Summary

Retreat sets budget and policy direction

Foster CityFeb 10, 20261 min read

At a glance

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Council directed staff to disband the Audit Committee, lower General Fund reserves closer to 50% of annual operating spending, and make a $20 million payment to CalPERS to reduce pension debt.

Committees mentioned

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City Council/EMID

Topics discussed

Budget & Tax

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What this means

At its annual retreat, the Council gave staff a broad set of directions on committee procedures, proclamations, flag policy, reserves, and budgeting. The biggest financial step was a planned $20 million payment from General Fund reserves to CalPERS to partially pay down the City’s unfunded pension liability. The Council also asked staff to return with options for new reserve types and to prepare for a two-year budget cycle beginning with FY 2026-2027.

Key decisions

Follow the major takeaways from this briefing.

Proceed with disbanding the Audit Committee and return a resolution at a future Council meeting.
Update the committee application question to focus on relevant skills, experience, and collaborative mindset.
Hold separate Council special meetings in the Emergency Operations Center for committee applicant interviews.
Limit Councilmembers to one follow-up question each, submitted in advance to the City Clerk.
Require a sample proclamation on the proclamation request form.
Automatically schedule annual proclamations for Black History Month, AAPI Heritage Month, Jewish American Heritage Month, LGBTQIA+ Pride Month, and Juneteenth.
Amend the City flag policy to include the LGBTQIA+ Pride Flag so annual approval is no longer needed.
Reduce General Fund reserves to closer to 50% of annual operating expenditures.
Make a $20 million payment from General Fund reserves to CalPERS to partially pay down the City’s Unfunded Accrued Liability.
Return during the next budget process with options and recommendations for different types of reserves.
Transition to a biennial two-year budgeting model for the FY 2026-2027 budget cycle.

Timeline & follow-ups

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Meeting information

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City Council Annual Retreat

Feb 10, 2026, 5:00 PMCITY OF FOSTER CITY/, ESTERO MUNICIPAL IMPROVEMENT DISTRICT, FOSTER CITY COUNCIL CHAMBERS, 620 FOSTER CITY BOULEVARDcompleted

Agenda

City Council Annual Retreat
4.1.
Decision: 4. STUDY SESSION

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