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City Ends 2025 With $6.6 Million Surprise Surplus, Defying Forecasts

A Fiscal Turnaround Fueled by Revenue Gains and Cost Controls

The city closed out 2025 with a far smaller-than-expected deficit of $3 million, a dramatic improvement over the projected shortfall of $9.6 million, interim Finance Director Mark Holloway revealed to the council this week. Holloway, who took the helm just two weeks prior, credited the turnaround to stronger-than-anticipated revenues—particularly in earned income and real-estate transfer taxes—each of which exceeded last year’s totals by roughly $2 million.

The rebound came even as some revenue streams fell short, including declining interest earnings from bank accounts, which dropped due to lower interest rates. Emergency medical service collections also staged a strong recovery after a cyberattack-related disruption in 2024 had temporarily stalled billing.

Balancing Act: Revenue Rebound vs. Rising Costs

While higher revenues provided relief, escalating expenses—particularly in salaries and benefits—jumped by $6 million due to wage contracts and new hires. Holloway, who admitted his team is still assembling a complete financial picture, stressed that the city’s ability to stay within striking distance of budget was a hard-won victory.

A Push for Greater Transparency

Holloway outlined plans to overhaul financial reporting, including:

• Quarterly reports comparing budgeted vs. actual spending.
• Clearer expense categories, with departments barred from lumping costs under vague labels like “other expenses.”
• More granular breakdowns to improve accountability.

Council members unanimously supported the push for detailed spending reports, especially regarding contracts, as a way to root out inefficiencies.

Leadership Responds: Praise and Fresh Ideas

City Auditor Maria Rodriguez commended the strong revenue performance, while Managing Director Jack Gombach highlighted the interim finance director’s innovative cost-saving proposals as a key driver of the improved outlook.

With year-end results showing better-than-feared outcomes and a new focus on financial discipline, city leaders now see a clearer path to stabilizing budgets and avoiding future shortfalls.

Could this be the start of a more transparent, fiscally responsible era?