Agenda packet, first session — Santa Barbara City Council, February 24, 2026 (part 1 of 2)

CITY OF SANTA BARBARA

CITY COUNCIL
Randy Rowse
Mayor
Kristen W. Sneddon
Mayor Pro Tempore
Kelly McAdoo
City Administrator
Oscar Gutierrez
Ordinance Committee Chair
John S. Doimas
City Attorney
Eric Friedman
Finance Committee Chair
Meagan Harmon
Mike Jordan
Wendy Santamaria
City Hall
735 Anacapa Street
http://www.SantaBarbaraCA.gov
FEBRUARY 24, 2026, 2:00 PM
AGENDA
IN-PERSON PUBLIC COMMENT: At the beginning of each meeting of the City Council, Finance Committee, or Ordinance Committee, any member of the public may address the City Council concerning any item not on the Council's agenda. Any person wishing to make such address should first complete and deliver a "Request to Speak" form prior to the time that public comment is taken up by the City Council. Each speaker will be given a total of 3 minutes to address the Council. Pooling of time is not allowed during general public comment. The time allotted for general public comment at the beginning of the 2:00 p.m. session is 30 minutes.

Any member of the public who did not speak during the 2:00 p.m. session but who submitted a request to do so during the 2:00 p.m. 30 minute session may do so at the end of the meeting when the additional “Public Comment (If Necessary)” is announced. The City Council, upon majority vote, may decline to hear a speaker on the grounds that the subject matter is beyond their jurisdiction.

REMOTE PUBLIC COMMENT: Members of the public wishing to speak must “raise their hand” in the Zoom platform by selecting the virtual hand icon when their item is called. The keyboard shortcut for this is Alt+Y for Windows and Option+Y for Macs. City staff will activate the speaker’s microphone when the speaker’s name is called. The speaker will then need to unmute themselves. The keyboard shortcut for this is Alt+M for Windows or Command-Shift-A for Macs.

HOW TO REMOTELY OBSERVE AND/OR SPEAK LIVE AT A MEETING
 Web: https://santabarbaraca-gov.zoom.us/j/89359334270 (Participation via Zoom)  Telephone: Dial 1-669-900-6833, Enter Webinar ID: 893 5933 4270 (press *9 to raise/lower hand; press *6 to mute/unmute)  Online Streaming: Council meetings are streamed live at www.SantaBarbaraCA.gov/CAP  TV: Each regular City Council meeting is broadcast live in English and Spanish on City TV Channel 18 and rebroadcast in English on Wednesdays and Thursdays at 7:00 p.m. and Saturdays at 8:00 a.m., and in Spanish on Sundays at 3:00 p.m.

Each televised Council meeting is closed captioned for the hearing impaired. Check the City TV program guide at www.santabarbaraca.gov/citytv for rebroadcasts of Finance and Ordinance Committee meetings.

WRITTEN PUBLIC COMMENT: Public comments may also be submitted via email to [email protected] prior to the beginning of the Council Meeting. All public comments submitted via email will be provided to City Council and will become part of the public record.
(CONTINUED ON NEXT PAGE)
ORDER OF BUSINESS: Regular meetings of the Finance Committee and the Ordinance Committee begin at 12:00 p.m. The regular City Council meeting begins at 2:00 p.m. in the Council Chambers at City Hall.

REPORTS: Copies of the reports relating to agenda items are available for review at http://www.SantaBarbaraCA.gov/CAP.In accordance with state law requirements, this agenda generally contains only a brief general description of each item of business to be transacted or discussed at the meeting. Should you wish more detailed information regarding any particular agenda item, you are encouraged to obtain a copy of the Council Agenda Report (a "CAR") online at the City's website (http://www.SantaBarbaraCA.gov/CAP). Materials related to an item on this agenda submitted to the City Council after distribution of the agenda packet are posted to the City’s website as soon as reasonably feasible.

CONSENT CALENDAR: The Consent Calendar is comprised of items that will not usually require discussion by the City Council. A Consent Calendar item is open for discussion by the City Council upon request of a Councilmember, City staff, or member of the public. Items on the Consent Calendar may be approved by a single motion. Should you wish to comment on an item listed on the Consent Agenda, after turning in your "Request to Speak" form, you should come forward to speak or raise your hand in Zoom at the time the Council considers the Consent Calendar.

SPANISH INTERPRETATION: If you need interpretation of your communications to Council from Spanish into English, please contact the City Clerk’s Office at 564-5309 or by email at [email protected]. If possible, notification of at least 48 hours will usually enable the City to make arrangements.

INTERPRETACIÓN EN ESPAÑOL: Si necesita una interpretación del español al inglés, para sus comunicaciones al Consejo, comuníquese con la Oficina del Secretario Municipal al 564-5309, o por correo electrónico a [email protected]. Si es posible, la notificación de al menos 48 horas generalmente permitirá a la Ciudad hacer los arreglos.

AMERICANS WITH DISABILITIES ACT: If you need auxiliary aids or services or staff assistance to attend or participate in this meeting, please contact the City Administrator's Office at 564-5305 or by email at [email protected]. If possible, notification at least 48 hours prior to the meeting will usually enable the City to make reasonable arrangements. For those who need accessibility accommodation in using the “raise hand” function and/or registering to participate in the Zoom session, please contact the Clerk’s office by 5:00 p.m. the day before the meeting for assistance. Additionally, a speaker may email [email protected] by 5:00 p.m. the day before a meeting, stating which item they wish to speak on. Specialized services, such as sign language interpretation or documents in Braille, may require additional lead time to arrange. 02/24/2026 Santa Barbara City Council Final Agenda Page 1 FEBRUARY 24, 2026 AGENDA
SPECIAL FINANCE COMMITTEE MEETING - 11:30 A.M. IN THE COUNCIL

CHAMBER

1. Subject: Fiscal Year 2026 Second-Quarter Review
Recommendation: That Finance Committee recommend that Council:

A. Receive a report from staff on the status of revenues and expenditures in relation to budget for the six months ended December 31, 2025; B. Accept the Fiscal Year (FY) 2026 Interim Financial Statements for the six months ended December 31, 2025;
C. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Resolution No. 25-129 to Approve Proposed Second-Quarter (Q2) Adjustments to FY2026 Revenue and Expenditure Appropriations as Detailed in the Attached Schedule of Proposed Q2 Adjustments; and
D. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Position Salary Control Resolution No. 25-138 for Authorized Positions for Fiscal Year 2026. Changes are Effective January 10, 2026.

2. Subject: Process and Considerations Related to Establishing an Enhanced Infrastructure Financing District
Recommendation: That Finance Committee:

A. Receive a report and accompanying materials regarding the establishment of an Enhanced Infrastructure Financing District (EIFD); B. Provide direction to staff on whether to proceed with (a) refining the feasibility analysis, (b) preparation of an Infrastructure Financing Plan (IFP), and/or (c) formation of a Public Financing Authority (PFA) for a proposed EIFD; and
C. If desired, recommend that the City Council authorize staff to return with a resolution of intention to establish an EIFD and initiate required statutory steps.
02/24/2026 Santa Barbara City Council Final Agenda Page 2

3. Subject: Proposed Ordinance Adjusting Tax Rates of Cannabis Businesses Recommendation: That Finance Committee:

A. Hear a presentation and receive a report regarding a proposed increase of cannabis tax rates; and
B. Recommend that Council adopt, by reading of title only, an Ordinance of the Council of the City of Santa Barbara Adjusting Tax Rates of Cannabis Businesses Pursuant to Santa Barbara Municipal Code Section 5.42.250 and Rescinding Ordinance No. 5831.
02/24/2026 Santa Barbara City Council Final Agenda Page 3 REGULAR CITY COUNCIL MEETING - 2:00 P.M.

CALL TO ORDER

PLEDGE OF ALLEGIANCE

ROLL CALL

CHANGES TO THE AGENDA

CONSENT CALENDAR

1. Subject: Ordinance to Regulate Single-Use Materials [Ordinance Adoption] Recommendation: That Council adopt, by reading of title only, an Ordinance of the Council of the City of Santa Barbara Amending Section 2.42.040, Chapter 9.160 and Chapter 9.165, and Repealing Chapter 9.150 of the Santa Barbara Municipal Code Relating to Expanded Polystyrene, Single-Use Plastics, and Solid Waste Reduction.

2. Subject: Affordability Covenant Amendment for the Village Apartments Property Located At 518–524 West Canon Perdido Street [Ordinance Introduction; Agreement]
Recommendation: That Council introduce and subsequently adopt, by reading of title only, an Ordinance of the Council of the City of Santa Barbara Approving and Authorizing the City Administrator to Execute the Second Amended Affordability Control Covenant Imposed on Real Property with Turner Lighthouse L.P. for Property Located at 518–524 West Canon Perdido Street.
02/24/2026 Santa Barbara City Council Final Agenda Page 4

3. Subject: Approval of the Fiscal Year 2025-2026 Agreement for Operation of a Countywide Library System and Appropriation of County Per Capita Funds [Resolution]
Recommendation: That Council:

A. Approve and authorize the City Administrator to execute the Fiscal Year 2025-2026 Agreement for Operation of a Countywide Library System between the County of Santa Barbara and the City of Santa Barbara for the operation of Libraries belonging to the Countywide Library System; and B. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Resolution No. 25-066, Adopting the Budget for Fiscal Year 2026, to Increase Revenue and Expenditure Appropriations by $15,221 in the Fiscal Year 2026 Library General Fund and Increase Revenue Appropriations by $16,555 in the Fiscal Year 2026 Library County Fund Budget for County Per Capita Funds from the County of Santa Barbara for the Operation of Library Services.

4. Subject: January 2026 Investment Report
Recommendation: That Council accept the January 2026 Investment Report. 02/24/2026 Santa Barbara City Council Final Agenda Page 5

5. Subject: HOME Tenant-Based Rental Assistance Grant Amendments [Agreement]
Recommendation: That Council:

A. Allocate $234,313 of existing appropriations in the federal HOME Investment Partnerships Program (HOME) Fund to New Beginnings, and approve an Amendment to Tenant-Based Rental Assistance (TBRA) Subrecipient Grant Agreement No. 28,481, to increase funding and incorporate new Policy Requirements issued by the U.S. Department of Housing and Urban Development (HUD);
B. Allocate $100,000 of existing appropriations in the federal HOME Fund to Transition House, and approve an Amendment to TBRA Subrecipient Grant Agreement No. 28,482, to increase funding and incorporate new policy requirements issued by HUD;
C. Allocate $234,313 of existing appropriations in the federal HOME Fund to the Housing Authority of the City of Santa Barbara, and approve an Amendment to TBRA Subrecipient Grant Agreement No. 28,483, to increase funding and incorporate new policy requirements issued by HUD; and
D. Authorize the Deputy City Administrator to execute such agreements, amendments, and related documents, subject to approval as to form by the City Attorney.

6. Subject: Professional Services Agreement with Kruger Bensen Ziemer Architects, Inc. for the Carrillo Gymnasium Renewal Project [Agreement] Recommendation: That Council authorize the Parks and Recreation Director to execute a Professional Services Agreement with Kruger Bensen Ziemer Architects, Inc. to provide architectural and engineering design services for the Carrillo Gymnasium Renewal Project in the amount not to exceed $267,300.

REPORT FROM THE FINANCE COMMITTEE

GENERAL PUBLIC COMMENT

PULLED CONSENT ITEMS
02/24/2026 Santa Barbara City Council Final Agenda Page 6

CITY COUNCIL ADMINISTRATIVE AND ATTORNEY REPORTS

FINANCE DEPARTMENT

7. Subject: Fiscal Year 2026 Second-Quarter Review [Resolution] Recommendation: That Council:

A. Receive a report from staff on the status of revenues and expenditures in relation to budget for the six months ended December 31, 2025; B. Accept the Fiscal Year (FY) 2026 Interim Financial Statements for the six months ended December 31, 2025;
C. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Resolution No. 25-129 to Approve Proposed Second Quarter (Q2) Adjustments to FY2026 Revenue and Expenditure Appropriations as Detailed in the Attached Schedule of Proposed Q2 Adjustments;
D. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Position Salary Control Resolution No. 25-138 for Authorized Positions for Fiscal Year 2026. Changes are Effective January 10, 2026;
E. Hear a report from staff regarding revenue generating and expenditure control options to balance the General Fund budget in FY2026 and forecast for FY2027; and
F. Hear a report from staff related to the development of the Mid-Cycle budget update for FY2027.

COUNCIL AND STAFF COMMUNICATIONS

COUNCILMEMBER COMMITTEE ASSIGNMENT REPORTS & ENGAGEMENTS

PUBLIC COMMENT (IF NECESSARY)

ADJOURNMENT

CITY OF SANTA BARBARA

FINANCE COMMITTEE MEETING

SPECIAL MEETING AGENDA
DATE: February 24, 2026 Eric Friedman, Chair
TIME: 11:30 AM Wendy Santamaria, Vice Chair
PLACE: Council Chambers Meagan Harmon
Kelly McAdoo, City Administrator John S. Doimas, City Attorney Keith DeMartini, Finance Director
IN-PERSON PUBLIC COMMENT: Any person wishing to address the Finance Committee should first complete and deliver a "Request to Speak" form prior to the time that public comment is taken up by the Committee Member. Each speaker will be given a total of 3 minutes to address the Committee. The Finance Committee, upon majority vote, may decline to hear a speaker on the grounds that the subject matter is beyond their jurisdiction.

HOW TO REMOTELY OBSERVE AND/OR SPEAK LIVE AT A MEETING:
 Web: SantaBarbaraCA-gov.Zoom.US/s/85839766181 (Participation via Zoom).  Telephone: Dial 1-669-900-6833, Enter Webinar ID: 858 3976 6181 (press *9 to raise/lower hand; press *6 to mute/unmute).  Online Streaming: Finance Committee meetings are streamed live at SantaBarbaraCA.gov/CAP.  TV: Each regular Finance Committee meeting is broadcast live in English and Spanish on City TV Channel 18.

Each televised Finance Committee meeting is closed captioned for the hearing impaired. Check the City TV program guide at SantaBarbaraCA.gov/CityTV for rebroadcasts of Finance Committee meetings.

WRITTEN PUBLIC COMMENT: Public comments may also be submitted via email to [email protected] prior to the beginning of the Finance Committee Meeting. All public comments submitted via email will be provided to the Finance Committee and will become part of the public record.

REPORTS: Copies of the reports relating to agenda items are available for review at SantaBarbaraCA.gov/CAP. In accordance with state law requirements, this agenda generally contains only a brief general description of each item of business to be transacted or discussed at the meeting. Should you wish more detailed information regarding any particular agenda item, you are encouraged to obtain a copy of the Council Agenda Report (a "CAR") online at the City's website (SantaBarbaraCA.gov/CAP). Materials related to an item on this agenda submitted to the City Council after distribution of the agenda packet are posted to the City’s website as soon as reasonably feasible.

