As is customary for municipalities, the City of Newman has undertaken its mid-year budget review for the fiscal year 2024-2025 and passed a resolution for budget changes on a 5-0 vote at the Feb. 11 City Council meeting.

Dec. 31 marks the halfway point of the city's fiscal year, and officials took this opportunity to assess their revenue and expense projections for the first six months.

In their analysis, the city compared budgeted revenues and expenditures with the actual amounts received and spent through December 31, 2024. It was noted that revenues and expenditures do not arrive in equal amounts each month. As of Dec. 31, total General Fund Revenues collected stood at 26.8% of the budget, while revenues for all funds were at 21.4%. More revenues are typically collected in the second half of the year. General Fund expenditures were at 46.8% of the budget, and expenditures for all funds were at 25.9%, according to the city staff report.

The proposed budget adjustments were carefully analyzed and discussed with the City Manager, various department heads, and their staff. The original budget, approved last June, had only estimated beginning fund balances, but now the city uses actual audited beginning fund balances to project ending fund balances.

One notable change in General Fund revenue projections is a payment from the Community Facility District (CFD) to reimburse the General Fund for the costs of setting up the CFD. The expenditure budget adjustments include $110,500 in General Fund expenditures and $147,523 in other fund expenditures. Key changes include the promotion of one employee to Senior Account Clerk and the addition of two Maintenance Workers due to the new NEWS project area and the replacement of previous employees.

Initially, the city projected General Fund expenditures to exceed revenues by $653,131. However, the mid-year review now projects an increase in the General Fund balance of $262,080, inclusive of the recommended budget changes. The mid-year budget review projects a General Fund ending balance of $3,934,605, reflecting a 56.3% General Fund reserve. All funds are expected to have positive ending balances, except for Fund 17 - State Grants, Fund 20 - County CDBG, Fund 68 - Business License Surcharge, and Fund 69 - LLD. These exceptions are due to the timing of project expenditures and grant receipts, and adjustments will be made to keep expenditures below revenue receipts in the next fiscal year.