AGENDA TITLE:
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Adopt a Resolution Approving Fiscal Year 2026/27 Financial Plan and Budget; Approving the Fiscal Year 2026/27 Appropriation Spending Limit; Approving new Job Classifications, and Reclass Studies for Requested Positions, Approving the Budget and Fiscal Policies, Approving the Investment Policy and Approving the Annual Gann Spending Limit (IS - BUD)
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MEETING DATE:
June 17, 2026
PREPARED BY:
Jennelle Baker-Bechthold, Budget Manager
recommendation
RECOMMENDED ACTION:
Adopt a Resolution approving Fiscal Year 2026/27 Financial Plan and Budget; approving the Fiscal Year 2026/27 appropriation spending limit; approving new Job Classifications, and Reclass Studies for requested positions, approving the Budget and Fiscal Policies, approving the Investment Policy, and approving the annual Gann Spending Limit.
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BACKGROUND INFORMATION:
Staff presented information regarding the Fiscal Year (“FY”) 2026/27 budget at Council meetings on May 6t, May 20, and June 3. The draft budget document was made available to Council and released online on May 20, 2026. The full proposed budget is available on the City’s webpage at: https://city-lodi-ca-cleardoc.cleargov.com/20014.
The General Fund for FY 2026/27 is proposed with revenues and expenditures of $96,208,300. The remaining fund expenditures are shown in Table 1, bringing the City’s total FY 2026/27 budget to $302,351,060.
Staffing Changes - The budget proposes 481 full time employees, a net increase of three from FY 2025/26 authorized positions. The recommended changes are shown in Table 2:
• Add (1) Senior Storekeeper - The Water/Wastewater Division currently utilizes one Senior Storekeeper to manage and maintain inventory for both utility operations. As the City has grown and infrastructure demands have increased, the volume and complexity of inventory management responsibilities now exceed the capacity of a single position. To maintain service levels, support operational efficiency, and meet the needs of field staff, the Division is requesting the addition of one Senior Storekeeper.
• Add (1) Transportation Coordinator - The Transportation Division continues to experience increasing federal and state reporting, compliance, grant administration, and program management requirements. These expanding responsibilities have created a need for dedicated staff resources focused on both operational coordination and analytical support.
The Transportation Coordinator is responsible for coordinating and assisting with the day-to-day operations and activities of the City's transit system. Duties include supporting oversight of third-party transit service providers, including the transit operations contractor; performing a variety of administrative, technical, and analytical tasks; serving as a liaison and information resource to customers, community organizations, and the public; supporting management in ensuring compliance with federal and state regulations; evaluating transit services and recommending operational improvements; and performing other related duties as assigned.
• Add (1) Administrative Assistant - The Building Division is experiencing increased workload and longer plan review turnaround times due to growing permit activity, expanding regulatory requirements, and heightened customer service demands. To maintain service levels, improve operational efficiency, and reduce delays in the permit intake and plan review process, the addition of a full-time Administrative Assistant is recommended.
The Administrative Assistant would provide critical administrative and customer service support, allowing Permit Technicians and Plans Examiners to focus on core responsibilities such as permit processing, project intake, and plan review activities. The position would assist with document management, customer inquiries, scheduling, records retention, data entry, and other administrative functions that currently consume staff time needed for technical review and permitting activities.
The budget also includes funding for three reclassifications. Human Resources will need time to conduct the reclassification studies and if a position change is warranted then the reclassification will be effective the first full pay period in July 2026. The proposed budget includes the small increases in salary and benefits that were requested by the departments until such time as Human Resources can conduct their study. If the recommendation is for a new classification and salary range, Human Resources will bring that back to Council for approval of the new classification and salary range. The recommended positions are shown in Table 3:
Budget & Fiscal Policies - The City's Budget and Fiscal Policies provide a framework for responsible financial management and guide the development, adoption, and administration of the annual budget. These policies establish principles related to budgeting, reserves, debt management, capital planning, expenditure controls, and long-term financial sustainability.
The Budget and Fiscal Policies were comprehensively reviewed and updated as part of the FY 2025/26 Mid-Year Budget Review process and were subsequently adopted by the City Council. Since that adoption, staff has reviewed the policies and determined that no additional revisions are necessary at this time. The policies continue to reflect current best practices, organizational priorities, and the City's financial management objectives.
Given the recent comprehensive review and adoption of the policies, staff recommends extending the next formal review until the development of the FY 2028/29 Annual Budget. However, the policies may be brought back to the City Council for review and amendment at any time should operational, regulatory, or fiscal conditions warrant revisions, or at the direction of the City Council.
Investment Policy - California Government Code Section 53646 recommends that local agencies annually review their investment policies and submit them to the legislative body for consideration. Accordingly, the City of Lodi Investment Policy is presented to the City Council for review and approval.
Staff is not recommending any changes to the Investment Policy at this time. The policy remains consistent with the City's investment objectives of safety, liquidity, and yield, while providing internal control procedures designed to safeguard public funds from loss, misappropriation, speculation, and fraud.
As part of a recent account review conducted with Wells Fargo, the City's Investment Policy was evaluated for compliance with California Government Code Section 53601 and was found to be fully compliant. Government Code Section 53601 governs the investment of local agency funds and authorizes a variety of investment instruments intended to preserve principal, maintain adequate liquidity to meet operational needs, and provide a reasonable rate of return while safeguarding public resources. The City's investment portfolio is managed in accordance with the provisions of Government Code Section 53601 and the City's adopted Investment Policy.
Adoption of the Investment Policy will satisfy the annual review recommendation contained in Government Code Section 53646 and reaffirm the City's commitment to prudent and responsible investment management practices.
Appropriations Spending Limit - Article XIII B of the California Constitution, commonly referred to as the Gann Appropriations Limit, was approved by California voters through Proposition 4 in 1979. The Gann Limit establishes an annual appropriations limit on the proceeds of taxes that state and local governments may expend. The limit is adjusted each year based on changes in population and inflation and is intended to control the growth of government spending.
Local agencies are required to calculate and adopt their appropriations limit annually as part of the budget process. The calculation does not restrict the City's ability to receive revenues; rather, it limits the amount of tax proceeds that may be appropriated for spending. Certain expenditures, including debt service, capital outlay projects, and expenditures funded by grants, user fees, and other non-tax revenue sources, are excluded from the calculation.
For Fiscal Year 2026-27, staff has calculated the City's Gann Appropriations Limit at $164,049,380, representing an increase of $7,518,297 from the prior year's limit. The increase is attributable to the annual adjustment factors for population growth and inflation as prescribed by State law.
The City's Fiscal Year 2026-27 appropriations subject to limitation remain well below the calculated appropriations limit. Therefore, adoption of the proposed Gann Appropriations Limit will ensure compliance with Article XIII B of the California Constitution and will not affect the City's ability to provide services or implement the adopted budget.
FISCAL IMPACT:
The Fiscal Year 2026/27 budget provides an expenditure plan for all funds. The All-Funds expenditure budget is projected to be $302,351,060. General Fund revenues and expenses are projected at $96,208,300.
FUNDING AVAILABLE:
Not applicable.