LANGUAGE TRANSLATION AND INTERPRETATION: The City of Santa Barbara offers live Spanish translation and interpretation for City Council Meetings via the Wordly platform. Follow the directions below to access the service.  Go to: Attend.Wordly.AI/Join/QQBV-6746.
o Ensure the Session ID QQBV-6746 is displayed.
o Select “Spanish” and click on the “Attend” button.
o You can now read the captions on your device and/or listen to the translation of the City Council meeting. o Click the speaker button to hear a text-to-speech version of the translated dialogue.  If you have any questions or concerns, please contact City TV at 805-564-5311. (CONTINUED ON NEXT PAGE)
SPANISH INTERPRETATION: If you need interpretation of your communications to Council from Spanish into English, please contact the City Administrator’s Office at 564-5305 or by email at [email protected]. If possible, notification of at least 48 hours will usually enable the City to make arrangements.

INTERPRETACIÓN EN ESPAÑOL: Si necesita una interpretación del español al inglés, para sus comunicaciones al Consejo, comuníquese con la Oficina del Administrador de la Ciudad al 564-5305, o por correo electrónico a [email protected]. Si es posible, la notificación de al menos 48 horas generalmente permitirá a la Ciudad hacer los arreglos.

AMERICANS WITH DISABILITIES ACT: If you need auxiliary aids or services or staff assistance to attend or participate in this meeting, please contact the City Administrator's Office at 564-5305 or by email at [email protected] if possible, notification at least 48 hours prior to the meeting will usually enable the City to make reasonable arrangements. For those who need accessibility accommodation in using the “raise hand” function and/or registering to participate in the Zoom session, please contact the Finance Department by 5:00 p.m. the day before the meeting for assistance. Additionally, a speaker may email [email protected] by 5:00 p.m. the day before a meeting, stating which item they wish to speak on. Specialized Services, such as sign language interpretation or documents in Braille, may require additional lead time to arrange.

ITEMS FOR CONSIDERATION:

1. Subject: Fiscal Year 2026 Second-Quarter Review
Recommendation: That Finance Committee recommend that Council:

A. Receive a report from staff on the status of revenues and expenditures in relation to budget for the six months ended December 31, 2025;
B. Accept the Fiscal Year (FY) 2026 Interim Financial Statements for the six months ended December 31, 2025;
C. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Resolution No. 25-129 to Approve Proposed Second-Quarter (Q2) Adjustments to FY2026 Revenue and Expenditure Appropriations as Detailed in the Attached Schedule of Proposed Q2 Adjustments; and
D. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Position Salary Control Resolution No. 25-138 for Authorized Positions for Fiscal Year 2026. Changes are Effective January 10, 2026.

2. Subject: Process and Considerations Related to Establishing an Enhanced Infrastructure Financing District
Recommendation: That Finance Committee:

A. Receive a report and accompanying materials regarding the establishment of an Enhanced Infrastructure Financing District (EIFD);
B. Provide direction to staff on whether to proceed with (a) refining the feasibility analysis, (b) preparation of an Infrastructure Financing Plan (IFP), and/or (c) formation of a Public Financing Authority (PFA) for a proposed EIFD; and C. If desired, recommend that the City Council authorize staff to return with a resolution of intention to establish an EIFD and initiate required statutory steps.

3. Subject: Proposed Ordinance Adjusting Tax Rates of Cannabis Businesses Recommendation: That Finance Committee:

CITY OF SANTA BARBARA

FINANCE COMMITTEE AGENDA REPORT
AGENDA DATE: February 24, 2026
TO: Finance Committee
FROM: Finance Department and Human Resources Department SUBJECT: Fiscal Year 2026 Second-Quarter Review
RECOMMENDATION: That Finance Committee recommend that Council:

A. Receive a report from staff on the status of revenues and expenditures in relation to budget for the six months ended December 31, 2025;
B. Accept the Fiscal Year (FY) 2026 Interim Financial Statements for the six months ended December 31, 2025;
C. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Resolution No. 25-129 to Approve Proposed Second-Quarter (Q2) Adjustments to FY2026 Revenue and Expenditure Appropriations as Detailed in the Attached Schedule of Proposed Q2 Adjustments; and D. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Position Salary Control Resolution No. 25-138 for Authorized Positions for Fiscal Year 2026. Changes are Effective January 10, 2026.

EXECUTIVE SUMMARY:

The FY2026 interim financial statements for the six months ending December 31, 2025, are presented to the Finance Committee. The report also includes staff revenue and expenditure projections for the General Fund and Enterprise Funds. Staff is projecting an operating deficit in the General Fund of $5.9 Million, requiring additional use of reserves to balance the budget. In order to address this additional financial pressure, staff worked to develop a comprehensive set of revenue generating and expenditure reduction/control options for the Finance Committee to consider. More than 200 individual ideas were generated and evaluated to determine potential service delivery impacts and revenue generating and cost savings ranges, among others. The Finance Committee provided Agenda Item No. 1
Council Agenda Report
Fiscal Year 2026 Second-Quarter Review
February 24, 2026

Page 2 ends

their recommendations on October 21, 2025, and the City Council provided their direction on December 2, 2025.

DISCUSSION:

Each month, staff present interim financial statements (Attachment 1) showing the status of revenues and expenditures in relation to budget for City Funds. Each quarter, the interim financial statements are expanded to include a detailed narrative analysis of General Fund and Enterprise Funds (Attachment 2).

In addition to the Q2 budget analysis, staff propose recommended budget adjustments for City Council approval. These adjustments are the result of new information and/or unanticipated events that occurred since the adoption of the budget in June 2025. A listing and description of each proposed FY2026 adjustment is provided in Attachment 3.

Revenue and Expenditure Summary
The table below summarizes the General Fund revenue and expenditure budget including actuals through Q2. The total adopted revenue budget is $208.7 Million, and the total adopted expenditure budget is $210.3 Million, resulting in an operating deficit of approximately $1.6 Million. The revised budget incorporates additional expenditure from encumbrances carried forward from prior year contractual commitments, along with any City Council approved adjustments since beginning of the fiscal year. There are still several pending adjustments that will have an impact on the bottom line; however, the overall Q2 result is materially correct.

Q2 adjustments are also not represented in the tables below. Revenues from taxes are

45.0% of budget or $80.0 Million.

General Fund
FY2026
Adopted Budget
FY2026
Revised Budget
Actual
FY 2026 – Q2
FY2026
Projections
Actual % of
Revised Budget
Revenues $208,664,394 $209,299,372 $95,597,174 $207,963,810 45.7% Expenditures $210,270,441 $218,834,191 $104,870,665 $213,894,708 47.9% Surplus (Deficit) $(1,606,047) $(9,534,819) $(9,273,492) $(5,930,898) Measure C
FY2026
Adopted Budget
FY2026
Revised Budget
Actual
FY 2026 – Q2
FY2026
Projections
Actual % of
Revised Budget
Revenues $34,235,000 $34,235,000 $16,160,754 $34,235,000 47.2% Expenditures $35,119,802 $78,405,849 $13,662,082 $78,405,849 17.4% Surplus (Deficit) $(884,802) $(44,170,849) $2,498,672 $(44,170,849) The voters approved a half-cent transaction and use tax on November 5, 2024, which became effective on April 1, 2025, with the first payment to be received at Q4. Measure I tax revenue is projected to generate approximately $15.1 Million annually beginning in FY2026.

At the end of this second quarter, staff received $5.0 Million of revenue.

Council Agenda Report
Fiscal Year 2026 Second-Quarter Review
February 24, 2026

Page 3 ends

Tiers of Staff Recommendations to Address the Budget Deficit Over the last few months, staff developed a comprehensive set of revenue generating and expenditure reduction/control options for the Finance Committee to consider. More than 200 individual ideas were generated and evaluated to determine potential service delivery impacts and revenue generating and cost savings ranges, among others. Staff also categorized the ideas into the following tiers:
• Tier 1 – Can be implemented fairly quickly.
• Tier 2 – May take more time, but still worth exploring and implementing. • Tier 3 – Do not recommend at this time but to be considered in the future.

The Finance Committee provided direction to staff during the meeting on October 21, 2025, as follows:
• Highest priorities (recommending to proceed):
• Cannabis excise tax revenue generators:
• Increase cannabis excise tax up to the 20.0% voter approved limit; and • Consider additional revenue generating sales opportunities • Initiate a poll to assess the viability of possible revenue tax measures for the November 2026 ballot, including tax rates increases for Real Property Transfer Tax, Transient Occupancy Tax (TOT), Utility Users Tax, and a Parcel Tax; and • Analyze recreational vehicle camping at the Waterfront parking lots. • Lowest priorities (not recommending to proceed):
• Library closures or reduced hours of operation;
• Allow short-term rentals throughout the City which would generate additional TOT revenue; and
• Increase parking fees.

Below the Committee will find an update regarding the budgetary savings impacts staff are projecting for FY2026 and FY2027 and explanations below the table.

Page 4 ends

Impacts in FY2026 include items such as:
 Transferring positions to Enterprise Funds
 Minor fee adjustments
 Library reorganization
 Increase parking citation revenues
 Hold positions vacant
 Clean Community taking on General Fund expenses
Impacts in FY2027 include items such as:
 Transferring positions to Enterprise Funds
 Minor fee adjustments
 Library reorganization
 Increase parking citation revenues
 Hold positions vacant
 Clean Community taking on General Fund expenses
Position Changes Summary
Human Resources seeks Council approval for the following adjustments to the Position Salary Control Resolution No. 25-138, effective January 10, 2026, as detailed in Attachment 4.

AIRPORT DEPARTMENT: Pursuant to the 2026-2027 SEIU Airport, Harbor Patrol Officers’ and Treatment Plants’ MOU we will incorporate the Airport Security Aide (New Job Class 1968) classification into the bargaining unit. Employees in this classification shall be eligible for a five percent (5.0%) cost-of-living adjustment effective January 10, 2026. The cost for FY2026 is $10,082.

CITY ATTORNEY DEPARTMENT: The City Attorney Department requests the creation of a Business Manager (Job Class 0276) classification in the unrepresented managers’ bargaining unit. The subject position will have access to a broad variety of sensitive information, including information which will be used to formulate the City’s position during labor relations activities. As such, it would be a potential conflict of interest for this position to be represented.

FIRE DEPARTMENT: The Fire Department requests the creation of an Emergency Medical Services Manager (Job Class 0353) classification. Following a survey of similarly situated positions in other jurisdictions, the salary range will be established at $137,834 to $167,477, to ensure a competitive rate to recruit qualified candidates. Emergency Medical Services (EMS) represent the largest and most complex service delivery component of the Fire Department, accounting for the majority of emergency calls, patient contacts, regulatory oversight, and operational risk. The creation of an Emergency Medical Services Manager classification is needed to ensure consistent clinical oversight, Council Agenda Report
Fiscal Year 2026 Second-Quarter Review
February 24, 2026

Page 5 ends

regulatory compliance, fiscal accountability, and continuous quality improvement across the Department’s EMS system. This position will be funded with existing salary savings within the Department.

SUSTAINABILITY & RESILIENCE DEPARTMENT: Reclassification of a 1.0 FTE Environmental Services Supervisor (Job Class 4017) to the newly created classification of Community Engagement Manager (Job Class 0354). The position oversees the Community Engagement Division in the Sustainability & Resilience Department. The division is responsible for both the department’s outreach efforts and code enforcement program. Based on the duties and responsibilities of the position, this position should be a manager-level classification. This reclassification will properly classify the position. The cost to reclassify this position for FY2026 is $2,268. This position is effective March 7, 2026.

Reclassification of a 1.0 FTE Project Planner (Job Class 1507) to the newly created classification of Sustainability Analyst II (Job Class 1616). The position takes the lead on various projects and programs within the Sustainability & Resilience Department, including the City’s permeable paver program, stormwater treatment infrastructure projects, and creek restoration projects. The Sustainability & Resilience Department has lacked a classification series that fully captures the work of department staff. The department would like to create a Sustainability Analyst series with three levels to align with the work being done by department staff, including the studied project planner position. The cost to reclassify this position for FY2026 is $2,278. This position is effective March 7, 2026.

Implement Salary Adjustments Due to Compaction for Certain Positions in the Santa Barbara Supervisor’s Unit: Pursuant to the 2022-2026 Supervisor’s Association Memorandum of Understanding (MOU), the City agreed to review Supervisory Classification salaries to ensure a minimum fifteen percent (15.0%) differential above the highest paid subordinate classification. The following salary adjustments are needed to ensure the City is in compliance with the MOU and avoid compaction between a supervisor and the subordinate classification.

The salary adjustments will be applied retroactively on the dates listed in the table below.

The budget impact for these salary adjustments in Fiscal Year 2026 is approximately $84,577.

Council Agenda Report
Fiscal Year 2026 Second-Quarter Review
February 24, 2026

Page 6 ends

Job
Class Classification Title
New Minimum
Biweekly
New Maximum
Biweekly Effective
Salary
Increase
4004 AIRPORT OPERATIONS SUPERVISOR $3,917.93 $4,762.28 1/10/2026 3.98% 4023 CREEKS SUPERVISOR $5,335.80 $6,485.70 9/20/2025 5.15% 4024 HARBOR PATROL SUPERVISOR $4,764.28 $5,791.03 1/10/2026 0.40% 4028 LABORATORY SUPERVISOR $5,637.43 $6,852.32 1/10/2026 3.96% 4038 SR LIBRARIAN $3,820.02 $4,643.24 9/20/2025 0.91%
4049 TREATMENT PLANT TECHNICIAN SUPERVISOR $5,637.43 $6,852.32 1/10/2026 3.96% 4050 URBAN FOREST SUPERINTENDENT $4,370.82 $5,312.74 9/20/2025 3.36% 4052 WW COLLECTION SYSTEM SUPERVISOR $5,051.01 $6,139.54 1/10/2026 3.98% 4053 WW COLLECTION SYSTEM SUPERINTENDENT $6,482.87 $7,879.99 1/10/2026 3.96% 4054 WW TREATMENT SUPERINTENDENT $6,482.87 $7,879.99 1/10/2026 3.96% 4055 WW TREATMENT SUPERVISOR $5,637.43 $6,852.32 1/10/2026 3.96% 4057 WATER TREATMENT SUPERINTENDENT $6,482.87 $7,879.99 1/10/2026 3.96% 4058 WATER TREATMENT SUPERVISOR $5,637.43 $6,852.32 1/10/2026 3.96% 4059 WATER DISTRIBUTION SUPERINTENDENT $6,482.87 $7,879.99 1/10/2026 3.96% 4060 WATER DISTRIBUTION SUPERVISOR $5,637.43 $6,852.32 1/10/2026 3.96% 4069 WATER QUALITY SUPERINTENDENT $6,482.87 $7,879.99 1/10/2026 3.96% 4071 WATER SERVICES SUPERVISOR $4,902.20 $5,958.68 1/10/2026 3.19% 4072 WATER SERVICE SUPERINTENDENT $6,482.87 $7,879.99 1/10/2026 3.96% 4075 SUPERVISING PARK RANGER $3,831.14 $4,656.76 1/10/2026 3.98% Implement Salary Adjustments Due to Compaction for Certain Positions in the AFSCME, Executive Management, and Unrepresented Manager Unit: Pursuant to the 2024-2026 American Federation of State, County, and Municipal Employees Memorandum of Understanding (MOU), the City agreed to review Manager Classification salaries to ensure a minimum fifteen percent (15.0%) differential above the highest paid subordinate classification. The following salary adjustments are needed to ensure the City is in compliance with the MOU and avoid compaction between a Manager and the subordinate classification.

