San Bruno’s budget balanced but future finances worrisome

That frees up Measure Q funding — a property tax voted upon by residents to fund the fire station and street and stormwater repairs via $102 million in bonds — for a $40 million repaving plan which would have previously been paid for by Measure G. 

Measure G funds, which come from a half-cent sales tax, will in turn have $17.5 million to contribute to the general fund, McIntyre said.

“We’re able to preserve services — in fact, enhance services,” he said. 

That still leaves unfunded enterprise and capital improvement projects, Chief Financial Officer Nick Pegueros said during his presentation June 10. Enterprise fund revenue sits at $53.2 million for the upcoming fiscal year and expenditures at a whopping $126.6 million. Capital project revenue totals $40.2 million and expenditures at $56.6 million. 

The general fund — which goes to essential resident services and employee salaries, among other functions — will be balanced for the upcoming year at $68.8 million, McIntyre said, due in large part to the choice to restrictively fund capital projects over the long term. 

The city retains the majority of general fund revenue through taxes, however, McIntyre warned $19 million to $20 million in other revenue sources could be at risk — which is reflected in an upcoming structural deficit.

Per the city’s budget document, a structural deficit of $1.15 million is projected by fiscal year 2026, growing to more than $4 million by 2030.

Around $7 million annually in vehicle license fees, typically given back to cities by the state, remain up in the air, and $6 million to $7 million from walmart.com remain pending until a lawsuit around sales tax sharing agreements results in a decision. 

Another $3.7 million in revenue is at risk due to a 2024 bill that allows Native American tribes to sue card rooms for lost revenue, McIntyre said, and finally, the possibility that San Mateo County miscalculated its excess Educational Revenue Augmentation fees throws an additional $2 million in doubt. 

Despite these concerns, San Bruno is moving forward with investments into council-selected priorities for the upcoming year. The most expensive priority could be Clean Up San Bruno, a plan to put $1.5 million into managing and abating garbage dumping, graffiti and keeping medians clean. 

“It’s a big lift because we’ve gotten comfortable allowing people to dump crap in our city,” McIntyre said. “Whether it’s our own residents or outsiders, we don’t know but we’re going to get better at enforcement and figure that out.” 

Other priorities include potential for a residential permit parking program, city communications and engagement and a strategic analysis of major city-owned properties. 

The budget is scheduled for final approval June 24.