TO: HONORABLE CHAIR AND MEMBERS OF THE TRANSACTION AND USE TAX OVERSIGHT COMMITTEE
FROM: Javier Carcamo, Finance Director
PREPARED BY: Evan Crockett, Management Analyst - Special Projects
SUBJECT:
title
Measure T Biannual Report for Fiscal Year 2025/26
end
ABSTRACT
Providing financial update to the Transaction and Use Tax (Measure T) Oversight Committee for July 2025 through December 2025, representing the first half of Fiscal Year (FY) 2025/26. The purpose of this report to the Measure T Oversight Committee is to present information on revenues, expenses, proposed budget adjustments, expense highlights, and operating sustainability reserves associated with the Measure T Fund. In accordance with the resolution that established the Advisory Transaction and Use Tax Citizens Oversight Committee, Measure T revenue and expense information will be used by the Measure T Committee to present to City Council.
RECOMMENDATION
recommendation
Receive and file.
body
PRIOR ACTION/VOTE
On July 17, 2018, the City Council adopted Resolution No. 18-3953, proposing an ordinance enacting a transaction and use tax to be placed on the November 6, 2018, ballot (Measure T) (Vote: 5-0).
On December 18, 2018, the City Council adopted a Resolution declaring the results of the November 6, 2018, General Municipal Election, including therein adoption of Ordinance No. 540-18 enacting a transaction and use tax (vote: 5-0).
On February 5, 2019, the City Council adopted Resolution No. 19-4027 entitled: A Resolution of the City Council of the City of Murrieta, California Establishing an Advisory Transaction and Use Tax Citizens Oversight Committee (Vote: 5-0).
STRATEGIC ALIGNMENT
Maintain a high performing organization that values fiscal sustainability, transparency, accountability and organizational efficiency.
DISCUSSION
In November 2018, Murrieta voters passed ballot Measure “T,” a one-cent Transaction and Use Tax. Measure T is a general tax revenue source for the purpose of maintaining the City of Murrieta's long-term finances, providing funding for general services, including faster response times to emergencies, improved fire protection/paramedic services, increased police sworn personnel to strengthen crime prevention, reduced gang activity/drug crimes, graffiti removal, parks and recreation, and street maintenance/pothole repair.
The Citizens Oversight Committee provides oversight of Measure T sales tax revenues and expenses. This Measure T Oversight Report provides an update through December 2025. This report includes a recap of all Measure T financial activities. This Report shows the importance of Measure T revenues to the City’s current and future financial health and supports City’s Council priorities.
Revenues
The Fiscal Year (FY) 2025/26 adopted revenue budget is $28.7 million. The City’s sales tax consultant provides quarterly reports and revenue forecasts that consider factors such as current economic conditions, actual sales tax volume, collections, and include new economic developments scheduled to open within the current fiscal year. Based on the prior FY 2024/25 final Transaction Sales and Use Tax revenue and collections to date, staff proposed revenue budget amendments during the FY 2025/26 budget update report in March 2026 to amend the adopted revenue budget from $28.7 million to $28.9 million. The table below summarizes Transaction Sales & Use Tax collections through December 2025.
The revenue as of December 2025 is approximately $14.9 million, representing approximately 52% of the amended budget and six months’ worth of collections. When comparing the halfway point District Sales Tax receipts to the same period last fiscal year, the current year's revenue is $524,950 higher, or approximately 3.6%. Based on projections of sales tax receipts for the remainder of the fiscal year, total Transaction and Use tax revenue is expected to be approximately $29 million. Staff will continue to monitor Transaction Sales and Use Tax collections through the remainder of the fiscal year and will propose budget amendments if revenues are not in line with the amended budget.
Expenses
The FY 2025/26 amended operating expenditure budget is $32.4 million as of December 2025. The year-to-date expenditures as of the preparation of this report are $15.8 million, or approximately 49% of the amended budget. The personnel budget of $13.7 million is approximately 42% of the total budget. The year-to-date personnel cost is approximately $6.4 million, or 46% of the personnel budget. At the halfway point, personnel cost is slightly below the 50% mark. This is attributable to vacancies that occur throughout the fiscal year and the number of pay periods within the first six months.
The Operations and Maintenance category is 40%, below the 50% mark. This is expected, as some expenditures are not incurred each month. Capital Outlay expenditures are typically one-time purchases and may not always reflect 50% of the budget at this point. As of December 2025, Capital Outlay expenditures are approximately 47% of the amended budget. The table below summarizes the budget and actual expenditures by category through December 2025.
FY 2025/26 Budget Adjustments
In the First Quarter Budget Update presented on December 2, 2025, City Council accepted Finance Staff’s recommendation to reduce the Operations & Maintenance budget by $80,000 for an expense that should have been budgeted in the General Fund, as well as a $2,430 increase to the Allocations category.
During the Second Quarter Budget Update presented on March 3, 2026, Finance staff recommended that the City Council amend the revenue and expenditure budgets. Based on Measure T Sales Tax collections, revenue is trending slightly above initial projections. Staff recommended increasing the Sales Tax revenue budget by $150,000. This adjustment is reflected in the table on the following page.
