Agenda Item Wording:
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Measure N 10-year plan and proposed two-year budget - Review the proposed 10-year plan (2027-2037) and approve the 2026/27 & 2027/28 proposed budget.
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Agenda Date: 03/16/2026
Prepared by: Renee Nagel, Finance and Technology Director,559-713-4375, Renee.Nagel@visalia.gov, Amee Swearingen, Budget Analyst, 559-713-4170, Amee.Swearingen@visalia.gov
Department Recommendation: Review the proposed 2027-2037 10-year plan for Measure N and approve the 2026/27 & 2027/28 proposed budget.
Summary:
Measure N has been able to enhance the City by adding and equipping 57 essential positions, growing youth services, and improving streets, parks, trails, and buildings over the last nine fiscal years. Next fiscal year completes the original plan. The proposed new 10-year plan is a continuation of current services and continues to add additional resources.
Background Discussion:
In November of 2016, the voters of Visalia passed a ½ cent Sales Tax Override, Measure N also known as Visalia Essential City Services Measure. Sales Tax from Measure N provides essential city services such as police, fire, and recreation, as well as maintenance of parks, trails, and roads. The measure uses a detailed, 10-year plan which includes hiring of personnel, construction of capital projects and equipment purchases.
As part of the measure, Council adopted an Accountability Ordinance (Ordinance 16-21) to establish accountability measures as outlined:
Revenue Requirements:
• 10% of budgeted revenues must be maintained in an Uncertainty Fund. This money can only be accessed during a fiscal emergency;
• 10% of budgeted revenues must be deposited into the following two categories:
o 2% into Youth Programs
o 8% into Maintenance and Emerging Needs
Expenditure Requirements:
• Tax money shall not be used for debt service payments;
• The annual expenditure plan must be approved by Council after the following process has occurred:
o City Manager makes a recommendation to City Council and makes changes as requested by Council;
o Staff receives comments and recommendation by Sales Tax Oversight Board;
o Staff conducts two public hearings at regular Council Meetings to consider expenditure plan.
Sales Tax Oversight Board:
The Oversight Board will consist of 11 members that are appointed by Council and various organizations that will serve two-year terms. Members may be reappointed to serve up to two additional two-year terms (total of 3 terms).
Annual Procedural Review:
Each year the City shall provide an annual Independent accountants’ aeport on Applying agreed-upon procedures to account for the tax revenues received and expenditures made to ensure consistency with the program guidelines and expenditure plans. This report was recently presented to Council in January 2026 with the City’s financial statements for FY 24/25.
Effectiveness Reviews:
The ballot measure ordinance requires an effectiveness review every eight years from the operative date of the ordinance. The operative date is April 1, 2017; thus, the first review must occur on or before April 1 every 8 years. The first effectiveness review was presented to Council on March 17,2025 and was approved to continue for another 8 years (2033).
Current 10-Year Plan:
The plan is currently in the 9th year and has had amendments throughout the years to add additional staff, programs and capital. The final year of the original plan is FY 26/27 and is the first year of the upcoming two-year budget that is currently being prepared. A new plan will need to be approved to allow the second year of the proposed budget (FY 27/28) to be appropriated. Below is the current amended 10-year plan’s elements broken out by category.
Essential Services
Police:
• Hired personnel and purchased the required equipment & vehicles for the following positions:
o 29 Police Officers
o 4 Community Service Officers
o 11 Professional Staff
• Implemented the body worn camera program and continue to fund with Measure N
Streets:
• Funds approximately $4 million annually which totaled $39.5 million over the 10 year plan.
• Completed the Downtown Street Light Replacement Project totaling $9.2 million.
