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Page 20 of 22 <br />City of Redwood City 1017 Middlefield Road, Redwood City, CA. 94063 Tel: 650-780-7000 www.redwoodcity.org <br />5. Preliminary 2025 Ten-Year General Fund Budget Forecast <br />As part of the City’s commitment to financial sustainability, staff develop a ten-year General Fund budget <br />forecast each year to assess the City’s long-term financial outlook as the City Council considers the <br />Recommended Budget. As noted in Section 1 of this memo, the City is in the process of finalizing the FY <br />2023-24 Annual Comprehensive Financial Report (ACFR), which will present a full accounting of the City’s <br />year-end FY 2023-24 financial results. Preliminarily, we anticipate ending FY 2023-24 $18 million better <br />than projected in June 2024. However, we believe that when the ACFR is finalized there may be balances <br />that exceed $18 million because of the way the City has been rolling over unspent one-time funds from <br />year to year. Staff will spend the next several months analyzing these trends and incorporating changes <br />into the ten-year forecast presented with the FY 2025-26 Recommended Budget. <br />6. Proposed Framework and Timeline for Developing the FY 2025-26 Recommended Budget <br />The consideration and adoption of the City budget has always been one of the most important actions <br />that the City Council takes. Through the budget the City Council decides what services the City will provide, <br />and service levels. The budget enables the City to provide community services by establishing <br />organizational staffing and funding necessary supplies and services. The City’s Strategic Plan, financial <br />policies, and commitment to best practices continue to guide development of the FY 2025-26 <br />Recommended Budget. Additionally, the City’s Capital Improvement Program (CIP) will inform FY 2025- <br />26 budget recommendations. As described when presenting the Five-Year CIP in April 2024, the City has <br />an approximately $360 million gap between resources needed and resources available to fund essential <br />community infrastructure. In community surveys and outreach, residents seek improved streets and <br />sidewalks, more bike facilities, parks and open space – all of which require increased funding. Additionally, <br />rate-payers express concerns about rising rates for utilities, and there is no identified funding for <br />stormwater management or improvements to address sea level rise. In addition to seeking grants and <br />leveraging private investment, new strategies are needed to maintain and improve infrastructure. <br />At the February 24, 2025 City Council meeting, staff will seek City Council direction on the proposed <br />framework for developing the FY 2025-26 Recommended Budget: <br />1. Provide services that reflect community priorities and advance the City’s Strategic Plan, taking into <br />account community feedback provided in the bi-annual community satisfaction survey and City <br />Council input provided on February 8, 2025. <br />2. Adhere to financial best practices and City policies, such as: <br />a. Using ongoing revenue to fund ongoing expenses; <br />b. Using one-time revenues for one-time expenses and to pay down long-term liabilities; <br />c. Ensuring adequate reserves. <br />3. Use FY 2023-24 operating balance to stabilize City services in FY 2024-25, support urgent capital <br />needs and reduce City liabilities. <br />8.A. - Page 20 of 70 <br />185