Three weeks ago, Fullerton officials disclosed a $2.9 million accounting error that significantly weakened the City’s financial position. Since then, residents have received explanations about how the budget is structured, but not what actually happened.
The error itself is straightforward. In 2022, $2.9 million was transferred into the General Fund, the City’s primary discretionary fund, when it should have been allocated to the Successor Agency fund. That mistake went undetected until last year, meaning the City Council made policy decisions under the assumption that those funds were available when they were not. What remains unclear is how this happened in the first place, and why it wasn’t caught sooner.
At the same meeting, staff also explained that approximately $2.7 million previously considered “unassigned” is now classified as “assigned,” largely tied to the Downtown Parking Program and General Plan updates. Both programs have existed for years; the parking program since 2019, and General Plan requirements for decades, yet these costs appear in the current year’s budget in a way that was not reflected in prior projections…