Fiscal Transparency and Sustainability

This webpage serves to inform Cerritos residents regarding key aspects of the City's budget that drive how we do business now and into the future. 

Overview

The City of Cerritos is committed to responsibly managing our public resources that support our long-term financial goals and strengthen our future. This commitment to fiscal transparency and sustainability is prioritized in our Strategic Plan and is symbolic of our Cerritos in Progress theme. We invite Cerritos residents to engage in the Fiscal Year 2026-2027 Budget planning process. Through increased fiscal engagement, we’ll progress together in building a bright future for Cerritos.

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Budget Meeting Dates | Budget News | Informational Charts | FAQs

Budget Meeting Dates

You’re invited to engage in the annual budget process and learn more about how the City operates.  The process includes multiple community workshops, City Council budget study sessions, and concludes with a public hearing and formal budget adoption. 

Upcoming Events

  • April 15, 2026: Community Budget Workshop; 
    • 7 p.m., Cerritos Senior Center at Pat Nixon Park
  • April 21, 2026: Community Budget Workshop;
    • 7 p.m., Virtual Meeting (Link Pending)
  • May 11, 2026: Budget Study Session #2; Cerritos City Council meeting
    • 7 p.m., City Council Chamber
  • June 8, 2026: Budget Study Session #3; Cerritos City Council meeting
    • 7 p.m., City Council Chamber
  • June 22, 2026: Public Hearing and Budget Adoption; Cerritos City Council meeting
    • 7 p.m., City Council Chamber
  • July 1, 2026: Fiscal Year 2026-2027 begins

March 9, 2026: City Council meeting

  • 9B: Review and consideration of the City of Cerritos Annual Comprehensive Financial Report for Fiscal Year 2024-25.
  • 9C: Review and Consideration of the Fiscal Year 2025-2026 Midyear budget update and proposed Fiscal Year 2025-2026 Budget amendments. 

December 11, 2025: City Council meeting

  • 9A: Review and consideration of information related to the FY 2026-2027 budget development process and Strategic Plan update (Budget Study Session #1)

December 2025: Budget at a Glance mailed

  • A Budget at a Glance document was mailed to Cerritos residents in December 2025 to provide clarity on projected Citywide expenses and revenues for Fiscal Year 2025-2026. 

Budget News

News articles from the City of Cerritos on the budget process, key initiatives, and dates.  

City Council Reviews Alternative Revenue Sources, Directs Dual Budget Planning Framework

March 11, 2026 - The Cerritos City Council on March 9 directed staff to conduct further evaluation of a potential 1% Transactions and Use Tax (TUT) that would support additional revenues and future water and sewer rate relief. The action followed a presentation by staff at the direction of the City Council on multiple alternative revenue sources. Among the alternative revenues evaluated at the meeting, a 1% TUT would generate substantially greater ongoing revenue than the others.

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Informational Charts

Citywide Total Revenues by Fund Type

City of Cerritos revenues are comprised of six fund types. The General Fund accounts for the largest source of City revenue. 

Citywide revenues by fund type chart

General Fund revenues

Sales tax revenues make up nearly half of the overall General Fund. Out of the 9.75% sales tax paid by consumers, the City receives 1%. For each dollar spent in Cerritos, the City receives one cent. 

General Fund revenues and sales tax allocation chart

Citywide Operating Expenditures by Service Type

Citywide operating expenditures fund public safety, maintain infrastructure, support community amenities, and provide high quality services for residents. 

Citywide expenses by service type chart

Capital Improvement Program (CIP)

CIP projects are prioritized based on critical need and intended to support reasonable and controlled growth. 

Capital Improvement Program project chart

10-Year Forecasted Expenditures and Revenues

Expenditures are projected to outpace revenues over time, resulting in recurring structural deficits. 