Fire:
• Funded personnel and purchased the following equipment & vehicles:
o Funded 1 Administrative Captain and 1 Deputy Chief
o Purchased Ladder Truck
o Purchased Mobile Aire Truck
• Constructed Station 56 located on Lovers Lane
• Design and Construct Station 51
• Implemented Paramedic Squad Program which consisted of hiring personnel & purchasing equipment & vehicles for the following positions:
o 6 Paramedics
o 1 EMS Coordinate
Parks and Recreation:
• Hired Personnel and purchased essential equipment & vehicles for the following positions:
o 1 Landscape Inspector
o 1 Park Maintenance Technician
o 1 Park Maintenance Worker
o 1 Recreation Coordinator
• Funded additional maintenance for a total of $2.2 million over 10 years. Each category received approximately $55 thousand annually:
o Trailway maintenance
o Tree maintenance
o Building maintenance
o Parks maintenance
Maintenance & Emerging Needs 8%
• Funded deferred building maintenance totaling $6.3 million over the last nine years.
Youth 2%
• Set aside $2.4 million for youth programs. Of this $1.2 was spent over the last 9 years:
o Manual Hernandez Clubhouse
o Funded grants for youth programs
o Funding for the PAL League Activities
Uncertainty Fund Balance
• Maintained the Uncertainty Fund at 30% of operating expenditures. As of June 30, 2025, the amount was $3.1 million.
• A new policy was adopted in June 2024 that changes the calculation to be the same as the General Fund Reserve which is 30% of operating expenditures from 10% of budget revenues.
Proposed New 10-Year Plan:
The new proposed 10-year plan continues with the original intent of the plan to provide essential city services and maintenance of parks, trails and roads. The plan will continue to fund everything that is in the current 10-year plan plus add additional full-time employees, capital and increase maintenance funding. Below are the additional items being proposed to add by category.
Essential Services
Police:
• Hire personnel and purchase the required equipment & vehicles for the following positions:
o 7 Police Officers
o 2 Community Service Officers
o 2 Professional Staff
Streets:
• Annual street maintenance of $4 million increasing by .05% annually.
Fire:
• Design and Construct Station 57
• Purchase Station 57 engine
• Hire 3 of the required 9 full-time employees for Station 57
Parks and Recreation:
• Annual Trailway, Tree, Building and Parks maintenance increasing 2% annually:
Maintenance & Emerging Needs 8%
• Building maintenance of $1.1 to $1.5 million annually
• Remainder of the 8% of budget revenues to fund emerging needs
Youth 2%
• Fund a total of 2% of budgeted revenues for Police and Recreation youth programs
Uncertainty Fund Balance
• Maintain the Uncertainty Fund at 30% of operating expenditures.
The cost associated with the next 10-year plan which includes the current staffing, current programs, capital, and proposed additional expenditures is shown in Table 1: Measure N Next 10 Year Plan Projection.
Table 1: Measure N Next 10 Year Plan Projection
The proposed plan was established in order to be balanced, with the forecasted revenues covering expenditures. Sales Tax revenue was forecasted conservatively by growing 2.5% in the first two years and then growing 3% every year after that. Staff was conservative with ongoing expenditures but still able to add personnel and increase annual maintenance. The new fire station (Station 57) is using cash from fund balance. If revenues are higher and/or expenditures are lower then the plan, the annual budget can be amended to add one-time capital projects or increase the annual street maintenance. Staff encourage street maintenance to be high on the list to receive additional revenues as available due to streets maintenance receiving a lesser percentage increase annually than the other categories. Costs associated with street maintenance is growing due to new development and rising costs. Like the first plan, elements can be moved forward or pushed out based on needs.
The detailed sheet showing each year of the plan and when elements are added is included as Attachment A.
2026-2027 & 2027-2028 Proposed Budget
To ensure that the Measure N budget will be adopted with the rest of the City funds in June; staff is presenting the recommended fiscal year 2026/27 & 2027/28 budgets to start the approval process. FY 2026/27 is the last year of the current 10-year plan and is budgeted according to the plan. FY 2027/28 reflects the first year of the proposed 10-year plan. If Council makes changes to the proposed plan tonight, staff will adjust the budget to reflect the changes.
The budget includes the amended expenditure plan as shown in Table 2 - 2026/27 Proposed Measure N Plan (Year 10). The recommended budget for the 2026/27 budget is $39.6 million. This budget does not include any expenditures for the Emerging Needs category which will be brough back to Council and the Oversight Committee once a policy and/or plan has been established.