The salary adjustments will be applied retroactively on the dates listed in the table below.

The budget impact for these salary adjustments in Fiscal Year 2026 is approximately $117,221.

Council Agenda Report
Fiscal Year 2026 Second-Quarter Review
February 24, 2026

Page 7 ends

Job
Class Classification Title
New Minimum
Biweekly
New Maximum
Biweekly Effective
Salary
Increase
207 BUDGET MANAGER $5,335.69 $6,485.55 7/26/2025 1.33%
305 CHIEF BUILDING OFFICIAL $6,456.74 $7,848.25 7/26/2025 0.41% 312 CREEKS RESTORATION CLEAN WATER MGR $6,136.04 $7,458.39 7/26/2025 11.07% 317 ENERGY AND CLIMATE PROGRAM MANAGER $5,335.70 $6,485.57 7/26/2025 1.38% 319 FACILITIES MANAGER $5,475.90 $6,655.98 7/26/2025 1.09% 325 INFORMATION TECHNOLOGY MANAGER $6,377.82 $7,752.30 7/26/2025 2.37% 2100 POLICE CHIEF $11,306.75 $13,743.46 3/7/2026 11.03% 336 PRINCIPAL PROJECT MANAGER $7,171.38 $8,716.89 7/26/2025 - 1/9/2026 3.36% 336 PRINCIPAL PROJECT MANAGER $7,455.37 $9,062.08 1/10/2026 3.96% 346 WATER SERVICES MANAGER $7,171.32 $8,716.78 7/26/2025 - 1/9/2026 4.88% 346 WATER SERVICES MANAGER $7,455.30 $9,061.97 1/10/2026 3.96% 347 WATER SYSTEM MANAGER $7,171.32 $8,716.78 7/26/2025 - 1/9/2026 4.88% 347 WATER SYSTEM MANAGER $7,455.30 $9,061.97 1/10/2026 3.96% 350 WASTEWATER SYSTEM MANAGER $7,171.32 $8,716.78 7/26/2025 - 1/9/2026 4.88% 350 WASTEWATER SYSTEM MANAGER $7,455.30 $9,061.97 1/10/2026 3.96% BUDGET/FINANCIAL IMPACT:

There is no direct budgetary or financial impact by accepting the interim financial statement for Q2 FY2026. The Q2 budget adjustments, as proposed, will change revenue and expenditure appropriations in the General Fund and other funds as itemized in Attachment 3. These budget adjustments have no significant budget impacts. All proposed position changes are projected to be funded through existing appropriations in various departments and funds. No additional expenditure appropriation is required at this time to fund those position changes.

The adopted General Fund budget for FY2026 and FY2027 calls for the use of reserves of $1.6 Million and $5.9 Million, respectively, to balance the budget. The General Fund has previously and is projected to continue to have structural operating deficits as ongoing revenue growth is not adequate to fund the ongoing expenditure growth of existing operations. Staff’s updated projections as of this Q2 report calls for the use of reserves of $5.9 Million in FY2026 and $10.9 Million in FY2027.

Since FY2026 began on July 1, 2025, the City negotiated with many collective bargaining units, including the Police Officers Association (POA), Fire Association (FA), Police Managers Association (PMA) and Fire Managers Association (FMA), all of which are entirely funded by the General Fund. The salary increases assumptions built into the FY2026 and FY2027 budget were 5.0% and 4.0%, respectively. The cost of all recent public safety agreements exceeds the assumptions in the FY2026 and FY2027 budget, Council Agenda Report
Fiscal Year 2026 Second-Quarter Review
February 24, 2026

Page 8 ends

which will result in increased deficits. In preparation for the Q1 FY2026 report, staff will incorporate these additional costs into the FY2026 projection.

Without any additional revenue or expenditure reductions in the General Fund, the FY2026 and FY2027 deficits will be larger thus requiring additional reserves to be used to balance the budget. If no budget changes are made, all General Fund contingency reserves will be depleted by the end of FY2026, and all General Fund disaster reserves will be depleted by the middle of FY2028.

SUSTAINABILITY IMPACT:

Budget and financial reports can be accessed by the public on the City’s Budget and Reporting webpage at SantaBarbaraCA.gov/Budget-Reports. Reports are no longer printed, saving paper and toner.

The following attachments are included in the Council Agenda Packet for February 24, 2026, as part of Item 7.

ATTACHMENTS: 1. Summary by Fund Statement of Revenues and Expenditures for the Six Months Ended December 31, 2025

2. Interim Financial Statements for the Six Months Ended December 31, 2025 (Narrative Analysis)

3. Schedule of Proposed Second-Quarter Adjustments

4. Position Salary Control Revised, Effective January 10, 2026 PREPARED BY: Nathalie Lecolley, Controller
SUBMITTED BY: Keith DeMartini, Finance Director
APPROVED BY: Kelly McAdoo, City Administrator

CITY OF SANTA BARBARA

FINANCE COMMITTEE AGENDA REPORT
AGENDA DATE: February 24, 2026
TO: Finance Committee
FROM: Finance Department
SUBJECT: Process and Considerations Related to Establishing an Enhanced Infrastructure Financing District
RECOMMENDATION: That Finance Committee:

A. Receive a report and accompanying materials regarding the establishment of an Enhanced Infrastructure Financing District (EIFD);
B. Provide direction to staff on whether to proceed with (a) refining the feasibility analysis, (b) preparation of an Infrastructure Financing Plan (IFP), and/or (c) formation of a Public Financing Authority (PFA) for a proposed EIFD; and C. If desired, recommend that the City Council authorize staff to return with a resolution of intention to establish an EIFD and initiate required statutory steps.

EXECUTIVE SUMMARY:

This staff report provides an overview of the purpose and mechanics of an Enhanced Infrastructure Financing District (EIFD), a tax increment financing tool authorized under California law. EIFDs allow cities, counties, and certain special districts to finance public infrastructure and community facilities through the allocation of incremental property tax revenue growth (tax increment) within an established property boundary. Unlike former redevelopment agencies, property tax revenues generated inside the EIFD boundary must exclude the portion allocated to any educational district and require approval from any participating public agency having tax revenues diverted to the EIFD.

This staff report outlines the legal framework, potential benefits, limitations, governance structure, financing mechanisms, and procedural steps required to establish an EIFD.

Finance Committee direction is requested on whether to proceed with further analysis and initial steps for potential formation of an EIFD.

Agenda Item No. 2
Finance Committee Agenda Report
Process and Considerations Related to Establishing an Enhanced Infrastructure Financing District
February 24, 2026

Page 2 ends

DISCUSSION:

Background
An EIFD is a public financing mechanism established under California Government Code Sections 53398.50–53398.88. Revenues and financing proceeds from an EIFD can be broadly used for infrastructure projects, provided those projects have a useful life of 15 or more years, have community-wide significance, and provide significant benefits to the EIFD or surrounding community. Accordingly, EIFDs are used as a financing tool for a wide range of public capital facilities, including but not limited to transportation improvements, water and wastewater facilities, flood control, parks, libraries, brownfield remediation, affordable housing (limited), and other community-serving infrastructure.

Legal Authority
Key statutory elements include:
 Negotiation of agreements with affected taxing entities regarding tax increment allocation;
 Adoption of a Resolution of Intention;
 Preparation and adoption of the Infrastructure Financing Plan (IFP);  Formation of the Public Financing Authority (PFA); and  Public hearings and protest procedures.

Governance Structure
An EIFD is governed by a PFA, which typically consists of members of the legislative body of the initiating city and members of the public residing within the EIFD boundary.

The PFA is responsible for adopting the IFP, authorizing debt issuance, and overseeing implementation of EIFD-funded projects.

Financing Mechanism
Once an EIFD is formed, the base-year assessed value of taxable property within the EIFD is established. Future growth in assessed value within the EIFD generates incremental property tax revenue, subject to tax sharing agreements with participating taxing entities. EIFDs may finance improvements on a pay-as-you-go basis or through the issuance of bonds secured by future tax increment, subject to statutory requirements.

Potential Benefits to the City
EIFDs provides a long-term funding source for critical infrastructure and allow the City to finance infrastructure without using a General Fund pledge. Accordingly, EIFD financing can leverage future tax revenue growth to accelerate near-term infrastructure projects.

Participation from other taxing entities increases EIFD tax revenues that can be leveraged for capital projects. In this way, an EIFD supported by multiple taxing agencies can further accelerate the timing of infrastructure projects.

Formation of an EIFD and issuance of tax increment secured debt creates a legally binding use of those EIFD revenues. So long as debt is outstanding, the PFA and Finance Committee Agenda Report
Process and Considerations Related to Establishing an Enhanced Infrastructure Financing District
February 24, 2026

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participating taxing entities would have limited ability to re-direct or re-allocate the tax increment of the EIFD.

EIFDs have flexible boundaries and can be tailored to specific corridors, districts, or opportunity areas. EIFD boundaries do not need to be contiguous.

Limitations and Considerations
EIFDs do not create additional revenues (i.e., not a new tax). EIFDs re-allocate future growth in property tax revenues away from the participating agencies’ general funds to the EIFD. Additionally, EIFDs require sufficient assessed value growth to be financially viable, and timing of that assessed value growth is critical to the ability to issue any bonds to fund capital projects. EIFD-secured financing for capital projects often occurs several years after EIFD formation, though actual timing depends on the pace of redevelopment and timing of increasing assessed value within the EIFD. The key determining factor is the timing of when there is sufficient tax increment from the EIFD to support debt service payments on the financing.

EIFD formation is dependent on voluntary participation by other taxing entities, primarily the County. While the City can form an EIFD on its own, participation from other taxing entities helps to increase the leverage available through an EIFD.

Finally, EIFDs have administrative and legal costs associated with formation and ongoing compliance. In addition, EIFDs represent a long-term commitment of incremental revenues as security for debt. Bond investors also recognize the economic risk inherent in purchasing bonds secured only by incremental taxes and require bond interest rates higher than typical City General Fund financing interest rates.

Preliminary Considerations for the City
Staff have identified the following high-level considerations should the City wish to proceed:
 Identification of potential EIFD boundaries;
 Inventory of infrastructure needs that could be financed through an EIFD;  Preliminary fiscal feasibility analysis of projected tax increment;  Outreach to the County and other affected taxing entities; and  Verify consistency with the City’s General Plan, Capital Improvement Program, and economic development goals.

Financial and budgetary review with the City Council as tax increment dollars would not be available for some currently funded General Fund essential services and functions (i.e., growth in assessed value and corresponding higher property taxes from properties in the EIFD boundaries would go to the EIFD, not the City’s General Fund) affecting the long-term financial projections.

Finance Committee Agenda Report
Process and Considerations Related to Establishing an Enhanced Infrastructure Financing District
February 24, 2026

Page 4 ends

Staff will present a potential list of developments to serve as the basis for an EIFD.

Continued review and refinement of that list is necessary if the City wishes to proceed with the formation process.

Alternatives
There are some alternative strategies and tools that the City could use to address infrastructure needs. Some of those alternatives and tools are summarized below:
 Alternative 1: The City does not form an EIFD, but rather establishes a policy whereby assessed value growth and tax revenue in pre-established locations or boundaries in the City is set aside and used for funding infrastructure projects on a pay-as-you-go (pay-go) basis. This alternative would save the City bond financing costs present in both an EIFD and a General Fund financing scenario.

However, under a pay-go approach to funding infrastructure, capital projects may be delayed until sufficient revenues are collected.
 Alternative 2: The City could issue General Fund bonds to fund infrastructure projects. Under this alternative, the City would structure the financing as a real property lease that would require the pledge of a City asset, or assets, as security for the debt. Because this debt is secured by the General Fund and not dependent on future development, there is greater flexibility with respect to timing of when the City issues the debt and the City can use this approach to “jump start” projects in the next five years. Additionally, under this alternative, because the debt is secured by the General Fund, the City is responsible for paying that debt service even if property taxes grow at a significantly lower rate than projected in the analysis.

Measure C sales tax revenues could be a potential funding source for future debt issuance. Future budget approvals would include the annual debt payments which should align with the increased property tax revenues (or a portion of the growth).

Public Outreach
If directed to proceed, staff would develop a public outreach strategy, including informational materials for stakeholder meetings and public hearings, as required by law, and best practices for transparency.

Next Steps
If the City Council wishes to proceed, staff would return with:
 A proposed EIFD boundary map;
 A detailed Infrastructure Financing Plan outline;
 A draft Resolution of Intention; and
 A proposed schedule for statutory hearings and approvals.

BUDGET/FINANCIAL INFORMATION:

There is no immediate fiscal impact associated with receiving this report. Should the City elect to proceed with EIFD formation, future costs may include consulting services (legal, Finance Committee Agenda Report
Process and Considerations Related to Establishing an Enhanced Infrastructure Financing District
February 24, 2026

Page 5 ends

financial, and economic), staff time, and administrative expenses. These costs would be evaluated and presented for Council consideration prior to any contractual commitments.

If established, an EIFD would redirect the incremental increase of those property tax dollars from currently funded General Fund essential services and functions to other functions noted above. In summary, forming an EIFD will impact the annual growth rate of future General Fund property tax revenues.

ENVIRONMENTAL REVIEW
Actions at this stage are informational and do not constitute a project under the California Environmental Quality Act (CEQA). Future actions related to EIFD formation or specific infrastructure projects would undergo appropriate CEQA review.

