The City of Dallas announced on April 24 that it is taking immediate steps to contain costs in response to a projected shortfall in the General Fund for the fiscal year 2025–26. The city forecasts expenses exceeding the budget by $16.4 million, mainly due to Police and Fire pay and overtime, while revenues are expected to fall $3.8 million below budget because of declining sales tax collections. Additionally, the city’s self-funded Employee Health Benefit Fund is projected to surpass its budget by $13.8 million due to increased medical and pharmacy claims.
These financial challenges have prompted several actions effective immediately. The city has instituted a selective hiring freeze for all non-uniform positions in General Fund departments through the end of the fiscal year, with limited exceptions for mission-critical roles. Non-uniform overtime is eliminated except where essential, and discretionary uniform overtime is suspended. Departments are required to limit expenditures strictly to essential needs and delay non-essential purchases, while all non-essential travel for both uniformed and non-uniformed employees is paused until further notice.
According to city officials, non-essential spending includes items that can be postponed without affecting core operations or public safety, while mission critical activities are those whose interruption could cause significant negative impacts such as major operational disruptions or risks to public health.
“As we navigate resource constraints, fiscal stewardship remains our top priority. We are committed to strengthening efficiency across all operations while ensuring that limited resources are focused on the City’s most critical needs,” said Dallas City Manager Kimberly Bizor Tolbert.
The city will continue closely monitoring revenues and expenditures and may implement additional cost containment measures if necessary. Officials say they remain committed to responsible management of public funds while maintaining delivery of essential services.
