Approval includes Capital Improvement Plan, Responding to Fiscal Challenges and Infrastructure Needs
The Folsom City Council has unanimously adopted a $246 million operating budget and capital improvement plan for the 2023-24 fiscal year that takes effect July 1, 2023.
The adopted budget represents the culmination of the annual evaluation process encompassing the city’s fiscal health, community priorities, infrastructure needs, and daily operations. The spending plan, approved at the May 23 City Council meeting, maintains core service levels and amenities while investing in fundamental community priorities.
“Although the City of Folsom’s General Fund is currently in a fiscally sound position thanks to the prudent and conservative planning by the City Council, we are facing a situation where expenses are growing at a faster rate than revenues. As a result, we anticipate deficits as we work towards balancing the budget in future years,” said City Manager Elaine Andersen. “Moreover, the city is confronted with mounting infrastructure and building maintenance needs that cannot be ignored and are lacking a dedicated funding source. Our primary focus in this constrained environment is to uphold the essential services the city provides.”
While the City of Folsom currently maintains a stable financial status, an Aa2 credit rating, and reserves in the rainy-day fund, upcoming fiscal challenges are anticipated. The City of Folsom’s General Fund began FY 2022-23 with a balanced budget of $102,422,714 and is projected to end the fiscal year with expenses exceeding revenues by $594,769 due in part to inflation. The five-year forecast predicts this structural deficit will grow as the cost of providing services outpaces revenue growth. A multimillion-dollar annual shortfall is projected by 2026.
Additionally, aging infrastructure necessitates attention. There is an estimated $20 million annual shortfall in funding for infrastructure improvements, park and facility repairs, equipment maintenance and replacements, trail maintenance and repairs, as well as staffing needs.
The FY 2023-24 budget includes an operating budget for day-to-day city programs and services and a capital improvement program, a long-range plan that funds public construction projects and infrastructure. The majority of the CIP projects come from sources other than the General Fund.
Highlights include:
• Prospector Park construction
• Intelligent Transportation System Master Plan
• Folsom Lake Crossing Safety Improvements/Median Barrier Project
• East Bidwell and Iron Point Road/Highway 50 onramp improvements
• Storm Water Basins Rehabilitation Project
• Riley Street Sidewalk Project
• Two firefighter positions
• One police officer position
• Two community service officer positions (added midyear of FY 2022-23)
• Alerting system for Fire Station 35
• New software systems to improve efficiencies
• Water tower tank Rehabilitation Project
• Water system flow control facilities rehabilitation and replacement
• Orangevale Avenue and Mountain Oak Pump Station Rehabilitation Project
• Street resurfacing, sewer, and drainage improvements
“For decades, our city has kept a watchful eye on our spending and has prudently saved funds for a rainy day, all while providing the highest level of service to our community. While our current budget is sound, we know that a storm is on the horizon,” said Mayor Rosario Rodriguez. “With one eye on city services and another on the city’s bottom line, the City Council will be having difficult conversations with our community about closing the structural budget deficit. As always, the Folsom community has our utmost commitment to transparency and public involvement.”
The City of Folsom FY 2023-24 budget and presentation are available on the City of Folsom website. For more information, contact Chief Financial Officer Stacey Tamagni at stamagni@folsom.ca.us.