ATTACHMENTS: 1. Overview of the EIFD Formation Process and Timeline

2. Enhanced Infrastructure Financing District Analysis and Findings

PREPARED AND
SUBMITTED BY: Keith DeMartini, Finance Director
APPROVED BY: Kelly McAdoo, City Administrator
Overview of EIFD
Formation Process
Step 1
Form Team and Evaluate EIFD Feasibility Step 2
Finding of Completion by DOF
Step 3
Conduct Outreach
• Identify District Members
• Define Projects and Project Area
Step 4
City (and County) Actions
• Elected officials, Other Taxing Entities (as
applicable), Affected property owners
• Final determination of EIFD Boundaries,
targeted projects, PFA Board composition
Step 5
Draft Infrastructure Financing Plan (IFP)
Step 6
Informational Meeting: PFA Presents IFP
Step 7
City (And County) Actions
Step 8
First Hearing on IFP
Step 9
Second Hearing on IFP (Tabulate Protests)
• Required if City or County had a
redevelopment agency
• Payment Review, Resolution of Disputes, No
Litigation
• Adopt resolution of Intention (ROI), specifying
boundary/map, facility types, goals, tax
increment allocations
• Formally establish the Public Financing
Authority (PFA) • Distribute IFP to affected taxing entities and property owners
• Start CEQA Process
• Public meeting to present draft IFP to the Public
• 10 days mailed notice or 40 days consolidated
notice • Second hearing for IFP
• Approve IFP via resolutions by both City
Council and governing body of other taxing
contributing tax increment
• PFA holds public hearing to hear additional
comments and take action to either modify or
reject the IFP
• Must occur at least 30 days after Step 6
(Presenting IFP to Public) • PFA holds second public hearing, count protests, and takes action to either terminate
or adopt IFP and form the EIFD
• At least 30 days after Step 8 (First Public
Hearing)
Key EIFD Features
• EIFD term can be up to 45 years after first bond
issuance (term can be amended post-formation)
• Does not need to be contiguous
• Tax increment revenues begin first year after EIFD
formation
• First bonds issued after sufficient tax increment has built up (can be several years after formation and after projects are completed)
• Eligible projects: Public infrastructure with useful life 15+ years & communitywide significance (including
affordable housing)
• Eligible project components: purchase, construction,
expansion, improvement, seismic, rehabilitation,
maintenance
• Education districts may not consent to participating in an EIFD
Steps 4-9 take approximately
6 to 8 Months
ATTACHMENT 1

CITY OF SANTA BARBARA

ENHANCED INFRASTRUCTURE FINANCING DISTRICT

ANALYSIS AND FINDINGS
FEBRUARY 24, 2026
ATTACHMENT 2
2 Background
 City engaged NHA Advisors (“NHA”) to assist with evaluating potential benefits of implementing an Enhanced Infrastructure Financing District (“EIFD”) to support redevelopment of specific properties
 NHA analyzed multiple EIFD scenarios based on list of potential projects including:
 City tax contribution only
 City + 50% County tax contribution
 City + full County tax contribution
 NHA also analyzed non-EIFD funding scenarios to provide context and alternative options
3 EIFD Overview
 EIFD sets “base year” for identified
parcels
 Base Year AV does not change during EIFD
term, AV tax revenues continue to flow to
the General Fund at “frozen” base year
 Redevelopment creates additional AV,
creating incremental EIFD revenues
 Tax Increment passed through to taxing
agencies except for City (and potentially
County) which stays in EIFD
 EIFD funds can be used for pay-go
infrastructure projects or bond debt
service
Year 1Year 3Year 5Year 7Year 9
Year 11Year 13Year 15Year 17Year 19Year 21Year 23Year 25Year 27Year 29 Example: AV Growth After EIFD Formation
EIFD Formed
Base Year Assessed Value (Frozen)
Incremental AV Growth
Developments Completed –
First Revenues
4 Who Participates in an EIFD?
 Taxing Agency participation is voluntary
 Each participating agency can identify the
amount (%) of funding it deposits into the
EIFD
 EIFDs cannot divert tax revenues from
school districts
 Taxpayer support is needed
 If >50% of voters or landowners within the
boundary vote against the EIFD, it cannot
proceed
 EIFD does not create a new tax
 Redirects portion of existing ad valorem
property tax revenue
Cities
• Participation is typically 100% of Tax Increment
Counties
• Participation varies, but often capped at 50%
• Some counties have pre-approved policies related to EIFD participation
School Districts
• Participation not allowed
Fire Districts
• Participation is uncommon
Other Independent Districts
• Participation is uncommon
Common EIFD Participation Amounts
5 What Can an EIFD Fund?
 Broad flexibility to fund infrastructure projects
 Useful live >15+ years
 Community-wide significance
 Significant benefits to EIFD or surrounding community  Eligible project components include:
 Purchase
 Construction
 Expansion
 Improvement
 Seismic improvements
 Rehabilitation
 Maintenance
Affordable housing
Water projects
Sewer projects
Roads and streets
Solid waste facilities
Parks
Open space
Recreational facilities
6 EIFD Formation Timeline and Process
Step 1
• Form team and evaluate feasibility
Step 2
• Finding of completion by DOF
Step 3
• Conduct outreach
Step 4
• City (and County) Actions
Step 5
• Draft Infrastructure Financing Plan
(IFP)
Step 6
• Informational meeting: Present IFP
Step 7
• City (and County) Actions : Second
presentation of IFP; IFP approval
Step 8
• First public hearing on IFP
Step 9
• Second Hearing on IFP, Tabulate
Protests, Form EIFD
Steps 4-9 take approximately 6-8 Months
7 Summary of Potential EIFD Boundaries
EIFD modeling assumes $1.13 billion of assessed value increase through FYE 2030; see Appendix for complete list of developments. 3805 State St
(formerly Macy’s):
660 Multifamily
units
3845 State St
(formerly Sears):
443 Multifamily
units
101 Garden
Street: 250-
room hotel
817 State St
(formerly
Nordstrom): 112
Multifamily units
418 N. Milpas:
90 Multifamily units
633 E. Cabrillo: 80-
room hotel
8 Scenario 1A: EIFD Debt Financing (City Participation Only)  EIFD Formation by June 2028
 EIFD Revenues Generated after
Development Completed
 Bonding Capacity available after a
significant number of projects are
completed
 Revenues Exceed Bond Debt Service 2x
 Tax Increment Bonds sold in FY 2032-33
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
2025-262027-282029-302031-322033-342035-362037-382039-402041-422043-442045-462047-482049-502051-522053-542055-562057-582059-602061-622063-642065-662067-682069-70 Scenario 1A: Estimated EIFD Revenues and Debt Service
Property Taxes from New Development Going Back to General Fund and Others EIFD Revenues
Baseline Tax Increment
Estimated Debt Service Payment
Scenario 1A: City Only EIFD Participation
Project funds from Bond Issuance $30,900,000
EIFD Revenues After Paying Debt Service
(through 2035)
$15,200,000
Total EIFD Proceeds (Next 10 Years) $46,100,000
Estimated Annual Debt Service Payment $2,300,000
Debt-related assumptions are included in the Appendix
9 Scenario 1B: EIFD Debt Financing (County & City Participation)  Scenario 1A + 50% County
participation
 Single Bond Financing
Scenario 1B: City and County EIFD Participation
Project funds from Bond Issuance $52,100,000
EIFD Revenues After Paying Debt Service
(through 2035)
$25,600,000
Total EIFD Proceeds (Next 10 Years) $77,700,000
Estimated Annual Debt Service Payment $3,900,000
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
2025-262027-282029-302031-322033-342035-362037-382039-402041-422043-442045-462047-482049-502051-522053-542055-562057-582059-602061-622063-642065-662067-682069-70 Scenario 1B: Estimated EIFD Revenues and Debt Service
Property Taxes from New Development Going Back to General Fund and Others EIFD Revenues
Baseline Tax Increment
Estimated Debt Service Payment
Debt-related assumptions are included in the Appendix
10 Scenario 2: No Financing (Pay-Go Only)
 City establishes policy allocating portion
of future property tax revenue for
infrastructure and/or affordable housing
projects
 10-year Analysis
 30+ year Projection - more total
revenues than Scenario 1A, but majority
of revenues realized >10 years from
now
Scenario 2: No Financing (Pay-Go Only)
Project funds from Bond Issuance $0
Earmarked Property Tax Revenues (through
2035)
$19,300,000
Total Proceeds (Next 10 Years) $19,300,000
Estimated Annual Debt Service Payment $0
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
2025-262027-282029-302031-322033-342035-362037-382039-402041-422043-442045-462047-482049-502051-522053-542055-562057-582059-602061-622063-642065-662067-682069-70 Scenario 2: No Financing – Pay-Go Only
Property Taxes from New Development
Baseline Tax Increment
Estimated Increased Property Taxes (Next 10 Yrs)
11 Scenario 3: City General Fund Financing (No EIFD)
 Scenario 2 Assumptions
 General Fund Financing
 Bonds can be issued sooner than EIFD
 30-Year Bond Repayment
 Requires real City asset as collateral
 Surplus Property Taxes (after debt service)
can support other infrastructure/affordable
housing
Scenario 3: City General Fund Financing (No EIFD)
Project funds from Bond Issuance $37,200,000
Earmarked Property Tax Revenues After
Paying Debt Service (through 2035)
$12,700,000
Total Proceeds (Next 10 Years) $49,900,000
Estimated Annual Debt Service Payment $2,200,000
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
2025-262027-282029-302031-322033-342035-362037-382039-402041-422043-442045-462047-482049-502051-522053-542055-562057-582059-602061-622063-642065-662067-682069-70 Scenario 3: City General Fund Financing (No EIFD)
Property Taxes from New Development
Baseline Tax Increment
General Fund Bonds Debt Service
Debt-related assumptions are included in the Appendix
12 Summary Comparison
Scenario 1A Scenario 1B Scenario 2 Scenario 3
Scenario Summary Form EIFD
(City Only)
Form EIFD
(City & County)
No EIFD
No Bonds, Property
Tax Set Aside
No EIFD
General Fund
Financing
Revenues & Debt Proceeds
(Through 2035) $46.1M $77.7M $19.3M $49.9M
Total Revenues & Debt Proceeds
(Through 2060) $158M $267M $184M $158M
Estimated Annual Debt Payment $2.3 M $3.9M $0 $2.2 M
Notes & Observations • Simpler EIFD
formation process
vs Scenario 1B
(City Council is
only governing
board)
• County
participation: +/–
25% shift from
50% assumption
impacts 10-yr
revenues +/-
$18M
• Property tax
revenue policy can
be reversed by
future Council
decision
• Slow to get started
(most revenues
occur >10 yrs)
• General Fund
obligation to pay
regardless of
future property
tax growth
13 Next Steps
Based on direction from Finance Committee, City staff will proceed with next steps:
• If Scenarios 1A or 1B
• Next step is Finding of Completion by California DOF and starting discussions with the County regarding participation
• If Scenario 2
• Next step is to discuss internal City process of establishing and tracking Annually Appropriated Property Taxes & bring policy to City Council
• If Scenario 3
• Next step is to discuss timing of issuance and potential assets the City can pledge as collateral

APPENDICES
15 Key Data Sources and Assumptions
 NHA worked off a city-wide parcel
dataset and a list of developments
provided by City staff
 City staff validated timelines and
development types for the projects on
the list
 Property tax growth assumption based
on historical growth rates in the City
 Construction cost escalation assumption
based on 15-year average construction
cost index growth
 Development cost assumptions based on
research done by City staff on recent
development, with input from UCSB
faculty
Key Assumptions
Modeling Assumptions
Property Tax Growth Rate (Applies to Base Year AV and New AV After Development) 4.0% Construction Cost Escalation (Applies only to Escalating Development Costs) 4.4% City Share of Property Taxes 12.00%
City Share of VLF Revenue (Per $1,000 new AV) $0.40
County Share of Property Taxes 22.02%
Termination of EIFD (Fiscal Year) 2062-63
Development Cost Assumptions
Hotel Rooms $500,000
Single Family $1,800,000
Condos $750,000
Multi Family $700,000
Retail $300
Commercial Office $300
Commercial Warehouse $200
Commercial Storage $160
N/A $0
16 Bond Financing Assumptions
Security Tax Increment
Only
Discount Rate (Cost of Debt) 5.0%
Financing Term (Years) 30
Target Debt Service Coverage 200%
Issuance Costs 4% of Par
Issuance Year 2032-33
Final Maturity 2062-63
Debt Service Escalation? No
EIFD Tax Increment Bond Financing Assumptions
Security General Fund
Pledge
Discount Rate (Cost of Debt)* 4.5%
Financing Term (Years) 30
Target Debt Service Coverage** 150%
Issuance Costs 4% of Par
Issuance Year*** 2032-33
Final Maturity*** 2062-63
Debt Service Escalation? No
General Fund Financing Assumptions
*Santa Barbara’s General Fund credit rating is “AA” currently **Debt Service coverage is not directly applicable to a General Fund financing, but since this metric serves as the sizing constraint, we have included it here to compare vs the EIFD scenario. Since the General Fund is the backstop securing the financing, bond investors would generally accept lower coverage than an tax increment secured EIFD financing. ***A general Fund financing could be issued earlier than an EIFD financing; we are keeping the issuance years and maturity constant here to aid comparison 17 Summary of Development Assumptions in EIFD Modeling
Potential Parcels for EIFD Project Name APN
New Dev:

Number of
Units Type of Unit
New
Development:

Non-Residential
Square Foot Non-Residential Type
Completion
Year
3805 State Street
Neighborhood of State & Hope
(Macy's) 051-010-013 680 Multi Family N/A 2028-29
101 Garden Street Garden St. Hotel 017-630-018 250 Hotel Rooms N/A 2028-29 301 E. Yanonali 017-630-005 0 N/A 40,000 Commercial Storage 2028-29 633 E Cabrillo Hilton 017-680-013 80 Hotel Rooms N/A 2028-29 518 N Milpas 031-241-041 23 Condos N/A 2028-29
3845 State Former Sears 051-010-008 443 Multi Family N/A 2029-30 335 S Milpas St Tri-County Produce Market 017-285-003 53 Multi Family 10,000 Retail 2029-30 102 W De La Guerra 037-042-038 44 Multi Family 75,000 Commercial Storage 2027-28 35 Anacapa St. 033-112-002 14 Hotel Rooms 12,000 Retail 2028-29 320 W Carrillo St 039-262-033 35 Multi Family N/A 2028-29 1922 De La Vina 025-363-018 39 Multi Family N/A 2028-29 1529 State 027-231-022 27 Multi Family 4,500 Retail 2028-29 418 N. Milpas 031-311-033 90 Multi Family 1,150 Retail 2027-28 2415 De la Vina 025-061-016 44 Multi Family N/A 2027-28 817 State St
Nordstrom - Retail to residential
conversion 037-400-001 112 Multi Family N/A 2028-29
630 Chapala Closed VW dealership 037-131-024 39 Multi Family 14,000 Retail 2027-28

CITY OF SANTA BARBARA

FINANCE COMMITTEE AGENDA REPORT
AGENDA DATE: February 24, 2026
TO: Finance Committee
FROM: Finance Department
SUBJECT: Proposed Ordinance Adjusting Tax Rates of Cannabis Businesses RECOMMENDATION: That Finance Committee:

EXECUTIVE SUMMARY:

The proposed Ordinance aims to increase tax rates for cannabis businesses within the City of Santa Barbara to generate additional revenue for the General Fund. This change comes in response to directives from the Finance Committee and City Council in 2025, which aimed to explore tax rate increases as a means to bolster the General Fund amidst growing operating budget deficits. Following a comprehensive review of economic and industry data, staff recommends raising the tax rate for storefront retail and retail by delivery only businesses from 6.0% to 8.0%, effective July 1, 2026. This proposed increase seeks to balance the City's fiscal needs with the sustainability of the cannabis industry.

DISCUSSION:

On November 8, 2016, City of Santa Barbara voters approved a general tax of up to

20.0% on the gross receipts of both medical and non-medical cannabis businesses.

