SOUTH EL MONTE — South El Monte Budget is showing stronger-than-expected results as the city prepares to close the current fiscal year with a significantly larger operating surplus than originally projected. City officials say steady revenue growth has strengthened the city’s financial outlook while providing flexibility as expenses are expected to increase during the next budget cycle.
During a June 2 budget study session, city staff presented a preliminary Fiscal Year 2026-27 budget showing the General Fund is expected to finish the current fiscal year with an operating surplus of approximately $800,000. That is a substantial improvement from the roughly $100,000 surplus projected when the current budget was adopted last year.
General Fund revenues are projected to increase from approximately $26.8 million this fiscal year to $27.8 million under the proposed 2026-27 spending plan. The additional $1 million in anticipated revenue reflects continued growth across several city revenue sources.
South El Monte Budget Forecast Highlights
Finance Director Masami Higa told the City Council that budget preparation began Jan. 6 at the request of the city manager. City departments reviewed anticipated revenues, operating expenses and capital improvement requests before meeting with city management to evaluate every budget line item.
The proposed budget estimates $27.8 million in General Fund revenue and approximately $28.5 million in expenditures for Fiscal Year 2026-27. The difference creates a projected operating deficit of about $700,000. Staff emphasized that the proposal remains a planning document and will continue to be refined before returning to the City Council for adoption.
The budget presentation also included a five-year financial forecast, expected revenue trends, rising operating costs, cost-reduction strategies and contingency plans intended to maintain long-term fiscal stability.
Several capital improvement projects remain part of the city’s long-range plan but have been deferred until Fiscal Year 2027-28 to better manage available resources. Those projects include Community Center office renovations, an Americans with Disabilities Act accessibility improvement project, pavement maintenance and electrical infrastructure upgrades at City Hall.
South El Monte Budget Supported By Audit
The budget discussion followed a presentation from the city’s independent auditors, who reported that South El Monte received an unmodified, commonly called a clean, opinion on its Fiscal Year 2025 financial statements. Auditors also found no material weaknesses or significant deficiencies in the city’s internal financial controls.
The June 2 study session did not include final adoption of the budget. Instead, council members reviewed the preliminary proposal and provided direction to staff. A finalized budget will return for formal consideration at a future City Council meeting.
Residents can review budget documents and City Council agendas through the City’s CivicClerk portal at https://southelmonteca.portal.civicclerk.com/event/550/files and learn more about the Finance Department at https://www.cityofsouthelmonte.org/167/Finance.