Table 2
2026/27 Proposed Measure N Amended Plan (Year 10)
In FY 2026/27, the plan adds 1 professional staff and 2 police officers for the Police Department. The budget for these positions includes equipment and vehicles. In addition, staff is requesting three additional amendments to the plan.
The first amendment is to replace a 2021 patrol unit (212664) that was involved in a front- end collision resulting in a total loss in March 2024. The replacement cost is $109,000. Staff is requesting to appropriate $109,000. This vehicle is multi-funded with $91,500 being funded from Measure N Essential Services Fund and $17,500 from the Measure N Vehicle Replacement Fund.
Second amendment is to add an additional appropriation of $21 million for the construction of Fire Station 51. If the costs come in lower than estimated, any remaining funds will go back to fund balance. The construction contract is anticipated to be awarded in fall of 2026.
Third amendment is adding back the building maintenance project in the Maintenance and Emerging Needs Fund (8%). As outlined in the plan, the building maintenance project was funded in the first five years and was not funded in years 6-10. Staff recommends funding the building maintenance project in FY 2026/27 for $1.5 million. This project was originally established to replace and update facilities that are funded by the General Fund. Unfortunately, the 5 years of funding was not enough to cover the high costs to replace/repair roofs, replace HVACs, and repair facilities.
The recommended budget for FY 2027/28 is $19.2 million as shown in Table 3 - 2027/28 Proposed Measure N Plan (Year 11).
Table 3
2027/28 Proposed Measure N Amended Plan (Year 11)
In FY 2027/28, the plan adds 1 professional staff and 1 police officer for the Police Department. The budget for these positions includes equipment and vehicles. All other expenditures increased based on estimated costs and growth per the proposed plan.
Measure N Sales Tax
Measure N sales tax is projected to be higher than the plan as shown in Table 4 - Measure N Sales Tax Projections. This large difference is due to several reasons: the plan being conservative, Visalia continuing to have growth in commercial and residential development, higher cost of goods which increases sales tax, and new regulations on how sales tax is collected and paid from e-commerce purchases.
The table also shows a spike in sales tax in FY 20/21 & FY 21/22 due to the multi-year COVID stimulus money that the Federal Government issued. This one-time money lead to a decrease in FY 22/23 and 23/24 which allowed the sales tax to realign. Last fiscal year, Measure N sales tax increased by 1.8% and is projected to have growth of 2.5% for FY 25/26, 26/27 and 27/28.
Table 4
Measure N Sales Tax Projection
In order to meet the requirements of tracking revenues and expenditures by categories, Measure N is tracked in 5 separate funds. Essential Services, 2% Youth Programs, 8% Maintenance and Emerging Needs, Economic Uncertainty, and Vehicle Replacement. Table 5 - Measure N Fund Balance Summary, shows each fund’s projected ending cash for both years based on the proposed 2-year budget.
Table 5
Measure N Fund Balance Summary
Measure N Economic Uncertainty Fund
The Measure N policy for the economic uncertainty fund was amended last fiscal year to be 30% of operating expenditures instead of 10% of budgeted revenues. The balance of the uncertainty fund is $1.2 million as of June 30, 2025.
Budget Process
Staff is recommending for Council to approve the next 10-year plan and the two-year budget. If approved by Council, staff will present both items to the Measure N Oversite Committee for comments and will return to Council to conduct two public hearings. Any changes made to the new 10-year plan will be incorporated in the budget recommendation.
Fiscal Impact including annual maintenance and operating costs: None
Prior Council Action: N/A
Alternatives: N/A
Recommended Motion (and Alternative Motions if expected):
recommendation
I move to approve the proposed 2027-2037 Measure N Plan and the fiscal year 2026-27 & 2027-28 budgets and continue with the Measure N expenditure approval process.
Environmental Assessment Status: N/A
CEQA Review: N/A
Deadline for Action: 06/30/2026
Attachments: Attachment 1 - Measure N 10-Year Plan (2027-2037)
Strategic Goal: Indicates which City Strategic Goal(s) this item supports. Check all that apply.
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