The City adopted an ordinance, codified in Chapter 9.44 of the Municipal Code, allowing for up to three cannabis dispensaries and the continuation of two legal non-conforming Agenda Item No. 3
Finance Committee Agenda Report
Proposed Ordinance Adjusting Tax Rates of Cannabis Businesses February 24, 2026

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medical cannabis dispensaries from a prior ordinance that has since been repealed.

Additionally, the City’s cannabis ordinance also regulates retail by delivery only, manufacturing, distribution, testing, and indoor cultivation of cannabis.

On January 23, 2018, in light of a greater understanding of the industry, and the tax structure included within the Adult Use of Marijuana Act (AUMA), Council approved initial tax rates lower than the voter-approved maximum of 20.0% so as to not overburden the industry and avoid driving businesses to other communities with lower tax rates. The City can adjust these rates at any time in the future by Ordinance.

In late 2025, the Finance Committee, along with the City Council, directed staff to explore the possibility of increasing the cannabis tax rate. This measure aims to generate additional revenue for the General Fund to address the growing operating budget deficit.

Staff reviewed the rates along with economic and industry data and are proposing a rate increase for storefront retail and retail by delivery only businesses only from 6.0% to 8.0%, effective July 1, 2026, as shown below.

Business Category Current Rate Proposed Rate
Storefront Retail 6.0% 8.0%
Retail by delivery only 6.0% 8.0%
Manufacturing 4.0% 4.0%
Distribution 4.0% 4.0%
Testing 4.0% 4.0%
Indoor Cultivation 2.0% 2.0%
State of California Excise Tax
In November 2016, Proposition 64 was approved by California voters. Proposition 64, known as the AUMA, allows for the sale of recreational marijuana, and imposes state taxes on the sale and cultivation of recreational marijuana, beginning on January 2, 2018.

The state taxes include a 15.0% excise tax on gross receipts from the sale of marijuana or any product derived therefrom as well as a cultivation tax of $9.25 per ounce of dried flower or $2.75 per ounce of dried leaf.

To support the long-term viability of the legal cannabis market, California stabilized the state excise tax at 15.0% through June 30, 2028. This rate reflects a recent legislative "rollback" via Assembly Bill 564, which was signed in September 2025 to reverse an automatic tax increase that had briefly pushed the rate to 19.0%. By returning the tax to

15.0% effective October 1, 2025, the State provided immediate price relief to consumers and helped licensed operators remain competitive with the lower-priced illicit market. This three-year stabilization period allows state regulators to monitor revenue impacts. A statelevel increase of up to 19.0% remains possible starting in the 2028-2029 fiscal year.

Finance Committee Agenda Report
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Total Tax Paid by Consumer
Consumers of cannabis products pay the City’s local cannabis tax (6.0%), the City’s sales tax (9.25%), and the state excise tax (15.0%). The state has compounding rules of how the taxes are calculated, an example is as follows:

Under the City of Santa Barbara’s current 6.0% local cannabis business tax, a $100.00 product first incurs a $6.00 local levy, creating a $106.00 subtotal that serves as the basis for the 15.0% state excise tax; this adds $15.90 to the price, after which the City’s 9.25% sales tax is applied to the cumulative $121.90 amount. The result is an additional $11.28 in sales tax for a final consumer cost of $133.18, representing an effective total tax rate of approximately 33.2%.

Cannabis businesses are also required to have a business tax certificate and renew annually. The business tax is codified in Santa Barbara Municipal Code § 5.04.390 and is calculated in tiered rates of gross receipts: $400 plus $20 per $100,000 gross receipts or fraction thereof up to $3,000,000; $800 plus $15 per $100,000 gross receipts or fraction thereof between $3,000,000 and $6,000,000 gross receipts or fraction thereof, $1,250 plus $10 per $100,000 gross receipts or fraction thereof in excess of $6,000,000 gross receipts or fraction thereof. This tax calculation results in an annual business tax ranging from $200 to $2,000 for the cannabis businesses in the City of Santa Barbara.

The following table shows the current tax rates for local jurisdictions:

Cannabis Tax Rates
Jurisdiction
Local
Cannabis
Tax
Sales
Tax
State
Excise
Tax
Approximate
Total Tax Paid
by Consumer
City of Santa Barbara 6.0% 9.25% 15.0% 33.20%
County of Santa Barbara 6.0% 7.75% 15.0% 31.40%
Goleta 5.0% 8.75% 15.0% 31.30%
Ventura 4.0% 7.75% 15.0% 28.87%
Solvang (medicinal only) 5.0% 8.75% 15.0% 31.30%
In contrast to the fixed rates established by Santa Barbara County, neighboring cities such as Goleta and Solvang utilize a tax structure that distinguishes between the current operational rate and a maximum allowable rate (the voter-approved 'cap'). While the operational rate in these jurisdictions is presently set by resolution for retail storefronts, their respective ordinances (Goleta Measure Z and Solvang Measure F) grant the City Council the authority to adjust those rates as needed, provided they do not exceed the maximum cap. This provides these neighboring councils, and the City of Santa Barbara’s Council, with the administrative flexibility to respond to regional market shifts or budget requirements via a simple resolution, whereas any change to the County’s fixed 6.0% rate would require a new vote of the people.

Finance Committee Agenda Report
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The following table shows the maximum allowable retail cannabis tax rate for local jurisdictions:

Jurisdiction Current Retail
Tax Rate
Maximum Allowable
Retail Tax
City of Santa Barbara 6.0% 20.0%
County of Santa Barbara 6.0% 6.0%
Goleta 5.0% 10.0%
Ventura 4.0% 8.0%
Solvang (medicinal only) 5.0% 10.0%
Considerations
The increase from 6.0% to 8.0% for “storefront retail” and “retail by delivery only” was determined based on staff analyzing the following considerations:
1) Local and cumulative taxes should stay in line with neighboring areas so as not to encourage consumers to drive outside of the City of Santa Barbara to purchase cannabis products. Cannabis tax consultants have economic data that indicates consumers are willing to drive 15-20 miles to pay less for cannabis products. 2) Increasing the tax above 8.0% may result in a significant enough decline in retail sales that city cannabis tax revenue would decline instead of increase. 3) No increase in tax is recommended for the manufacturing, distribution, testing, or indoor cultivation due to the reduction and/or lack of business operations in those categories.

Recent Cannabis Audit
The City contracted with HdL Companies to conduct cannabis tax audits of all six (6) cannabis businesses in the City. The purpose of the audit was to determine if sales reported to the City for the period of January 1, 2021, to December 31, 2023, were accurate and complete and to adjust taxes paid if necessary. In 2024, five (5) of the six (6) companies completed the audit; one (1) remains in progress. The findings of the audits were negligible, with some businesses having over collected the taxes, and other having small discrepancies in the revenues reported and taxes paid to the City. The net audit findings resulted in $32,000 being refunded to cannabis companies. City staff may consider completing another round of cannabis tax audits to ensure the 8.0% retail and delivery only rate is implemented correctly.

Communication Strategy & Timeline
To ensure a seamless transition of the increased cannabis rate, the City will conduct direct outreach to all impacted cannabis businesses, inviting them to an informational webinar designed to clarify new requirements and answer technical questions. Following the webinar, staff will provide an updated tax remittance form, allowing businesses a sufficient grace period to update their internal accounting systems and standard operating procedures. This proactive engagement strategy will ensure all stakeholders are fully Finance Committee Agenda Report
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prepared for compliance ahead of the effective date. The timeline of the key dates is as follows:

Finance Committee Review February 24, 2026
City Council Ordinance Adoption March 17, 2026
Updated Remittance Form Released April 27, 2026
Informational Webinar for Businesses April 30, 2026
Ordinance Takes Effect May 7, 2026
Effective Date of Rate Increase July 1, 2026
BUDGET/FINANCIAL INFORMATION:

The City of Santa Barbara is expected to generate an additional $200,000 to $400,000 annually from a cannabis tax rate increase for “storefront retail” and “retail by delivery only” from 6.0% to 8.0%.

Shown in the table below, Fiscal Year (FY) 2025 revenue amounts are based on actual collections. FY2026 projections are based on year-to-date revenues, while FY2027 assumes gross receipts remain the same as FY2026 but with an 8.0% tax rate.

The estimated tax revenue increase from FY2026 to FY2027 is $307,000, though this may vary with changes in cannabis retail sales.

Cannabis Tax Revenue
Business Category Actual FY2025 Projected FY2026 Projected FY2027 Storefront Retail $978,506 $895,000 $1,193,000
Retail by delivery only $19,492 $25,000 $34,000
Manufacturing $40,654 $27,000 $27,000
Total Revenue $1,038,652 $947,000 $1,254,000
The additional revenues generated from this tax increase would be allocated to the General Fund to fund existing essential services and contribute to reducing the budget deficit in FY2027 and beyond.

SUSTAINABILITY IMPACT:

Under California’s Proposition 64, approximately 20.0% of net cannabis excise tax revenue is allocated to the Environmental Restoration and Protection Account. These funds support the California Department of Fish and Wildlife (CDFW) in remediating "trespass grows" on public lands and restoring watersheds damaged by illegal diversions and toxic pesticides.

However, excessively high tax rates create a "sustainability penalty" by making legal, ecocompliant products significantly more expensive than those in the illicit market. When Finance Committee Agenda Report
Proposed Ordinance Adjusting Tax Rates of Cannabis Businesses February 24, 2026

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consumers are driven to unregulated sources, it inadvertently fuels cultivation operations that ignore California’s strict environmental and water-usage standards. Consequently, the City must carefully calibrate local tax rates to ensure that legal, regulated businesses remain viable and continue to uphold these essential environmental protections.

ATTACHMENTS: 1. Cannabis Tax Rate Report from Consultant HdL Companies

2. Draft Ordinance Adjusting Tax Rates of Cannabis Businesses PREPARED BY: Lyndsay Maas, Assistant Finance Director
SUBMITTED BY: Keith DeMartini, Finance Director
APPROVED BY: Kelly McAdoo, City Administrator
120 S. State College Blvd. Suite 200 | Brea, CA 92821 | 714.879.5000 | hdlcompanies.com February 5, 2026
Lyndsay Maas
Assistant Finance Director
City of Santa Barbara
735 Anacapa St
Santa Barbara, CA 93101
Re: Cannabis Tax Rates in the Santa Barbara Region
In 2016, voters in the City of Santa Barbara adopted the Santa Barbara Marijuana Control Act (Measure T-2018) as a means to raise revenue for general municipal purposes. The measure imposed a tax of up to 20% or gross receipts on both medical and non-medical cannabis businesses, with the actual rates being set by resolution of the City Council. The Act is codified as Section 5.42 of the Santa Barbara Municipal Code (SBMC).

In December of 2017 the City of Santa Barbara adopted Ordinance No. 5813 to regulate commercial cannabis businesses within the City. These requirements are codified as Section

9.44 of the SBMC. The City currently is home to 6 licensed cannabis retailers, 5 of which operate storefront locations and one which is a non-storefront delivery service.

The Santa Barbara City Council has directed staff to explore increasing the cannabis tax from the current 6% for retail to a higher percentage, with a goal of increasing tax revenues. The City has requested that HdL Companies provide a brief analysis to help the City identify prevailing cannabis retail tax rates within the Santa Barbara region and Southern California broadly to help inform this decision. The City has requested that HdL also include any other information that may be useful in considering appropriate and competitive cannabis tax rates.

To assist with this effort, the City has requested that HdL compile a selection of cannabis tax rates from other jurisdictions in the Central Coast region and other major Southern California cities. Figure 1, on the next page, lists all 28 jurisdictions in Santa Barbara, Ventura and San Luis Obispo counties, along with the cities of Los Angeles, Long Beach and San Diego and the counties of Los Angeles and San Diego.

Figure 1 shows whether each jurisdiction allows cannabis retailers and how many of each type (storefront and non-storefront delivery) they have. Green cells show that type of retail activity is allowed, while cells in red show that activity is prohibited. Some cities have regulations to allow retailers but have not yet implemented them or do not yet have any retailers that have made it through the permit process. The figure also shows the current cannabis tax rates for all jurisdictions that have a cannabis tax in place.

Only 17 of the jurisdictions in these 3 counties allow any type of cannabis retail businesses. The City of Carpinteria allows sales by delivery, only, but does not have any licensed businesses, nor does the City have a cannabis tax in place. The City of Solvang allows only medicinal cannabis sales but also does not have any licensed retailers. The County of San Luis Obispo and the City of Paso Robles also do not allow storefront retailers. Conversely, the City of Oxnard allows only storefront cannabis sales and does not allow any sales by delivery.

ATTACHMENT 1
Storefront Delivery
Only
Total Tax or Fee Rate
Santa Barbara 5 1 6 6.0%
Santa Barbara County 2 0 2 6.0%
Buellton - - - - Carpinteria - 0 0 -
Goleta 6 1 7 5.0%
Guadalupe 1 0 1 7.5%
Lompoc 7 1 8 6.0%
Santa Maria - - - - Solvang (medicinal only) 0 0 0 5.0% Ventura County - - - - Camarillo - - - - Fillmore - - - - Moorpark - - - - Ojai 3 1 4 3.0% Oxnard 10 - 10 4.0%
Port Hueneme 10 5 15 5.0%
Santa Paula - - - - Simi Valley - - - - Thousand Oaks 2 0 2 4.0% Ventura 3 0 3 4.0%
San Luis Obispo County - 6 6 6.0%
Arroyo Grande - - - - Atascadero - - - 6.0%
Grover Beach 4 0 4 5.0%
Morro Bay 2 0 2 5.0%
Paso Robles1 - 1 1 6.0%
Pismo Beach - - - - San Luis Obispo City 2 0 2 6.0%
57 16 73 5.3%
Los Angeles County - - - 4.0%
Los Angeles City2
275 66 341 10.0%
San Diego County 0 1 1 2.0%
San Diego City3
26 0 26 10.0%
Long Beach4
2 0 2 7.0%
HdL Recommended Range 4.0% - 7.0%
Red or - indicates not allowed; Green indicates allowed 1 Paso Robles has a rate of 6.0% for deliveries and 10.0% for storefront sales, but storefronts are not currently allowed. 2 The City of Los Angeles has a rate of 5.0% for medicinal sales and 10.0% for adult-use sales. 3 The City of San Diego recently increased its retail cannabis tax rate from 8.0% to 10.0%. 4 The CIty of Long Beach has a rate of 6.0% for medicinal sales and 7.0% for adult-use sales.

Total / Average Other
Figure 1: Santa Barbara County Ventura County San Luis Obispo County Cannabis Retail Types Allowed in Nearby Jurisdictions
City/County
Retail cannabis tax rate among these jurisdictions range from a low of 3.0% in Ojai to a high of

7.5% in Guadalupe1. The average rate among all jurisdictions in these three counties is 5.3%, but the average rate among jurisdictions in Santa Barbara County is just under 6.0%. The most common rate among all these jurisdictions is 6.0%2.

