According to a city memo written by City Manager Stephen Dunn and given to the council during a closed session meeting, preliminary numbers showed the shelter cost $713,000, which was over a projected $602,000.
However, after going through the numbers again Dunn found the actual cost to be $558,000.
The first set of numbers included depreciation costs, which does not cost the city money.
"The animal shelter did better than projected for the last fiscal year; now the question comes to mind is is that amount affordable?" Dunn said.
Animal services costs have increased by $200,000 annually since the city opened its new facility in 2010 in Memorial Park.
At twice the size of the previous shelter on 15th Street, the new shelter is able to hold more animals, keeping the euthanasia rates low, but it also costs the city more in maintenance.
Dunn said he would like to see the costs decrease to $350,000, which would be in line with the cost to run the previous shelter.
Dunn said a change in shelter policy may have to be reviewed as well as proposals from outside agencies to run the shelter.
More information will be available in a report he's preparing for a special City Council meeting on Wednesday.
Jon Knowlton, the city's animal services supervisor, said the shelter is on the chopping block as well and he's heard discussion of outsourcing or regionalizing the shelter some time.
"We're on the block too as far as outsourcing, but there are things we can do to continue cutting costs and increases revenues," he said.
He said that keeping animals longer does not have a significant impact on the budget.
"In reality that doesn't raise the cost very much," he said. "You still have employees, lights, gas and everything else."
Knowlton said shelter staff and its volunteers are working to find ways to raise funds.
"We will do everything we can to help out and to cut costs and to raise funds and so forth for the shelter because the city is in a budget crisis," he said.
"We understand that and we need to do whatever we can."
Knowlton said the shelter is taking in fewer cats and kittens due to a grant from PetSmart Charities that allows them to alter free-roaming cats.
Friends of the Upland Animal Shelter, a nonprofit made of volunteers, has been raising funds for the shelter as well.
They are currently looking for a retail space to open a thrift store. The proceeds will go to the shelter.
Reach Sandra via email, call her at 909-483-8555, or find her on Twitter @UplandNow .