FY 2425 2526 Recommended Operating Budget

4. New Sewer Trunk Line ($58.7 million): The construction of a new parallel sewer trunk line is intended to facilitate the City's planned growth and to mitigate capacity constrictions in the existing trunk line. The project will span the distance between Highland Avenue and Renz Lane in Gilroy. 5. Water Pipeline Repair and Replacement ($4.5 million): An ongoing program to replace aging and failing pipelines throughout the water system. This includes multiple improvements to mitigate existing water system deficiencies, increase hydraulic reliability and/or replace existing pipelines due to poor condition or operational considerations. 6. Groundwater Wells ($11.2 million): This project includes the planning, design, and construction of new groundwater wells. The new wells will be constructed to provide redundancy and reliability for the City’s Water System. 7. Fisher/Butterfield Storm System ($3.3 million): The expansion will increase retention of stormwater reducing the risk of flooding in the area and downstream through Fisher Creek. The City’s full -time and part-time employees are the most important resources for the delivery of its high-quality services. Annual investments in personnel account for approximately $53.3 million or 26% of organization-wide expenses in FY 24-25 and $55.8 million or 22% in FY 25-26. Of this amount, 69% is related to salaries and the remaining 31% is attributed to benefits (health insurance, retirement, etc.). The City continues to maintain its personnel expenses by continuing to work with other organizations to collaboratively deliver services; most notably, with the YMCA for recreation services, Cal Fire for fire/emergency medical services, HouseKeys for Below Market Rate Housing program, and the City of Gilroy for wastewater treatment services. The Council’s Long - Term Labor Policy, Principles, and Strategies’ Principle No. 4 – Fiscal Sustainability and Economic Climate states that “all compensation commitments must be made consistent with principles of fiscal sustainability and to ensure the City’s long -term success in achieving its mission.” As part of this principle, “the City will strive to hire contract employees instead of full-time benefitted employees to allow for greater flexibility during periods of peak demand.” The City continues to adhere to this principle throughout the organization and especially in Development Services. The City has contracted to augment its team in the planning, building, and land development engineering services to ensure we have the necessary resources to satisfy the expectations of the development community. Personnel

BUDGET MESSAGE 25