Figure 1 also includes a selection of other major Southern California cities (Los Angeles, Long Beach and San Diego) and the counties of Los Angeles and San Diego. The cities of Los Angeles and San Diego both have significantly higher rates than any of the jurisdictions in our 3-county sample set. The City of Los Angeles sets a rate of 10.0% for adult-use cannabis sales, though medicinal sales pay a much lower rate of 5.0%. The City of San Diego recently increased its retail cannabis tax rate from 8.0% up to 10.0%, bucking the current trend of reducing cannabis tax rates.

The City of Long Beach also has different rates for both medicinal and adult-use cannabis.

Medicinal sales pay a rate of 6.0% while adult-use sales pay a rate of 7.0%. For cities with separate rates, Figure 1 only shows the rate for adult-use sales, as these generally account for 90% or more of all sales.

Los Angeles County and San Diego County both have significantly lower rates than their largest cities. Los Angeles County has a rate of only 4.0% and San Diego County has a rate of just

2.0%. The County of Los Angeles has no licensed cannabis retailers as the County has not yet finalized its licensing and regulatory program. The County of San Diego has a regulatory program in place but has not yet issued any cannabis licenses. The sole non-storefront retailer in the County is a legacy Proposition 215-compliant medical marijuana dispensary that was “grandfathered in” to allow it to keep operating.

Lastly, Figure 1 shows the retail cannabis tax rates commonly recommended by HdL, ranging from 4.0% up to 7.0%. HdL provides this as a range rather than a specific recommended rate as the rates should be generally consistent with those in other nearby jurisdictions. Consumers are commonly willing to drive up to 15 or 20 minutes to make routine purchases and don’t necessarily limit their purchases to the nearest store in their own city. Setting a rate that is more than one or two percent above those in neighboring cities could have a noticeable effect on prices and potentially impact consumer shopping choices. Given the local average rate of 6.0%, we would recommend the City not exceed 8.0% so as to remain competitive.

In addition, even a small difference in retail tax rates can have an impact on profit margins and business competitiveness. Cannabis taxes are often incorporated into the list price for products, rather than added to the receipt at time of sale. Given this, if two nearby stores show the same list price but one pays a lower tax, that retailer gets to pocket the difference as profit (all other things being equal). Adding one or two percent to a business’s profit margin can be a significant factor in helping a retailer remain competitive.

1 The City of Guadalupe uses development agreements with a negotiated community benefit fee instead of a voter-approved tax. The one retailer in the City pays a fee of 6.0% to the City for general fund purposes and pays an additional 1.5% to support various non-profits and community organizations. The combined rate is 7.5%. 2 The City of Paso Robles has a rate of 6.0% for deliveries and 10.0% for storefront sales, but storefront sales are not currently allowed. Figure 1 only includes the rate for deliveries for this reason.

Figure 2, below, illustrates how the various state and local taxes applied to retail sales of cannabis are layered on one another to produce a higher cumulative tax rate. We have provided two pairs of columns to show both the City’s current rate of 6% (in red) and a higher rate of

10.0% which is in line with the cities of Los Angeles and San Diego.

Starting with a hypothetical purchase amount of $100, the product is first subject to the local cannabis tax. Applying the City’s current rate of 6.0% equals $6, increasing the total price up to $106. The state’s cannabis excise tax3 of 15.0% is then applied to that higher amount, adding another $15.90 and increasing the total purchase up to $121.90. State and local sales taxes are then applied to this increased amount. At the local rate of 9.25%, this adds another $11.28 and increases the total out-the-door purchase to $133.18. Of this, $33.18 is taxes. Adding all of these taxes together gives a combined rate of 30.25%, but a cumulative rate of 33.18% due to the way the taxes are stacked on top of each other.

Applying a higher local cannabis tax rate of 10.0% produces a higher basis upon which the state’s cannabis excise tax and the state and local sales taxes are applied. Since these taxes, in turn, are each being applied to a higher basis, they each produce a greater increase, amounting to a total out-the-door purchase of $138.20, or an increase of $5.02 on a purchase price of $100. Even though the difference between a rate of 6.0% and a rate of 10.0% is 4.0%, the net effect of the higher rate is a difference of 5.02% under this scenario. This illustrates how the layering of state and local taxes on top of one another creates a cumulative tax rate that is greater than the sum of its parts.

3 California’s cannabis excise tax increased from 15% up to 19% as of July 1 as a condition of previous legislation that eliminated the state’s separate cannabis cultivation tax. This increase was rolled back to 15% with Governor Newsom’s signing of AB 564 which became effective as of October 1.

Rate Amount Rate Amount
Purchase Amount $100.00 $100.00
Cannabis Business Tax 6.00% $6.00 10.00% $10.00
Subtotal $106.00 $110.00
State Cannabis Excise Tax 15.00% $15.90 15.00% $16.50
Subtotal $121.90 $126.50
State and Local Sales Taxes 9.25% $11.28 9.25% $11.70
Total Due $133.18 $138.20
Total Taxes 30.25% $33.18 34.25% $38.20
Total Cumulative Tax Rate 33.18% 38.20%
State and Local Cannabis Tax Calculation
Sources:
https://cdtfa.ca.gov/industry/cannabis/tax-facts.htm#note6 https://cdtfa.ca.gov/taxes-and-fees/rates.aspx
Figure 2:
1 ORDINANCE NO. _____

AN ORDINANCE OF THE COUNCIL OF THE CITY OF

SANTA BARBARA ADJUSTING TAX RATES OF CANNABIS

BUSINESSES PURSUANT TO SANTA BARBARA
MUNICIPAL CODE SECTION 5.42.250 AND RESCINDING
ORDINANCE NO. 5831

THE COUNCIL OF THE CITY OF SANTA BARBARA DOES ORDAIN AS FOLLOWS:

SECTION 1. The tax rate for medical cannabis businesses shall be up to 20.0%, except as reduced pursuant to SBMC section 5.42.250 for the different categories of medical cannabis businesses set forth below. These reduced rates are established effective July 1, 2026, subject to the City Council’s power under SBMC section §5.42.660.

Storefront Retail 8.0%
Retail by delivery only 8.0%
Manufacturing 4.0%
Distribution 4.0%
Testing 4.0%
Indoor Cultivation 2.0%
SECTION 2. The tax rate for non-medical cannabis businesses shall be up to

20.0%, except as reduced pursuant to SBMC section 5.42.250 for the different categories of non-medical cannabis businesses set forth below. These reduced rates are established effective July 1, 2026, subject to the City Council’s power under SBMC section §5.42.660.

Storefront Retail 8.0%
Retail by delivery only 8.0%
Manufacturing 4.0%
Distribution 4.0%
Testing 4.0%
Indoor Cultivation 2.0%
SECTION 3. Santa Barbara Ordinance No. 5831 shall be rescinded upon the effective date of the new rates established herein.

ATTACHMENT 2
1 ORDINANCE NO. _____

AN ORDINANCE OF THE COUNCIL OF THE CITY OF
SANTA BARBARA AMENDING SECTION 2.42.040,
CHAPTER 9.160 AND CHAPTER 9.165, AND REPEALING
CHAPTER 9.150 OF THE SANTA BARBARA MUNICIPAL

CODE RELATING TO EXPANDED POLYSTYRENE,

SINGLE-USE PLASTICS, AND SOLID WASTE

REDUCTION

THE CITY COUNCIL OF THE CITY OF SANTA BARBARA DOES ORDAIN AS FOLLOWS:

SECTION 1. Section 2.24.040 of Chapter 2.42 of Title 2 of the Santa Barbara Municipal Code is amended to read as follows:

2.42.040 Function of Department.

The function of the Department is the administration of matters pertaining to sustainability or resilience for the City and any other functions assigned by the City Administrator. The Sustainability and Resilience Department is designated as the local agency for enforcement of any provision of Part 3 of Division 30 of the California Public Resources Code whenever designation of such a local enforcement agency is required by State law.

SECTION 2. Chapter 9.160 of Title 9 of the Santa Barbara Municipal Code is amended to read as follows:

9.160.010 Title.

The title of this Chapter shall be “Polystyrene Food Containers and Products."

9.160.020 Purpose.

The purpose of these provisions is to promote:

A. The protection of the City's unique waterways and coastal resources including beaches, tidelands, creeks and riparian habitat.

B. To protect the public health, safety and general welfare.

C. Compliance with federal, state, and local laws regarding water quality and waste diversion.

D. A reduction in the amount of waste/debris in City parks, public open spaces, creeks, tidelands and the ocean, and the amount of material going to landfills.

Agenda Item No. 1
2 9.160.030 Definitions.

The following words and phrases, whenever used in this chapter, shall have the meanings defined in this section unless the context clearly requires otherwise:

A. BIODEGRADABLE. A material that is compostable (separately defined) or the ability of organic matter to break down from a complex to a more simple form through the action of bacteria or to undergo this process.

B. CITY FACILITY. Any building, structure or vehicle owned and operated by the City, its agents, agencies, and departments.

C. CITY CONTRACTOR. Any person or entity that enters into an agreement with the City to furnish products or services to or for the City.

D. COMPOSTABLE. An item or material that:

1. Meets standards for compostability from a certified/approved independent third-party approved by the Sustainability and Resilience Department or designee, in collaboration with local waste processors, haulers, and/or other entities, as needed; and/or

2. Is any variation of acceptable materials that will break down or otherwise become part of usable compost in a safe and timely manner as determined by the Sustainability and Resilience Department or designee, in collaboration with local waste processors, haulers, and/or other entities, as needed; and

3. Is Natural Fiber-based. Compostable items may include those that are made entirely of Natural Fiber or Natural Fiber-based items that are coated or lined with biologically based polymer, such as, but not limited to corn or other plant sources (e.g., compostable plastics), if certified/approved by independent third parties approved by the Sustainability and Resilience Department or designee.

Compostable does not include items made entirely/primarily of biologically based polymer (e.g., PLA, PHA, or other compostable plastic), even if labeled or certified as compostable.

E. DISPOSABLE FOOD CONTAINER. A term interchangeable with to-go packaging and food packaging material and means all containers that are used to hold prepared food or drinks. Disposable food containers include clamshells, bowls, plates, trays, cartons, and cups that are intended for single use, including, without limitation, food containers for takeout foods and/or leftovers from partially consumed meals prepared by food providers.

F. EVENTS PROMOTER. An applicant for any event permit issued by the City or any City employee(s) responsible for any City-organized event.

G. FOOD PROVIDER. Any person located within the City that is a retailer of prepared food or beverages for public consumption including, but not limited to, any store, supermarket, delicatessen, restaurant, shop, caterer or mobile food vendor. 3 H. FOODWARE. Products used for serving, consuming or transporting prepared food or raw food or beverages, including, but not limited to, plates, bowls, trays, cups or drink ware, or any container in or on which food or beverages are placed or packaged for consumption, as well as accessory items such as wrappers or wrapping, condiment containers, straws, and utensils.

I. PERSON. An individual, business, event promoter, trust, firm, joint stock company, corporation, nonprofit, including a government corporation, partnership, or association.

J. POLYSTYRENE. A thermoplastic petrochemical material utilizing the styrene monomer, including, but not limited to, rigid polystyrene or expanded polystyrene, processed by any number of techniques, including, but not limited to, fusion of polymer spheres (expandable bead polystyrene), injection molding, expanded polystyrene molding, or extrusion-blow molding (extruded polystyrene), and clear or solid polystyrene (oriented polystyrene). The resin code for polystyrene is ‘6’ or ‘PS,’ either alone or in combination with other letters. This definition applies to all polystyrene foodware, regardless of whether it exhibits a resin code.

K. POLYSTYRENE COOLER. Any cooler or ice chest made of polystyrene foam (expanded polystyrene), where such foam is not fully encased in another more durable material.

L. POLYSTYRENE FOODWARE. Foodware that contains or utilizes polystyrene.

M. POLYSTYRENE PACKAGES. Any meat and fish trays, produce trays, or egg cartons made, in whole or in part, from polystyrene, either as separate items or as part of the sale of meat, fish, poultry, vegetables, fruit, or eggs sold to consumers.

N. POLYSTYRENE PACKING MATERIAL. Polystyrene material is used to hold, cushion, or protect items packed in a container for shipping, transport, or storage, including shipping boxes and packing peanuts.

O. RECYCLABLE. Materials that can be recycled consistent with the requirements of Chapter 7.16, including, but not limited to, aluminum, tin and bi-metal cans, clear and colored glass containers, high density polyethylene (HDPE), polyethylene terephthalate (PET), clear or rigid polystyrene, corrugated cardboard and mixed paper.

P. VENDOR. Any store or business which sells or offers goods or merchandise, located or operating within the City, including those referenced in the definition of "food provider."

9.160.040 Prohibition of Specified Polystyrene Products.

It is unlawful within the City for a person to sell, offer for sale, distribute, or provide for use by others any polystyrene foodware, cooler, package, or packing material.
4 9.160.050 Exemptions.

A. This chapter does not apply to personal use by individuals of polystyrene foodware, packages, packaging, or coolers.

B. This chapter does not apply to the following polystyrene products:

1. Products made from expanded polystyrene which are wholly encapsulated or encased by a more durable material. Examples include surfboards, life preservers, and craft supplies which are wholly encapsulated or encased by a more durable material, and coolers encased in hard plastic.

2. Construction products made from expanded polystyrene are exempted from this chapter if the products are used in compliance with Title 22, Environmental Policy and Construction, and Chapter 22.87, Stormwater Management, for development and redevelopment projects, and used in a manner preventing the expanded polystyrene from being released into the environment.

3. Expanded polystyrene packaging products which have been received from sources outside the City may be reused in order to keep the products out of the waste stream.

9.160.060 Penalties and Enforcement.

A. The presence of non-recyclable plastic food containers on the premises of a food provider shall constitute a rebuttable presumption that such packaging is being dispensed.

B. Violations of this chapter shall be enforced as follows:

1. For the first violation, upon a determination that a violation of this chapter has occurred, the City shall issue a written warning notice to the food provider which will specify the violation and the appropriate penalties in the event of future violations.

2. Thereafter, any person violating or failing to comply with any of the requirements of this chapter shall be subject to remedies specified pursuant to Chapters 1.25 and 1.28 of this code.

3. Each and every sale or other transfer of non-recyclable plastic food packaging shall constitute a separate violation of this chapter.

4. The City Attorney may seek legal, injunctive, or other equitable relief to enforce this chapter.

C. The remedies and penalties provided in this chapter are cumulative and not exclusive of other remedies and penalties available under other provisions of applicable law.

D. The Enforcement Officer as designated by Chapter 7.16 of this Code is responsible for enforcement and administration of this Chapter. The Enforcement 5 Officer is authorized to conduct inspections, issue citations, and to obtain inspection warrants for enforcement of this Chapter.

SECTION 3. Chapter 9.165 of Title 9 of the Santa Barbara Municipal Code is amended to read:

9.165.010 Title.

The title of this chapter shall be “Solid Waste Reduction and Recycling.”

