City staff presented CalPERS 06/30/2025 valuation: CalPERS returns strengthened funded status, UAL fell to $504M, CalPERS-only funding ~70.8% and combined with the city Section 115 trust to ~78.4%; committee accepted the transmittal unanimously.

City staff told the Finance Committee on May 6 that the proposed FY27 budget totals about $1 billion, with a $311.1 million General Fund and a projected $17.1 million gap the committee will address through cuts, fee increases and one-time draws over two days of workshops.

The Palo Alto Finance Committee voted unanimously to forward staff-recommended revisions to the city's investment policy to the full council. The changes authorize more active portfolio management, switch reporting to market value, expand allowable corporate credit to single-A with mitigation, and add operational controls with Chandler Asset Management.

City staff presented the FY2027–36 long‑range financial forecast showing a projected structural deficit of $14.9 million in FY2027 driven primarily by sales tax declines and slower property tax growth; the Finance Committee unanimously forwarded the forecast and budget development guidelines and discussed a package of revenue and expenditure options to close the gap.