10-year forecasted expenses and revenues chart

10-Year Forecasted General Fund Reserves

General Fund reserves are declining steadily and are projected to fall below the City's minimum reserve policy threshold within the forecast period. As reserves diminish, the City's flexibility to fund capital improvements, address infrastructure needs, and maintain current levels of service becomes increasingly constrained.

Forecasted General Fund Reserves chart

Forecasted General Fund Expenditures and Revenues (With 1% TUT)

The chart below models the addition of a 1 % TUT beginning in Fiscal Year 2026-27, consistent with the revenue estimate prepared by HdL Companies. Under this scenario, a 1% TUT would produce sustained growth in reserves above the City's minimum policy target. The forecast demonstrates not only compliance with reserve policy, but the accumulation of financial capacity beyond required levels over time.

10-year General Fund chart with 1% Transactions and Use Tax

Forecasted General Fund Reserves (With 1% TUT)

The chart below models the addition of a 1% TUT beginning in Fiscal Year 2026-27, consistent with the revenue estimate prepared by HdL Companies. Under this scenario, a 1% TUT would produce sustained growth in reserves above the City's minimum policy target. The forecast demonstrates not only compliance with reserve policy, but the accumulation of financial capacity beyond required levels over time. 

Forecasted General Fund Reserves with 1% TUT chart

Frequently Asked Questions

The City collects revenues through multiple methods which are distributed to different fund types. Those funds pay for certain services to support Cerritos residents, businesses, and visitors.  The General Fund is the City’s primary operating fund, with nearly half of the fund accounting for sales tax revenues. Cerritos is a “no-low” property tax city, so a small percentage of property taxes contribute to the General Fund. Other revenue sources include the City’s Enterprise Funds, such as the Water Fund and Sewer Fund. Enterprise funds are general paid for by user fees.

Cerritos has a sales tax rate of 9.75% and the City keeps 1% of that total amount. That means if you buy an $8 coffee or boba drink from a local cafe, the City receives 8 cents from the sales tax on that drink. If you’re someone who picks up the same drinks weekly, the City would receive 32 cents over the course of a month. By comparison, nearby cities like Bellflower receive 1.75% from their 10.5% sales tax rate. For the same $8 coffee or boba drink, cities like Bellflower receive 14 cents from the sales tax on that drink, or 56 cents over the course of a month.

The City of Cerritos is projected to generate $43.8 million in sales tax revenue during the 2025-2026 Fiscal Year. Sales tax is one of the community’s main funding sources, helping support essential services such as public safety, street maintenance, parks, and community programs. Residents and visitors alike contribute to the City’s sales tax revenues, whether they’re purchasing everyday household goods at Cerritos Towne Center or shopping at a department store at Los Cerritos Center.  

Cerritos is considered a “no-low property tax” city, meaning the City receives a smaller share of property tax revenue than surrounding cities. As a result, the City relies on other revenue sources, such as sales tax and fees, to support essential services for the community.

A TUT, commonly referred to as a local sales tax, applies to taxable retail transactions for some goods and services occurring within the City and to certain purchases allocated through the countywide use tax pool. Adoption of a TUT would require direction by the City Council to place the item on a ballot and then approved by simple majority of voters. Estimates prepared by the City’s sales tax consultant, HdL Companies, projects that a 1% TUT would generate approximately $19 million annually for the City. More than half of would come revenue from a potential TUT would be generated by non-residents.

A dual budget framework would allow the City Council to consider adoption of either a primary budget scenario or contingent budget scenario. City staff will prepare both budget scenarios. Based on City Council direction, staff will prepare a primary budget scenario that assumes approval and implementation of additional ongoing General Fund revenue, including a voter-approved TUT.  At the same time, staff would prepare a contingent budget scenario that would take effect in the event such revenue is not approved. Should additional ongoing revenue not be approved, the contingent budget would result in expenditure reductions and service level adjustments.

For More Information

Visit the Budget and Finances webpage, or contact the Finance and Budget Division by calling the Administrative Services Department at (562) 916-1355 or submit a notice through the online form. 

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