9.165.020 Definitions.

The following words and phrases, whenever used in this chapter, shall have the meanings defined in this section unless the context clearly requires otherwise:

A. ASEPTIC PAPER PACKAGING. Shelf-safe packaging typically containing layers of paper, plastic, and aluminum.

B. BALLOON. A flexible bag, including, but not limited to, those made from rubber latex, foil, metal, polychloroprene, Mylar, or nylon fabric, that is designed to be inflated with air or gas lighter than air such as helium, hydrogen, nitrous oxide, or oxygen, causing it to float.

C. BEVERAGE. Any liquid, including any slurry, frozen, semi-frozen, or other forms of liquids, intended for drinking.

Beverage Provider. Any business, organization, entity, group, or individual located within the City that offers beverages to the public for consumption.

City-Sponsored Event. Any event organized or sponsored by the City or any department of the City.

D. FOOD PROVIDER. Any person located within the City that is a retailer of prepared food or beverages for public consumption including, but not limited to, any delicatessen, restaurant, shop, caterer, mobile food vendor, or store or supermarket that provides retail to-go or eat-in food or beverage service.

E. FOOD. Food includes prepared food and raw food.

F. FOODWARE. Products used for serving, consuming or transporting prepared food or raw food or beverages, including, but not limited to, plates, bowls, trays, cups or drinkware, or any container in or on which food or beverages are placed or packaged for consumption, as well as accessory items such as wrappers or wrapping, condiment containers, straws, and utensils.

G. FLUORINATED CHEMICAL. A class of fluorinated organic compounds containing at least one fully fluorinated carbon atom, also known as perfluoroalkyl and polyfluoroalkyl substances, or PFAS chemicals.
6 H. FLUORINATED CHEMICAL FREE. An item that: (1) contains no intentionally added fluorinated chemicals beyond a City-determined acceptable threshold; (2) is listed, described, or referenced as fluorinated chemical free on the City’s website; and (3) is either certified by the Biodegradable Product Institute (BPI) or other third party as recognized by the City; or (4) is a napkin, stirrer, splash stick, cocktail stick, toothpick, or utensil made entirely of natural fiber, containing no intentionally added fluorinated chemicals.

I. LATEX BALLOON. A balloon made with the sap from a rubber tree. During the manufacturing process many chemicals are added to raw rubber including pigments, oils, curing agents and accelerators.

J. PERSON. An individual, business, event promoter, trust, firm, joint stock company, corporation, nonprofit, including a government corporation, partnership, or association.

K. PLASTIC BEVERAGE BOTTLE. Any formed or molded beverage container comprised predominantly of plastic resin, having a relatively inflexible fixed shape or form, having a neck that is smaller than the container body, and intended primarily as a singleservice container.

L. PLASTIC BEVERAGE STRAW. A tube made predominantly of plastic derived from either petroleum or a biologically based polymer, such as corn or other plant sources, for transferring a beverage from its container to the mouth of the drinker. Plastic beverage straw includes compostable and biodegradable petroleum or biologically based polymer straws, but does not include straws that are made from non-plastic materials, such as paper, sugar cane, bamboo, etc.

M. PLASTIC CUTLERY. Any utensil, such as a fork, spoon, spork, or knife, made predominantly of plastic derived from either petroleum or a biologically based polymer, such as corn or other plant sources intended for only one-time use. Plastic cutlery includes compostable and biodegradable petroleum or biologically based polymer forms of cutlery, but does not include forms of cutlery that are made from non-plastic materials, such as paper, sugar cane, bamboo, etc.

N. PLASTIC STIRRER. A device that is used to mix beverages, intended for only one-time use, and made predominantly of plastic derived from either petroleum or a biologically based polymer, such as corn or other plant sources. Plastic stirrer includes compostable and biodegradable petroleum or a biologically based polymer stirrers, but does not include stirrers that are made from non-plastic materials, such as paper, sugar cane, bamboo, etc.

O. REUSABLE BEVERAGE CUP. Any vessel or container for a Prepared Food beverage that is specifically designed and manufactured for repeated cleaning, disinfecting, and reuse at least 100 times, and is dishwasher safe.

P. REUSABLE FOODWARE. All foodware, including plates, bowls, cups, trays, glasses, straws, stirrers, condiment cups and utensils, that is manufactured of 7 durable materials and that is specifically designed and manufactured to be washed and sanitized and to be used repeatedly over an extended period of time, and is safe for washing and sanitizing according to applicable regulations.

9.165.030 Sale or Distribution of Plastic Cutlery and Plastic Beverage Straws and Stirrers Prohibited.

A. It is unlawful for any food provider or beverage provider to use plastic utensils or plastic beverage straws or stirrers, or to provide, distribute, or sell plastic utensils or plastic beverage straws or stirrers to any person.

B. Nothing in this section precludes a food provider or beverage provider from using, providing, distributing, or selling non-plastic alternatives to plastic utensils or plastic beverage straws, such as those made from paper, sugar cane, or bamboo, available to customers. Non-plastic alternative straws and utensils shall be provided only upon request.

C. It is unlawful for any person, food provider or beverage provider to distribute plastic utensils or plastic beverage straws or stirrers at any City facility or any Citysponsored event.

9.165.040 Disposable Foodware Standards.

A. No person shall sell or distribute disposable foodware and disposable foodware accessories that do not comply with City of Santa Barbara municipal compost collection programs and are not free of all intentionally added fluorinated chemicals, as certified by the Biodegradable Product Institute (BPI) or other independent third party certifying organization or agency recognized by the City, except that non-compostable foil wrappers that are accepted in the City of Santa Barbara recyclable collection program may be used for burritos, wraps, and other items that require foil to contain and form the food item.

B. The City shall maintain on its website a guide to disposable foodware and disposable foodware accessories that comply with these disposable foodware standards.

C. Food providers and beverage providers may request an exemption from the Sustainability and Resilience Director for specific disposable foodware items.

D. To obtain an exemption or extension for a disposable foodware or disposable foodware accessories item, the food provider or beverage provider must demonstrate that:

1. No disposable foodware or disposable foodware accessories exist with substantially similar size, performance and/or utility that conforms with the disposable foodware standards.

2. Food providers and beverage providers must provide documentation of good faith efforts to obtain a substantially similar compliant item. 8 3. Records of attempts to obtain a compliant item may include emails, letters or other correspondence with vendors that furnish disposable foodware or disposable foodware accessories, seeking the compliant item and a timeline for compliance.

9.165.050 Reusable Foodware for Dining on the Premises.

A. Prepared food or raw food or beverages served for consumption on the premises of food providers and beverage providers shall only be served using reusable foodware, except that disposable paper food wrappers, sleeves and bags; foil wrappers; paper napkins; straws and paper tray- and plate-liners shall be allowed for dining on the premises, so long as they meet the disposable foodware standards in Section 9.165.040.

B. Notwithstanding the requirements of subsection A above, food providers and beverage providers that do not have on-site or off-site dishwashing capacity or are unable to contract for services to wash, rinse and sanitize reusable foodware in compliance with the California State Health Code may request an extension or exemption.

To obtain an extension or exemption, the prepared food vendor must demonstrate an inability to comply due to insurmountable space constraints, undue hardship and/or other extraordinary, insurmountable circumstances.

C. All disposable foodware and disposable foodware accessories used on the premises by food providers and beverage providers that are operating under full or partial extension or exemption obtained shall conform to the disposable foodware standards in Section 9.165.040.

D. Extensions for reusable foodware may be granted for a specified term of up to two years. During the extension term, the food vendor shall make diligent efforts to become compliant with the Section. Under extraordinary circumstances, should a food vendor demonstrate that, at the close or expiration of a granted extension term, and with diligent efforts to become compliant, compliance remains infeasible, additional waivers of up to two years each may be granted. It shall be the food vendor’s responsibility to apply for any subsequent extensions in a timely manner.

E. Notwithstanding the two year maximum term for extensions set forth for reusable foodware in this subsection, in certain limited and unique circumstances existing prior to adoption of this chapter, where the food vendor demonstrates diligent efforts to comply but, due to insurmountable space and/or other unique and extraordinary circumstances, may never be reasonably able to comply, the Sustainability and Resilience Director may grant an extension for a longer specified term.

9.165.060 Single-Use Plastic Water Bottle Ban.

A. No person in the City shall, on behalf of a business or other organization, distribute water in single-use plastic bottles equal to or less than 8 fluid ounces in volume.

All City vendors, concessionaires, lessees, licensees, and permittees for facility use, special events, and temporary activities shall comply with this section. 9 B. No vendor shall sell water in single-use plastic bottles equal to or less than 8 fluid ounces in volume in the City.

C. The provisions of this section shall not apply in the following cases:

1. Cases of emergency or other City situations where the Sustainability and Resilience Director finds that relying on single-use plastic water bottles is necessary to protect the public health, safety, and welfare, and no reasonable alternative would serve the same purpose, including lack of available potable water due to a natural disaster.

2. Provision of social services in which the distribution of water in single-use plastic bottles is necessary to promote public health, including without limitation to food banks and warming shelters.

3. Healthcare settings, to the extent that the healthcare provider determines that distribution of water in single-use plastic bottles is necessary for patient care, provided that this exemption shall not apply to the commercial sale of single-use plastic bottles within a healthcare facility.

9.165.070 Regulation of the Sale, Distribution, and Use of Balloons.

A. No person shall sell or distribute foil, metalized, or Mylar balloons within the City either as a separate item or included in a packaged product set.

B. No person shall use foil, metalized, or Mylar balloons on public property within City limits, including, but not limited to, parks and beaches.

C. No person shall use or distribute latex balloons filled with air or lighter than air gas at any City sponsored event.

D. No person shall intentionally release foil, metalized, mylar, or latex balloons filled with lighter than air gas anywhere within the City limits.

9.165.080 Municipal Single-Use Beverage Bottles.

No City officer, official, employee, representative, contractor or agent, shall use, sell, distribute or otherwise provide any single-use plastic beverage bottle or aseptic paper packaging while acting on behalf of the City or while acting pursuant to a contract or agreement with the City.

9.165.090 Required Use of Reusable Beverage Cups at Special Events.

A. Any person providing food or beverage at a special event subject to Chapter

15.17 of this Code must ensure that at least 10% of beverages served at the event are served in reusable beverage cups.

B. A person may meet the requirement of subsection A by providing or selling reusable beverage cups at the event and may provide incentives for attendees to bring their own reusable beverage cups. A person applying for a special event permit must 10 state in the permit application how the requirement in subsection A. will be met. The compliance method will be a condition of permit issuance.

C. An applicant for a special event permit may request a full or partial waiver of the requirements of this Section if the applicant can demonstrate an inability to obtain reusable beverage cups for the special event, or that the application of this Section would create undue hardship or practical difficulty for the applicant. The Special Event Coordinator shall obtain the approval of the Sustainability and Resilience Department before including a waiver in a special event permit.

9.165.100. Prohibition of the Sale, Distribution and Use of Foil, Metalized, Mylar, or Plastic Confetti.

A. No person shall sell or distribute foil, metalized, Mylar, or plastic confetti within the City.

B. No person shall use or distribute foil, metalized, Mylar, or plastic confetti on public property within City limits, including, but not limited to streets, sidewalks, parks, and beaches.

C. No person shall use or distribute foil, metalized, Mylar, or plastic confetti at any City function or City sponsored event.

9.165.110 Exemptions and Enforcement.

A. Food providers and beverage providers are exempt from the provisions of this chapter under the following circumstances:

1. During a locally declared emergency, the City, emergency response agencies operating within the City, users of City facilities, and food providers and beverage providers shall be exempt from the provisions of this chapter.

2. The provision of plastic beverage straws, stirrers or cutlery when the plastic beverage straws, stirrers or cutlery are provided as a part of product that was packaged outside the City and sold within the City.

3. The food provider or beverage provider provides or distributes a plastic beverage straw to a person in order to assure full compliance with the Americans with Disabilities Act (42 USC Section 12102).

B. The Enforcement Officer as designated by Chapter 7.16 of this Code is responsible for enforcement and administration of this Chapter. The Enforcement Officer is authorized to conduct inspections, issue citations, and to obtain inspection warrants for enforcement of this Chapter.

C. Pursuant to California Public Resources Code Section 42272, the Sustainability and Resilience Department is designated as the agency for enforcement of Chapter 5.2 (commencing with Section 42270) of Part 3 of Division 30 of the California Public Resources Code.
11 9.165.120 Penalties.

The penalties for violation of this chapter shall be as follows:

A. For the first violation, a written warning notice will be issued to the beverage provider or food provider in order to confirm their understanding of the ordinance and the potential penalties in the event of future violations.

B. The second and each successive violation shall be punishable by civil administrative fines pursuant to Chapter 1.25 of this code. This chapter shall not be criminally enforceable.

C. Violations of this chapter shall be deemed to create a public nuisance. The City Attorney may seek legal, injunctive, or other equitable relief to enforce this chapter.

Each and every piece of plastic cutlery, plastic beverage straws, or plastic stirrers provided in violation of this chapter shall constitute a separate violation of this chapter and a continuing nuisance.

9.165.125 Certification of Compliance.

All businesses that are subject to this chapter shall certify compliance with this chapter on the annual business license renewal application.

SECTION 4. Title 9, Chapter 9.150 of the Santa Barbara Municipal Code is repealed.

CITY OF SANTA BARBARA

COUNCIL AGENDA REPORT
AGENDA DATE: February 24, 2026
TO: Mayor and Councilmembers
FROM: City Administrator’s Office
SUBJECT: Affordability Covenant Amendment for the Village Apartments Property Located At 518–524 West Canon Perdido Street
[Ordinance Introduction; Agreement]
RECOMMENDATION:

That Council introduce and subsequently adopt, by reading of title only, an Ordinance of the Council of the City of Santa Barbara Approving and Authorizing the City Administrator to Execute the Second Amended Affordability Control Covenant Imposed on Real Property with Turner Lighthouse L.P. for Property Located at 518–524 West Canon Perdido Street.

DISCUSSION:

Background
The Turner Foundation – Since 1958 (owner) owns property located at 518–524 West Canon Perdido (also known as the Village Apartments). In January of 2015, City Council approved a loan in the amount of $275,000 from the City’s Community Development Block Grant (CDBG) fund to rehabilitate seven of the units (city-assisted units). As a condition of City funding, the city-assisted units were placed under a 90-year City Affordability Control Covenant Imposed on Real Property (original covenant) to restrict the tenancies to Low-Income households1. The loan was paid in full to the City on June 30, 2020.
1 Total income of the individuals living in the dwelling unit does not exceed the upper limit of the LowIncome category of 80 percent of the Area Median Income (AMI) as determined and published by the U.S. Department of Housing and Urban Development (HUD) and amended from time to time.

