TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Javier Carcamo, Finance Director
PREPARED BY: RN Mendoza, Financial Analyst
SUBJECT:
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CIP Budget Workshop - Proposed Capital Improvement Plan FY 2026/27 to FY 2030/31
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ABSTRACT
This report provides an overview of the City’s proposed Capital Improvement Plan (CIP) for Fiscal Years 2026/27 to 2030/31 and Budget for Fiscal Year 2026/27. In addition, staff intends to present projects for discussion to ensure alignment with the City Council’s project prioritization as discussed during the February 26, 2026, City Council Goals Workshop. Staff requests direction from the City Council prior to the proposed adoption of the CIP budget on July 7, 2026.
RECOMMENDATION
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Discuss and provide direction to staff regarding the Proposed Fiscal Year 2026/27 Capital Improvement Budget and the Proposed Fiscal Years 2026/27 to 2030/31 Capital Improvement Plan.
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PRIOR ACTION/VOTE
On May 27, 2026, the Planning Commission adopted a Resolution , recommending to the City Council that the City Council find that the proposed Capital Improvement Plan FY 2025/26-2029/30 was in conformance with the City of Murrieta General Plan (Vote: 4-0).
On June 3, 2025, a joint resolution of the City Council of the City of Murrieta and the Boards of Directors of the Community Services District, Murrieta Fire District, and the Successor Agency for the Murrieta Redevelopment Agency adopted a series of Resolution Nos. (25- 4836, MLB-25-200, CSD 25-284, and RSA 25-34) approving the Capital Improvement Budget for FY 2025/26 and approving the FY 2025/26-2029/30 Capital Improvement Plan (Vote: 5-0).
STRATEGIC ALIGNMENT
The City Council’s goal of maintaining a high performing organization that values fiscal sustainability, transparency, accountability and organizational efficiency is associated with this administrative priority.
DISCUSSION
This report presents to the City Council the proposed Capital Improvement Plan (CIP) and budget for Fiscal Years (FY) 2026/27 to 2030/31, which provides funding for the City’s capital projects for FY 2026/27 and planning for the following four years.
The City of Murrieta’s (City) Capital Improvement Plan establishes a master plan and long-term funding strategy to implement non-recurring and recurring major construction or repair projects. CIP projects may include:
1. Acquisition of land and right-of-way;
2. Construction of buildings, roadways, bridges, drainage, and parks, including major repair, reconstruction, and/or replacement of existing Capital Assets; and
3. Purchase of major equipment.
For FY 2026/27, the proposed CIP includes a request to appropriate $37,033,549 for new projects and changes to existing projects. This is in addition to $88,195,712 in remaining committed funds for previously approved, ongoing projects, bringing the total CIP budget for FY 2026/27 to $123,229,261. Exhibits A & B of this report provide a draft summary of the new and existing projects that make up the $37,033,549 in new and budget adjustment requests as part of the proposed CIP budget. Funding for these projects is provided by a variety of revenue sources, including Development Impact Fees, transportation funds, grants, and special revenue funds restricted to the purposes for which they are budgeted. For the most part, these funds are restricted and cannot be used to support general City operations. The table below summarizes the proposed FY 2026/27 CIP budget, including both the proposed new appropriations and the reallocation of previously approved appropriations to higher-priority projects.
Funding Sources
The Capital Improvement Plan (CIP) is supported by a variety of restricted and unrestricted funding sources, each designated for specific types of capital projects and infrastructure improvements. As summarized in the table below, the proposed FY 2026/27 CIP appropriations include both new funding and the reappropriation of previously approved but unspent project budgets totaling approximately $37.0 million.
FY 2026/27 New Projects and Appropriation
California Government Code section 65401 requires that a list of proposed capital improvement projects be sent to the city planning agency for review and to report on conformity with the adopted General Plan. The purpose of the review does not include reviewing or recommending the
individual CIP projects. Staff has brought these projects forward to the City’s Planning Commission (PC) on May 27, 2026, for the sole purpose of determining whether the CIP projects are consistent with the goals and policies of the City’s General Plan 2035 (GP).
Staff identified nineteen (19) new projects and brought them forward before the PC, and the projects were found to be consistent with the GP. This includes sixteen (16) new projects and three (3) annual recurring projects. A summary is included as Exhibit A. Staff proposes new appropriation totaling $4,467,000 for new projects and $3,092.226 for existing maintenance-related projects, as well as the City Council priority projects using General Fund, Gas Tax Fund, and Measure A Funds.
