)
None made during this quarter.
FULL TIME EQUIVALENT (FTE) BY DEPARTMENT – PERMANENT STAFF ONLY
The following table reflects FTE staffing by department. The table only includes permanent staff and does
not include part-time or temporary staffing. While departments may hire part-time staff on a regular or
seasonal basis, they are not included in the analysis below.
EMPLOYEE VACANCY RATE
The City’s employee vacancy rate at the end of the first quarter of FY 2025-26 was 6.3%. This equates to
five (5) vacant positions. The vacancy rate tracks the number of permanent vacant positions at the end of
the quarter in comparison to the total number of permanent positions available. Unlike a turnover rate,
which tracks employees that separated during the period, the vacancy rate only looks at vacancies at the
end of period. The costs associated with turnover include advertising new positions, training, overtime,
reduced productivity, and workload imbalance.
Department Adopted Budget
Headcount (FTE’s)
Vacancies
(1st Qtr)
% of Total
Staffing Vacant Positions
City Manager & Human Resources 3 - 4%
Administrative Services 7 - 9%
Community Development 7 - 9%
Legislative & Info Services 2 - 3%
Police Department 31 5 38%Police Officer (4), Records
Clerk
Public Works 27 - 33%
Recreation Services 3 - 4%
Total 80 5 100%
Page 46 of 621
ATTACHMENT 1
Page 10
SECTION 3: UPDATE ON COMPLETED CAPITAL PROJECTS
This information is provided to keep the Council apprised of the status of the City’s Capital Improvement
Projects (CIP).
Project Fund Total Budget*
Current
Status
Project Budget
Expended
Public Safety Video Cameras COPS 200,000$ In Progress
Pavement Management Program
SB1/Measure E-2024
Measure O-2006 Sales
Tax/CDBG 4,139,506$ In Progress 99$
Halcyon Road Complete Streets
HSIP/RSHA/USHA/Safe
Routes to
School/General/Measure O-
2006 Sales
Tax/ATP/Transportation
Facilities DIF 11,601,500$ In Progress 1,417,893$
Traffic Way Bridge Replacement
HBP/Sales Tax -
Outreach/Measure O-2006
Sales Tax 14,500,593$ In Progress 7,843,018$
Financial Management Software
Sewer/Water/Measure O-
2006 Sales Tax 413,000$ In Progress 230,238$
Master Plan incl. ADA Access (Community
Center, Elm St. Park, Soto Sports Complex,
Don Roberts Field, Corp Yard) & Community
Survey Measure O-2006 Sales Tax 394,745$ In Progress 133,372$
Bridge Street Bridge Habitat Mitigation HBP $ 48,628 In Progress
Virginia Drive and S. Halcyon Road Curb
Ramp and Sidewalk Improvement CDBG 56,749$ Not Started -$
Le Point Street Parking Lot Expansion Measure O-2006 Sales Tax/In-42,500$ In Progress 4,990$
Corrugated Metal Pipe (CMP) Investigation
and Repair Measure O-2006 Sales Tax 100,000$ In Progress 4,200$
SCADA Software/Electronics Design and
Upgrade Water Fund 330,000$ In Progress -$
New Play Structure - Parkside Park Parkside Assessment District 250,000$ Completed 225,630$
PD EOC Upgrade Other Gov Agencies/Measure 100,000$ In Progress 129,043$
Sidewalk Repairs and Improvements Measure E-2024 Sales Tax 500,000$ In Progress -$
Water Well #11 Facilities Water Availability 42,771$ Not Started -$
Opticom Preemptive Devices Measure O-2006 Sales Tax 48,200 In Progress 37,015$
Traffic Way Bridge Replacement Habitat
Mitigation
HBP/Measure O-2006 Sales
Tax 50,000$ In Progress -$
Watershed Management Plan and
Stormwater Master Plan Measure O-2006 Sales Tax 500,000$ Not Started -$
Soto Basin #2 Reservoir Liner Repair Measure O-2006 Sales Tax 200,000$ In Progress -$
Replace Beach Volleyball Court at Rancho
Grande Park Measure O-2006 Sales Tax 25,000$ In Progress -$
Fire Station 1 HVAC Unit Replacement Measure O-2006 Sales Tax 100,000$ In Progress -$
Fire Station 1 Front Lobby Security Measure O-2006 Sales Tax 22,000$ In Progress -$
City Structure Roof Repairs (City Hall,
Balcony & Southern & Western Siding, Old
City Hall, Council Chambers, PD, Women's
Club, Fire Station 1)
Measure O-2006 Sales
Tax/Park Improvement
370,000$ In Progress -$
Old City Hall Building Repairs Measure O-2006 Sales Tax 100,000$ Not Started 9,708$
ADA Improvements Measure O-2006 Sales Tax 75,000$ In Progress -$
Safety Improvements Measure O-2006 Sales Tax 25,000$ In Progress -$
City Council Chambers Remodel Measure O-2006 Sales Tax 50,000$ In Progress -$
E. Grand (Halcyon to Elm) Economic
Development Master Plan Measure O-2006 Sales Tax 250,000$ In Progress -$
Replacement of Traffic Guardrails Measure O-2006 Sales Tax 200,000$ In Progress -$
Huasna Road, Corbett Canyon, and E.
