An independent review of Arcadia’s 2024-25 financial condition revealed a $4.6 million surplus, a significant turnaround from a projected $2.2 million deficit, city officials announced Thursday.
By September 2024, City Council approval of five labor union agreements resulted in the possible shortfall. But by June 2025, updated forecasts indicated that a balanced budget was most likely, officials said. As in previous years, actual finances turned out to be more favorable than projections. According to a statement from the city, “stronger revenues, disciplined spending, and routine timing and supply chain delays for certain capital projects” led to the surplus.
The audit revealed favorable performance with revenue as well as the expenditures, officials said.
Tax collections exceeded projections by $1.6 million. Higher tax collections on sales, utilities, property and hotel stays led the way, officials said. Investment income added an additional $1.3 million to the city’s coffers, and additional revenue growth came from fees, fines and charges for services, including about $150,000 for code enforcement, $150,000 for engineering services, $300,000 in grants and $400,000 from reimbursements related to Fire Department Strike Team deployments.
Budget savings primarily resulted from “normal capital project scheduling and supply chain delays, lower-than-anticipated personnel costs, and the deferral of a voluntary contribution to help stabilize employee pension costs,” according to the city. Capital and equipment spending was around $2.5 million less than expected, with most of the costs carried forward into fiscal year 2025-26 that began July 1.
“Following the favorable results of the audit, the City will proceed with transferring the $1.0 million previously set aside to help smooth pension costs,” according to the city’s announcement.
While the labor contracts for city employees initially signaled a challenging budget year, higher revenue growth and disciplined spending helped Arcadia turn a multimillion-dollar deficit into a $4.6 million surplus, officials said.
“Our employees are the foundation of Arcadia’s success, and the City Council ensured that our labor agreements reflect their vital contributions to the community,” City Manager Dominic Lazzaretto said in a statement. “Their foresight to invest in our workforce contributes to Arcadia’s long-term vitality, helping our community remain a place where people want to live, work, and play.”
Arcadia’s FY2024-25 financial audit will be available on the city’s website in the coming weeks, officials said, adding that questions about the audit can be directed to the Administrative Services Department by calling 626-574-5424.
Moss Levy & Hartzheim performed the city’s 2024-25 audit.
Updated Jan. 15, 2026, 11:38 a.m.
