City adopts balanced budget, pours $22.5M into street repairs

At a special meeting held on June 24, the Madera City Council adopted the City's Fiscal Year 2026/27 Annual Operating Budget, marking the City's eighth consecutive balanced budget. City officials said the spending plan remains balanced despite rising costs from inflation, labor shortages and global economic pressures, without dipping into General Fund reserves.

According to City Manager Arnoldo Rodriguez, the adopted budget does not rely on any General Fund carryover to cover costs, including one-time expenses, during the coming fiscal year.

"The City's financial condition has shown modest growth during FY 2025/26," Rodriguez wrote in his budget message. Sales tax, property tax, property tax in lieu of VLF (Vehicle License Fee) and interest revenue all exceeded last year's budgeted projections, giving the City a stronger starting point heading into FY 2026/27.

Revenue Outlook

City officials project General Fund revenues to grow by roughly 2% over the previous fiscal year, an increase described as essentially flat when weighed against rising expenses. Key revenue projections include:

• $12.4 million from the Bradley-Burns uniform local sales tax.
• $7.2 million from Measure K, dedicated strictly to public safety.
• $15.6 million from property taxes and property tax in lieu of VLF, a significant year-over-year increase driven by rising residential and commercial property values.

Cannabis tax revenue is not included in the General Fund's revenue projections.

On the expense side, the City is contending with rising property and liability insurance premiums, energy costs that continue to outpace inflation and a 4.8% increase in employee health insurance costs.

Budget Scope

The citywide budget covers the General Fund, 10 Enterprise Funds, 142 Special Revenue Funds, seven Internal Service Funds, one Capital Projects Fund, two Debt Service Funds and three Fiduciary Funds. Together, they include funding for approximately 283 full-time equivalent positions across public safety, infrastructure, development and internal governance services.

While the City continues to make significant progress on infrastructure improvements, including the nearly completed wastewater treatment plant project valued at more than $10 million and the $5 million water main replacement project on Yosemite Avenue ahead of the State Route 145 rehabilitation, officials acknowledge that the Sewer, Water and Drainage funds face future challenges from inflation and rising energy costs.

Despite those challenges, the City said it will continue pursuing grant funding to help offset the cost of major infrastructure projects, as demonstrated by the recent $2 million in grant funding secured with the assistance of Congressman Adam Gray.

Street Repair a Top Priority

Following the May 2025 adoption of the City's updated Pavement Management Plan, street infrastructure remains one of the budget's largest investment priorities, with approximately $22.5 million allocated for road improvements, representing nearly 10% of the total City budget.

That allocation includes:

• $3 million to expand the 10X10 program, up sharply from $526,000 in the FY 2025/26 budget.
• $13.3 million for road sealing and pavement rehabilitation projects citywide through the Capital Improvement Program.
• $3.5 million for construction of the Lake Street/Fourth Street/Central Avenue intersection.
• $2.5 million for the City's share of the Yosemite Avenue project, which is primarily funded and constructed by Caltrans.

The budget also continues funding the City's dedicated Sidewalk Repair Team at $469,000 to repair buckled sidewalks throughout Madera, alongside the Safe & Clean team responsible for removing illegal dumping and maintaining the Fresno River.

Facilities and Infrastructure

Nearly $1.3 million is allocated to maintain and replace equipment at the Wastewater Treatment Plant, addressing critical needs while extending the facility's useful life.

Other facility investments include $359,000 from the Deferred Maintenance Fund, $315,000 in Measure K funding for Police Department improvements and $175,000 for the water well maintenance program, which is designed to rehabilitate two wells each year.

Additional targeted investments include:

• Police Department: $45,000 for roof restoration, $30,000 for HVAC replacement, $200,000 for a lobby remodel and $100,000 for annex improvements.
• City Hall: $65,000 for building improvements.
• Corporation Yard: $200,000 toward a roof replacement planned for FY 2028/29 as part of an estimated $1 million project.
• Airport Terminal Building: $239,000 for a roof replacement.
• Citywide: $10,000 for door and lock replacements and $20,000 to replace flashing crosswalks at Stadium/Madison and Parkwood.

Parks and Recreation

The budget includes $45,000 in park improvements, covering goal post replacements at the Sunrise Rotary Sports Complex and new goal posts at Rancho Santa Fe, Lions Town & Country and the John W. Wells Youth Center.

Additional projects include restriping the basketball court at the Pan American Center, converting landscaping at Westberry and DoubleTree to low-maintenance stone designs, and replacing flooring at the Pan American Center.

The John W. Wells Youth Center will also receive $30,000 for roof restoration, $10,000 to replace roof solar inverters, $60,000 to seal the exterior gym wall and $45,000 to replace the craft room air conditioning system.

Looking Ahead

Rodriguez said the budget reflects the City's effort to balance service continuity with fiscal responsibility amid challenges that remain largely outside local control, including inflation and international conflicts affecting commodity prices.

"While much remains beyond our control, such as international conflicts, inflation and national trends, the City remains financially stable," Rodriguez wrote. "Staff will revisit budget assumptions throughout the year and report back to the City Council as needed."