Branch Street Intersection Roundabout Transportation Facilities DIF 400,000$ In Progress -$
Digital Community Bulletin Board Project Measure O-2006 Sales Tax 25,000$ Not Started -$
Software for Public Safety Camera System
to allow Traffic Counts Transportation Facilities DIF 50,000$ In Progress -$
Reservoir No. 5 Redundancy Interconnect
(Los Ciervos to Andre Dr.)Water Fund 100,000$ In Progress -$
Water Main and Service Replacement
related to PMP Projects Water Fund/Water Facility 700,000$ In Progress -$
City Hall Second Story Water Leak Repair Measure O-2006 Sales Tax 20,000$ In Progress -$
Page 47 of 621
ATTACHMENT 1
Page 11
SECTION 4: APPROPRIATION TRANSFERS AND BUDGET ADJUSTMENTS
Administrative and Previously Approved First Quarter Budget Adjustments
The following first quarter budget adjustments were previously approved by the City Council or are
classified as administrative and not requiring City Council approval.
Capital Improvement: Administrative Carryover of $11,306,889 for the Capital Projects listed in the table
below. Capital Project funds do not have annual appropriated budgets. Control over capital projects is
maintained by a project-length capital improvement budget. This project-length budget authorizes total
expenditures over the duration of a construction project, rather than year by year.
Police Department: Receive $80,000 of Office of Traffic Safety Grant funds and appropriated the funding
to implement driving under the influence enforcement services. Approved on August 12, 2025, City
Council meeting, Item 9.h.
Recreation Services Department: Appropriate $60,000 from the Arroyo Grande Tourism Business
Improvement District (AGTBID) Fund Balance to reflect the changes in the authorized uses of assessments
implemented by Resolution No. 2025-057. Approved on September 9, 2025, City Council meeting, Item
9.f.
Fund Project #Project Title
Project Budget
Adjustment
350 5422 LE POINT PARKING LOT 39,205$
350 5453 FINANCIAL MGMT SOFTWARE 215,662
350 5463 WOMAN'S CLUB LIGHTING PROJECT 1,821
350 5468 PUBLIC SAFETY VIDEO CAMERA 244,300
350 5481 CITY HALL SECOND STORY WATER LEAK 20,000
350 5556 SOTO/ELM MASTER PLAN 69,815
350 5567 NEW PLAY STRUCTURE - PARKSIDE 250,000
350 5568 ADA BATHROOMS ELM ST. PA 235,000
350 5602 WAYFINDING 24,162
350 5606 HALCYON RD COMPLETE STRE 5,387,198
350 5616 HALCYON AT VIRGINIA DR C 113,498
350 5638 PAVEMENT MANAGEMENT PROG 571,736
350 5658 STRIPING, CROSSWLKS & SI 283,535
350 5679 TRAFFIC WAY BRIDGE IMPRO 3,362,385
350 5794 CORRUGATED METAL PIPE LI 95,800
612 5814 Wastewater Master Plan Update 10,000
640 5904 Water Master Plan Update 10,000
640 5944 Water Well #11 Facilities 42,771
640 5953 Scada Radio Upgrades 330,000
11,306,889$
Page 48 of 621
ATTACHMENT 1
Page 12
SECTION 5: UPDATE ON MAJOR CITY GOALS AND CAPITAL IMPROVEMENT PLAN
This information is provided to keep the Council apprised of the status of the Goal Status Reports to
Council that includes progress towards completing Major City Goals and the Capital Improvement Plan.
