TO: Mayor and City Council
THROUGH: Krishna Namburi, City Manager
FROM: Josh Eggleston, Chief Financial Officer
SUBJECT:
title
City of Salem Fiscal Year 2025 Final Year End Financial Report
Ward(s): All Wards
Councilor(s): All Councilors
Neighborhood(s): All Neighborhoods
Result Area(s): Good Governance; Natural Environment Stewardship; Safe and Healthy Community; Safe, Reliable and Efficient Infrastructure; Strong and Diverse Economy; Welcoming and Livable Community.
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SUMMARY:
summary
The Fiscal Year (FY) 2025 Year End Final Financial Report for the City of Salem reflects audited activity for the entire year through June 30, 2025. A preliminary version of this report was on the August 11, 2025, City Council agenda.
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ISSUE:
Information Only.
RECOMMENDATION:
recommendation
Information Only.
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FACTS AND FINDINGS:
The City of Salem Year End report is the most in-depth of the quarterly reports and shows several pages of financial displays and comparisons. It begins with overall impact and a fund watchlist and then shows citywide results. This is followed by an overview and analysis of General Fund financial activity, trends and actuals in all other funds, and concludes with information about vacant positions across the organization.
The final FY 2025 Year End Financial Report reflects audited financial activity from July 1, 2024, through June 30, 2025. Through the end of quarter 4, citywide resources totaled $925.2 million an increase compared to last fiscal year of 2%. Expenditures totaled $543.6 million which is a year-over-year increase of 4.7%.
General Fund expenditures continued the trend of exceeding current revenues. By the end of FY 2025, fund balance was spent down by $3.4 million. Even with this decrease in working capital, the fund remains in compliance with City Council’s fund balance policy. FY 2025 expenses increased by 5.2% compared to FY 2024.
Outside of the General Fund, there are several other funds with significant financial activity. The Utility Fund, which provides services to produce clean drinking water, treat wastewater, and convey stormwater had $136.8 million of expenses through year end. The Self Insurance Benefits Fund where employee benefits are administered and related insurance claims are paid saw total expenses of $36.7 million. The Capital Improvements Fund which accounts for large construction, equipment, and software projects had $36 million in expense, a 27.8% decrease from FY 2024.
Last is a summary of position vacancies across the City. Total positions increased over the fiscal year through mid-year additions by 67.25 Full Time Equivalent positions. 6.25 FTE were added for the Enterprise Resource Planning software implementation project. Sixty positions were added for ambulance service delivery in the Emergency Medical Services (EMS) Fund with one added in Human Resources in the General Fund to support this new service. The vacancy rate to start the year was just under 9.1% citywide and by year end it increased to 12.5% mainly from the positions added in the EMS fund remaining vacant as during their training period. Employees were hired into a seasonal status until they became career employees on July 1, 2025.
BACKGROUND:
The Budget Office has prepared quarterly financial reports and provided them to the Budget Committee for decades. Both current and historical quarterly reports can be accessed online and are available starting in FY 2016. During adoption of the FY 2025 budget, City Council approved a motion requesting reports for the General Fund be provided directly to City Council within 45 days of the end of each quarter. Staff now provide both the City and URA quarterly reports in this timeframe for consistency.
Kali Leinenbach
Budget Manager
Attachments:
1. FY 2025 City of Salem Year End (Quarter 4) Final Financial Report