For the expenditure budget, the City Council approved an appropriation of $26,400 for Personnel Costs and $47,383 for a One-Time Expenditure for emergency repairs at the Fire Fleet Maintenance Building. After researching accounting guidance related to Interfund Loans, it was determined that the Interfund Loan from the Measure T Fund to the Library Development Impact Fee Fund should not be recorded as a Transfer but rather on the balance sheet. As a result, the Transfer Out budget of $3.5 million for the Loan was removed.
Based on the proposed mid-year adjustments, the Measure T Fund revenue budget is $28.9 million, while the expenditure budget is $32.5 million. The delta between revenues and expenditures will be covered from the planned use of reserves for the following purposes:
• Transfer to the Fleet Replacement Fund for the purchase of the Fire Engine type 1, the Tiller ire truck, and also to provide additional funding to establish the program.
The table below is from the Second Quarter Budget Update for FY 2025/26, which includes the City Council-approved adjustments. It is important to note that the table below may differ from the financial activities presented to the committee in this report, primarily due to the fact that financial reports are a “snapshot in time.” They reflect the data exactly as it exists at the moment the report is generated.
Expenses highlights
• 68 authorized positions funded by Measure T since inception;
- 30 Police Public Safety Positions
- 15 Fire Public Safety Positions
- 23 Non-Public Safety Positions
• 65% of Measure T Fund budget is dedicated to public safety operations;
• Police vehicles, including upfitting costs;
• Police safety equipment for new hires;
• Police taser and body-worn cameras, equipment, and software license;
• Police license plate reader software;
• Police drone equipment;
• Narcan - treatment of a known or suspected opioid;
• Fire annual hose test services;
• Fire annual ladder test services;
• Fire EMS Priority Dispatch EMD;
• Fire mapping response system and image trend annual fees;
• Fire PSEC radio system annual subscription and radio installation;
• Fire mobile data terminals;
• Fire PPE gear and safety equipment (i.e., turnout gear and other Fire Dept services and equipment);
• Fire replacement equipment (i.e., hoses and ladders);
• Replacement furniture for Fire Admin Offices;
• Wildland fire service agreement;
• Fire emergency software (i.e., table command, pulse point, CAD integration system);
• Fire station annual facilities maintenance and major repairs:
• Fire stations PPE extractors for Fire Stations 1, 2, and 3;
• Fire EMS rental agreement;
• Fire Station 2 and 3 generator replacements.
• Fire Stations maintenance/repairs;
• Economic Development data, market research, and event marketing;
• City of Murrieta’s Magazine, newsletter, and program marketing;
• Graffiti & weed abatement;
• Vehicle lease program;
• Establish and maintain the operating and sustainability reserves.
Operating and sustainability reserves
The City Council’s formal policy calls for Operating Reserves of 25% of the adopted operating budget, excluding transfers. The Measure T operating reserve balance of nearly $5.4 million fulfills the City Council's operating reserve requirement. The Measure T Fund also allocates funds to meet the Operating Reserve requirements for the Fire, CSD, and Library Districts.
In addition to the Operating Reserve, certain commitments and assignments of fund balance will help ensure adequate financial resources for planned expenses and unforeseen circumstances and events such as an economic downturn, catastrophic events, unanticipated expenses, and one-time purchases. For FY 2025/26, the Measure T Fund set aside $1,070,504 in Operating Reserves to meet the City Council’s recommended reserve balances.
Conversely, $6,280,521 is being used in FY 2025/26 across multiple reserve balances to fund the fleet replacement program, purchase of the Fire Department’s apparatus, and facility repairs. Of these balances, nearly $5.0 million was transferred from Measure T Fleet Replacement Reserve to establish the Vehicle Replacement Program, of which $3.8 million is used towards a Tiller Engine and Type 1 Engine, and $1.2 million towards general Fleet Replacement, and $35,000 from the Fire Facility Repair for emergency one-time repairs at fire stations. Similarly, the Measure T CSD Facility Repair committed $1.2 million to CIP 22039 for synthetic turf replacement at Los Alamos Hill Sports Park and Torrey Pines Park. The Total operating and sustainability reserve balances are shown in the table below. Lastly, the table below includes as an adjustment the change in fund balance classification for the $3.5 million loan from committed fund balance (reserve) to nonspendable (loan receivable) fund balance.
Fiscally responsible budgeting, prudent long-term financial projections, funds oversight, and financial transparency have strengthened the City’s reserves since the implementation of Measure T. It is consistent with the City Council's Goal to maintain a high-performing organization that values fiscal sustainability, transparency, accountability, and organizational efficiency.
Measure T is a general-purpose tax revenue source that supports the City’s operations, including emergency services such as police, fire, and paramedics; street maintenance and improvements; parks and recreation; and maintenance of public facilities, such as graffiti removal and other expenses that enhance Murrieta's quality of life. The financial report is attached to this narrative report.
Report to City Council
In accordance with the resolution that established the Advisory Transaction and Use Tax Citizens Oversight Committee, a biennial report by the Measure T Committee to the City Council on the revenue and expenditures of the Measure T Fund. Staff will work with the Measure T Committee Chairperson to prepare an agenda report to include in a future City Council meeting.
PUBLIC NOTICING
72-hour public notice requirement in accordance with the Brown Act.
CEQA AND REGULATORY OVERVIEW
None.
FISCAL IMPACT
None.
ATTACHMENTS
ATT 1 - FY 2025/26 Budget to Actual Report as of December 2025