These reports present updates and communications about the status of City projects, goals, and
performance measures. The five major goals are:
The following tables provide a breakdown of the Council Goal’s Work Plan by goal. Here is a key for
purposes of defining each department.
CMO City Manager's Office
AS Administrative Services
LIS Legislative and Information Services
PD Police Department
PW Public Works
Rec Recreation Services
Fire Five Cities Fire Authority
CD Community Development
Key
Page 49 of 621
ATTACHMENT 1
Page 13
Goal Strategy Task/Action Carryover Action
or New
Responsible
Department
Anticipated to
Start
Completion
Target Update
1.1 Revenue Generation 1.1a 400 W. Branch Disposition and Development Agreement Carryover CMO/CA/CD In Progress 1Q FY 2026-27 In Progress
Pursue New Revenue
Sources
1.1b Develop a Special Event that drives visitation during shoulder and
winter months and build destination awareness Carryover Rec In Progress 4Q FY 2025-26 In Progress
1.1c Develop an Economic Development Program New CMO 1Q FY 2025-26 4Q FY 2025-26 In Progress
1.2 Consider Cannabis as a Means
of Economic Development 1.2a Evaluate cannabis operations that bring in revenue New CD/CMO 1Q FY 2025-26 2Q FY 2025-26 In Progress
1.2b Conduct study session with the City Council regarding potential
cannabis ordinance Carryover CD/CA/CMO/LIS 3Q FY 2025-26 3Q FY 2025-26 In Progress
1.2c Conduct study session with the City Council regarding potential
cannabis development agreement Carryover CD/CA/CMO/LIS 4Q FY 2025-26 4Q FY 2025-26 Not Started
1.2d Prepare and adopt cannabis ordinance, if directed by the City
Council Carryover CD/CA/CMO 4Q FY 2025-26 1Q FY 2026-27 Not Started
1.2e Evaluate feasibility of a Cannabis Tax, if directed Carryover CD/AS/CA/CMO 4Q FY 2025-26 1Q FY 2026-27 In Progress
1.3 Transient Occupany Tax
Changes
1.3a Work on changes to TBID ordinance for expanded use of TOT
funds New CMO/Rec/LIS 1Q FY 2025-26 1Q FY 2025-26 Completed
1.3b Bring changes to TBID assessment and ordinance to Council for
approval New CMO/Rec/LIS 1Q FY 2025-26 1Q FY 2025-26 Completed
1.3c Evaluate opportunities related to City TBID and potential TOT
Measure New CMO/Rec/LIS In Progress 4Q FY 2024-25 In Progress
1.3d Hold study session with City Council and visitor serving
accomodations to eliminate TBID New CMO/Rec/LIS 1Q FY 2025-26 1Q FY 2025-26 Not Started
1.3e If directed by Council, issue RFP for consultant to develop a survey
and outreach strategy to community for TOT New CMO/LIS 1Q FY 2025-26 2Q FY 2025-26 Not Started
1.3f Award contract for consultant to survey and develop outreach
strategy for TOT New CMO/LIS 2Q FY 2025-26 2Q FY 2025-26 Not Started
1.3g Conduct public education regarding need for TOT New CMO/LIS 2Q FY 2025-26 2Q FY 2026-27 Not Started
1.3h Bring TOT measure to City Council for consideration of placing on
the November 2026 ballot New CMO/Rec/LIS 4Q FY 2025-26 4Q FY 2025-26 Not Started
2.1 Pursue 2026 State Water Ballot
Measure
2.1a Meet with Department of Public Works at the County of San Luis
Obispo to begin discussion surrounding purchasing some allocated
State Water
New CMO/PW 4Q FY 2024-25 1Q FY 2025-26 In Progress
Achieve Water
Resilience
2.1b If directed by Council, Issue an RFP for a Consultant to evaluate
feasibility of State Water Ballot Measure New CMO/PW/LIS 1Q FY 2025-26 1Q FY 2025-26 Not Started
2.1c Award bid to consultant and begin public outreach and community
messaging regarding a potential State Water Ballot Measure New CMO/PW/LIS 2Q FY 2025-26 2Q FY 2026-27 Not Started