Reappropriation of Existing CIP Budget
City Council Top Projects
In the Fall of 2025, the City Manager and staff held several prioritization meetings with different departments. The departments removed projects that were consolidated, duplicated, completed, or closed. Staff proposes changes to 83 existing projects, resulting in a net reappropriation of $32,566,549 to be reallocated in the next fiscal year, FY 2026/27. This will provide reallocation of funding to existing priority CIP projects that are not fully funded. . Staff, with direction from the City Manager, has prioritized funding for the nine (9) City Council priority projects including: I-215/Keller Road Interchange Project, Fire Station 6, Life F Drainage Channel, CalOaks Revitalization, MSD Yard Offices, Fire Department Training Tower, , Citywide Beautification Improvements Project, City Hall First Floor Improvements Project, and Phase 1 of the Police Department Building Expansion (parking lot improvements).
In February 2026, the City Council held a City Council Goals Workshop to prioritize capital improvement projects in conjunction with the City’s administrative objectives. Through this collaborative effort, staff have established a comprehensive three-tiered ranking system designed to ensure that funding is prioritized for the most impactful projects that align with the City Council’s goals and vision. Comprehensive details of the projects can be found as attachments to this report. As summarized in the table below, the estimated total cost of these top-priority projects is $146.9 million. The CIP funding plan identifies approximately $31.0 million in currently committed funding sources, along with an additional $38.6 million in proposed funding resulting from the project consolidation and reallocation. If the City Council approves the FY 2026/27 CIP Plan and Budget, the estimated remaining funding needed to fully fund these projects will be approximately $77.2 million. It’s important to note that these priority projects are still in very early planning stages. For that reason, projected costs are rough estimates. Similarly, the proposed additional funding does not include potential sources such as grants, state and federal appropriations or other external sources. 
Existing CIP Projects
Staff also propose ongoing maintenance projects totaling $3,092,226. These three (3) maintenance projects are the FY 2026/27 Citywide Asphalt Resurfacing, the FY 2026/27 Pedestrian Safety Enhancement, and the FY 2027/28 Citywide Slurry Seal. These projects are regularly included in the CIP budget and help the Public Works and Municipal Services departments conduct and facilitate smaller-scale citywide projects. The FY 2027/28 Slurry Seal project will be allocated its Measure A funding in the next CIP budget cycle once staff receives confirmation of the allocation of funds from Riverside County Transportation Commission (RCTC). The Pedestrian Safety Enhancement project will receive allocation once the County of Riverside allocates the Community Development Block Grants (CDBG) funds in the Fall of 2026. The allocation includes an increase of approximately four percent (4%) from the prior year as staff anticipate potential increases due to inflation.
Staff also propose adding additional appropriations to nine (9) existing CIP maintenance projects to complete ongoing work. The appropriation comes from the reallocation of funds from the consolidation of duplicated projects and from savings from existing projects. The proposed work includes various citywide maintenance-related projects, phase two of the synthetic turf replacement for the football field at Los Alamos Hills Sports Park, and design and construction of citywide electric vehicle charging stations.
Annual CIP Budget Adoption
Annually, the City Council, pursuant to California Government Code section 65403, adopts the five-year CIP to appropriate funding for new projects and to amend existing projects as needed. Staff will bring this item back to the City Council on July 7, 2026, considering City Council directions during the CIP Budget Workshop. After the public hearing on the CIP Budget is held, the City Council will be asked to consider adopting the CIP Budget. Staff is bringing forward a CIP budget and a plan that addresses two of the City Council’s goals:
1) Maintain a high-performing organization that values fiscal sustainability, transparency, accountability, and organizational efficiency; and
2) Plan, program, and create infrastructure development.
Summary of Proposed CIP Budget Adoption
On July 7, 2026, staff proposes a carryover budget of $86,195,712, with $37,033,549 in proposed new appropriations and changes to previous appropriations from various funding sources for new and existing projects, for a total budget of $123,229,261.
PUBLIC NOTICING
The agenda item has been noticed according to the Brown Act.
CEQA AND REGULATORY OVERVIEW
This action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly. The individual projects will be evaluated in accordance with the CEQA Guidelines prior to implementation.
FISCAL IMPACT
This is an informational report only. There are no fiscal impacts associated with conducting the CIP budget workshop.
ATTACHMENTS
ATT 1 - New and Annual Recurring CIP Projects Request Summary
ATT 2 - Draft Proposed Capital Improvement Plan FY 2026/27 to 2030/31