2.1d Seek Council approval on placing a November Ballot Measure New CMO/PW/LIS 4Q FY 2025-26 4Q FY 2025-26 Not Started
2.2 Seek new Water Sources 2.2a Identify opportunities and constraints associated with new Water
Sources New CMO/PW In Progress Ongoing Ongoing
2.2b Support ongoing development and financing of regional water
solution New CMO/PW In Progress Ongoing Ongoing
2.2c Conduct a water and wastewater rate study to adjust rates based
on changes to water supply and changing or new regional partnerships New AS/PW 1Q FY 2025-26 4Q FY 2026-27 In Progress
2.3 Work with Regional Partners 2.3a Preserve Lopez water supply by working with the County on Lopez
litigation New CMO/PW/CA In progress Ongoing Ongoing
2.3b NCMA Management Agreement Amendments Carryover PW In progress Ongoing Ongoing
Page 50 of 621
ATTACHMENT 1
Page 14
Goal Strategy Task/Action Carryover Action
or New
Responsible
Department
Anticipated to
Start
Completion
Target Update
Prioritize Key
Infrastructure Projects
3.1 Prioritize Key Infrastructure
Projects 3.1a 2025 Pavement Management Program Construction New PW 3Q FY 2025-26 4Q FY 2025-26 In Progress
3.1b Traffic Way Bridge Replacement Project Carryover PW In progress 2Q FY 2025-26 In Progress
3.1c Halcyon Complete Streets Design and Construction Carryover PW In progress 4Q FY 2026-27 In Progress
3.1d Concrete Repair Program Carryover PW 2Q FY 2025-26 Ongoing In Progress
3.1e CMP Lining Carryover CD/PW In Progress Ongoing Ongoing
3.2 Pursue Alternative Funding
Sources for Infrastructure Funding
3.2a Pursue Grant applications and administration for infrastructure
projects
Carryover PW/CD/AS In progress Ongoing Ongoing
4.1 Economic Development Tasks 4.1a Retail Market Analysis Carryover CD 4Q FY 2024-25 1Q FY 2025-26 Completed
4.1b Market Demand Studies Carryover CD 4Q FY 2024-25 1Q FY 2025-26 Completed
4.2 General Plan Elements 4.2a Land and Safety Analysis Carryover CD 3Q FY 2023-24 2Q FY 2025-26 In Progress
4.2b Administrative Draft Carryover CD In Progress
4.3 EIR 4.3a Complete draft EIR Carryover CD 1Q FY 2025-26 3Q FY 2025-26 Not Started
4.3b Complete final EIR Carryover CD 3Q FY 2024-25 4Q FY 2025-26 Not Started
4.4 Code Update 4.4a Kick off code update Carryover CD/LIS Not Started
4.4b Bring code changes to Planning Commission for approval Carryover CD 3Q FY 2025-26 3Q FY 2025-26 Not Started
4.4c Bring draft Ordinance of code revision update to Council Carryover CD 4Q FY 2025-26 4Q FY 2025-26 Not Started
4.5 Climate Action Plan 4.5a Kick off CAP and research Carryover CD 1Q FY 2025-26 4Q FY 2025-26 In Progress
4.5b Admin Draft Carryover CD 4Q FY 2025-26 2Q FY 2026-27 Not Started
4.5c Final CAP Carryover CD 2Q FY 2026-27 3Q FY 2026-27 Not Started
5.1 Scope of Work and RFP 5.1a Define scope, research other communities New CD 4Q FY 2024-25 1Q FY 2025-26 In Progress
5.2 Kick Off and Public Outreach 5.2a Kick Off New CD 1Q FY 2025-26 1Q FY 2025-26 Not Started
5.2b Public Outreach New CD Ongoing Ongoing Not Started
5.3 CEQA 5.3a Environmental Review New CD 2Q FY 2025-26 3Q FY 2025-26 Not Started
5.4 Plan Draft 5.4a Administrative Draft Plan New CD 3Q FY 2025-26 4Q FY 2025-26 Not Started
5.5 Final Draft and Hearings 5.5a Final Draft New CD 4Q FY 2025-26 1Q FY 2026-27 Not Started
5.5b Planning Commission Hearings New CD 1Q FY 2026-27 2Q FY 2026-27 Not Started
5.5c City Council Hearings New CD 2Q FY 2026-27 2Q FY 2026-27 Not Started
Complete General Plan
Update
Redevelop the East
Grand Avenue Corridor
(Halcyon Road to Elm
Street)
Page 51 of 621