Agenda Item No. 2
Council Agenda Report
Affordability Covenant Amendment for the Village Apartments Property Located At 518– 524 West Canon Perdido Street [Ordinance Introduction; Agreement] February 24, 2026

Page 2 ends

Previous Covenant Modifications
In August of 2021, a subsequent First Amendment to Affordability Control Covenant Imposed on Real Property (covenant) was recorded on the property to correct a clerical error regarding the rental unit numbers. In August of 2024, a subsequent Second Amendment to Affordability Control Covenant Imposed on Real Property (covenant) was recorded on the property to allow for an entity other than a not-for-profit organization to be the owner while maintaining the affordability restriction on the city-Assisted Units. The total number of city-assisted units was also increased from seven to twenty-two (22).

Proposed Covenant Modifications
The Turner Foundation has requested a change in the ownership of the property from The Turner Foundation to Turner Lighthouse L.P., a California limited partnership. This is a joint venture between The Turner Foundation – Since 1958 and impact fund investor, Msquared. The transfer of grant deed was completed on December 31, 2024.

The Amendments also include a change in the total number of units and affordability restrictions. Two of the non-city assisted Units have been converted into a community center; therefore, there are presently 44 residential units (not the 46 units otherwise noted). Of the 22 City-assisted units, fifteen (15) will have affordability restrictions from the date of Ordinance adoption through June 1, 2035. The other seven City-assisted units will continue to be under the 90-year City Affordability Control Covenant.

BUDGET/FINANCIAL INFORMATION:

Modifying the property covenant will have no financial impact on the City as the City loan has been paid in full, and the seven city-assisted units will remain restricted to LowIncome tenant households in accordance with the covenant.

A copy of the agreement is available for public review; please contact Maria Schroeder at [email protected] to request a copy.

PREPARED AND
SUBMITED BY: Barbara Andersen, Senior Assistant to the City Administrator APPROVED BY: Kelly McAdoo, City Administrator
COUNCIL DRAFT 02/24/26
1 ORDINANCE NO.

AN ORDINANCE OF THE COUNCIL OF THE CITY OF SANTA

BARBARA APPROVING AND AUTHORIZING THE CITY

ADMINISTRATOR TO EXECUTE THE SECOND AMENDMENT

AFFORDABILITY CONTROL COVENANT IMPOSED ON REAL
PROPERTY WITH TURNER LIGHTHOUSE L.P. FOR PROPERTY
LOCATED AT 518 – 524 WEST CANON PERDIDO STREET

THE CITY COUNCIL OF THE CITY OF SANTA BARBARA DOES ORDAIN AS FOLLOWS:

In accordance with the provisions of Section 521 of the Charter of the City of Santa Barbara, an Ordinance of the Council of the City of Santa Barbara Approving and Authorizing the City Administrator to Execute the Second Amended Affordability Control Covenant Imposed on Real Property with Turner Lighthouse L.P. for Property Located at 518 – 524 West Canon Perdido Street, commencing upon the effective date of the enabling ordinance, a copy of which is on file with the City Clerk, is approved.

CITY OF SANTA BARBARA

COUNCIL AGENDA REPORT
AGENDA DATE: February 24, 2026
TO: Mayor and Councilmembers
FROM: Library Department
SUBJECT: Approval of the Fiscal Year 2025-2026 Agreement for Operation of a Countywide Library System and Appropriation of County Per Capita Funds [Resolution]
RECOMMENDATION: That Council:

A. Approve and authorize the City Administrator to execute the Fiscal Year 2025- 2026 Agreement for Operation of a Countywide Library System between the County of Santa Barbara and the City of Santa Barbara for the operation of Libraries belonging to the Countywide Library System; and B. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Resolution No. 25-066, Adopting the Budget for Fiscal Year 2026, to Increase Revenue and Expenditure Appropriations by $15,221 in the Fiscal Year 2026 Library General Fund and Increase Revenue Appropriations by $16,555 in the Fiscal Year 2026 Library County Fund Budget for County Per Capita Funds from the County of Santa Barbara for the Operation of Library Services.

DISCUSSION:

The Agreement for Operation of a Countywide Library System for Fiscal Year 2025-2026 (FY26) provides for continued funding of library services for all Santa Barbara County residents and designates the Cities of Santa Barbara, Lompoc, Goleta and Santa Maria as administrators of County Library Zones 1, 2, 3, and 4 respectively. The City of Santa Barbara furnishes library service to all persons inhabiting Library Zone 1, including the City of Santa Barbara, and the unincorporated areas of Montecito, Summerland, and Mission Canyon.

On June 30, 2025, the previous one-year contract expired. A new one-year contract allows the City of Santa Barbara to receive the recommended funding for library operations at City Libraries and the Montecito Branch Library. On December 16, 2025, the Santa Barbara County Board of Supervisors approved the FY26 Agreement, the Agenda Item No. 3
Council Agenda Report
Approval of the Fiscal Year 2025-2026 Agreement for Operation of a Countywide Library System and Appropriation of County Per Capita Funds [Resolution] February 24, 2026

Page 2 ends

content of which has not changed substantially from last year. The only changes of note are the increased County Per Capita and corresponding County Funding allocated to each branch in Table 1 of the agreement.

BUDGET/FINANCIAL INFORMATION:

The adopted FY26 General Fund Library budget for City Libraries included $845,180 and the adopted FY26 County Fund Library budget for the Montecito Branch Library included $366,584 in per capita revenue anticipated from the County of Santa Barbara. Per capita revenue was calculated using the previous year’s published population figures from the California State Library’s Certification of Population Figures (89,388 for Santa Barbara and Eastside; 9,080 for Montecito) and a County per capita allocation of $9.15.

Under the terms and conditions of the FY26 Agreement, the Santa Barbara Public Library will receive $1,243,540 from the County of Santa Barbara, a 2.7% increase from what the City received from the County for library operations in FY25. The increase from the FY26 Adopted Budget is from the County per capita allocation being raised to $9.42 and the estimated population figures increasing to 91,294 for Santa Barbara/Eastside and 9,321 for Montecito. The County per capita allocation for the City Libraries is $860,401 while the Montecito Branch Library was allocated $87,845 in County per capita, $230,294 in Cannabis/GFC funding, $50,000 in Small Library funding, and $15,000 in other County funding for a grand total of $383,139.

Staff requests that Council approve an increase in revenue and expenditure appropriations for the Library General Fund of $15,221 and increase in revenue appropriations for the Library County Fund of $16,555.

A copy of the contract/agreement is available for public review in the Library Administration Office.

PREPARED BY: Kathrin Rosenberger, Administrative Analyst SUBMITTED BY: Brandon Beaudette, Library Director
APPROVED BY: Kelly McAdoo, City Administrator
RESOLUTION NO.

A RESOLUTION OF THE COUNCIL OF THE CITY OF SANTA
BARBARA AMENDING RESOLUTION NO. 25-066,
ADOPTING THE BUDGET FOR FISCAL YEAR 2026, TO

INCREASE REVENUE AND EXPENDITURE
APPROPRIATIONS BY $15,221 IN THE FISCAL YEAR 2026

LIBRARY GENERAL FUND AND INCREASE REVENUE
APPROPRIATIONS BY $16,555 IN THE FISCAL YEAR 2026

LIBRARY COUNTY FUND BUDGET FOR COUNTY PER

CAPITA FUNDS FROM THE COUNTY OF SANTA BARBARA
FOR THE OPERATION OF LIBRARY SERVICES.

WHEREAS, the City was allocated $1,243,540 in County per capita funds for the operation of library services from the County of Santa Barbara; WHEREAS, in accordance with the City Charter, the City Administrator filed with the Council a proposed budget for the fiscal year beginning July 1, 2025; WHEREAS, the City Council is required to adopt a budget before the beginning of the fiscal year on July 1, 2025;
WHEREAS, the City Charter provides that at any public meeting after the adoption of the budget, the City Council may amend or supplement the budget by motion adopted by the affirmative votes of at least a majority of the total members of the City Council; and WHEREAS, as authorized by Resolution No. 25-066, this Resolution approves the amendment to the budget as provided herein.

NOW, THEREFORE, be it resolved by the Council of the City of Santa Barbara that:

1. The Council approve the execution of the Fiscal Year 2025-2026 Agreement for Operation of a Countywide Library System

2. In accordance with the provisions of Section 1205 of the City Charter the budget for fiscal year 2026 (Resolution No. 25-066) is amended to increase revenue and expenditure appropriations of $15,221 in the Fiscal Year 2026 General Fund and increase revenue appropriations by $16,555 in the Fiscal Year 2026 Library County Fund.

CITY OF SANTA BARBARA

COUNCIL AGENDA REPORT
AGENDA DATE: February 24, 2026
TO: Mayor and Councilmembers
FROM: Finance Department
SUBJECT: January 2026 Investment Report
RECOMMENDATION:

That Council accept the January 2026 Investment Report.

DISCUSSION:

The attached investment report includes Investment Activity, Interest Revenue, a Summary of Cash and Investments, and Investment Portfolio detail as of January 31, 2026.

ATTACHMENTS: 1. January 2026 Investment Report

2. January 2026 Clean Energy CCA Report

3. January 2026 PARS Section 115 Trust
PREPARED BY: Salvatore Parrilla, Treasury Analyst
SUBMITTED BY: Lyndsay Maas, Assistant Finance Director
APPROVED BY: Kelly McAdoo, City Administrator
Agenda Item No. 4
ENDING BALANCE AS OF January 31, 2026
Yield to
Book Maturity
Description Value (365 days)US Bank Checking Account $ 28,872,626 0.700% State of California Local Agency Investment Fund (LAIF) 51,716,668 3.931%Chandler Asset Management - Managed Portfolio 277,082,442 3.710% Total Cash and Investments $ 357,671,736
January 31, 2026
ATTACHMENT 1

CITY OF SANTA BARBARA
Checking Account, LAIF & Managed Portfolio
Summary of Cash and Investments
City of Santa Barbara Managed | Account #11204 | As of January 31, 2026 Execution Time: 02/04/2026 02:35:07 PM Chandler Asset Management | [email protected] | www.chandlerasset.com | 800.317.4747

PORTFOLIO SUMMARY
Portfolio Characteristics
Sector Allocation
Performance Review
Account Summary
Maturity Distribution
Top Issuers
Credit Quality*
Total Rate of Return** 1M 3M YTD 1YR 2YRS 3YRS 5YRS 10YRS Since Inception (08/01/24)
City of Santa Barbara Managed 0.25% 1.01% 0.25% 5.83% -- -- -- -- 5.03% Benchmark Return 0.16% 0.90% 0.16% 5.39% -- -- -- -- 4.65% Average Modified Duration 2.51
Average Coupon 3.41%
Average Purchase YTM 3.71%
Average Market YTM 3.78%
Average Credit Quality* AA+
Average Final Maturity 2.87
Average Life 2.73
End Values as of
12/31/2025
End Values as of
01/31/2026
Market Value 277,999,060.91 278,696,419.21
Accrued Interest 2,035,079.01 2,013,467.21
Total Market Value 280,034,139.92 280,709,886.42
Income Earned 1,125,276.68 518,528.53
Cont/WD 0.00 0.00
Par 278,794,292.31 279,571,747.55
Book Value 276,228,846.68 277,082,442.00
Cost Value 275,262,498.59 276,047,408.67
United States 39.90%
Federal Home Loan Mortgage Corp 9.93%
Federal Home Loan Banks 9.32%
Farm Credit System 5.32%
International Bank for Recon and Dev 3.35%
Pricoa Global Funding I 1.27%
Toyota Motor Corporation 1.20%
Deere & Company 1.20%
**Periods over 1 year are annualized.

Benchmark: ICE BofA 1-5 Year Unsubordinated US Treasury & Agency Index *The average credit quality is a weighted average calculation of the highest of S&P, Moody’s and Fitch.

RECONCILIATION SUMMARY
Accrual Activity Summary
Fair Market Activity Summary
Month to Date Fiscal Year to Date
(07/01/2025)
Beginning Book Value 276,228,846.68 271,882,321.01
Maturities/Calls (6,000,000.00) (24,000,000.00)
Principal Paydowns (2,751.15) (19,722.73)
Purchases 10,410,111.37 80,319,118.15
Sales (3,948,281.17) (51,798,548.90)
Change in Cash, Payables, Receivables 329,854.09 332,620.88 Amortization/Accretion 68,782.18 467,673.21
Realized Gain (Loss) (4,120.00) (101,019.61)
Ending Book Value 277,082,442.00 277,082,442.00
Month to Date Fiscal Year to Date
(07/01/2025)
Beginning Market Value 277,999,060.91 271,671,776.77
Maturities/Calls (6,000,000.00) (24,000,000.00)
Principal Paydowns (2,751.15) (19,722.73)
Purchases 10,410,111.37 80,319,118.15
Sales (3,948,281.17) (51,798,548.90)
Change in Cash, Payables, Receivables 329,854.09 332,620.88 Amortization/Accretion 68,782.18 467,673.21
Change in Net Unrealized Gain (Loss) (156,237.02) 1,824,521.45 Realized Gain (Loss) (4,120.00) (101,019.61)
Ending Market Value 278,696,419.21 278,696,419.21
Maturities / Calls
Month to Date (6,000,000.00)
Fiscal Year to Date (24,000,000.00)
Principal Paydowns
Month to Date (2,751.15)
Fiscal Year to Date (19,722.73)
Purchases
Month to Date 10,410,111.37
Fiscal Year to Date 80,319,118.15
Sales
Month to Date (3,948,281.17)
Fiscal Year to Date (51,798,548.90)
Interest Received
Month to Date 477,245.16
Fiscal Year to Date 4,633,201.14
Purchased / Sold Interest
Month to Date (5,887.01)
Fiscal Year to Date (47,954.76)
City of Santa Barbara Managed | Account #11204 | As of January 31, 2026 Execution Time: 02/04/2026 02:35:07 PM Chandler Asset Management | [email protected] | www.chandlerasset.com | 800.317.4747

HOLDINGS REPORT
Cusip Security Description Par Value/
Units
Purchase Date
Purchase Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody's/
S&P/
Fitch
Maturity
Duration
ABS
362962AD4 GMALT 2025-2 A3 4.58
05/22/2028 1,240,000.00 05/20/20254.84%
1,239,979.42
1,239,984.11
100.85

3.83%
1,250,592.08
1,735.31

0.45%
10,607.97
NA/AAA
AAA

2.31 1.07
096912AD2 BMWLT 2025-1 A3 4.43
06/26/2028 680,000.00 06/03/20254.82%
679,985.04
679,988.22
100.84

3.82%
685,735.12
502.07

0.25%
5,746.91
NA/AAA
AAA

2.40 1.29
05594HAD5 BMWLT 2025-2 A3 3.97
09/25/2028 1,420,000.00 10/08/20254.32%
1,419,996.02
1,419,996.42
100.18

3.87%
1,422,561.68
939.57

0.51%
2,565.26
NA/AAA
AAA

2.65 1.31
89240NAD4 TLOT 2025-B A3 3.96 11/20/2028 1,800,000.00 09/09/2025

3.97%
1,799,677.80
1,799,715.85
100.23

3.87%
1,804,086.00
2,178.00

0.65%
4,370.15
Aaa/NA
AAA

2.80 1.77
58768YAD7 MBALT 2025-A A3 4.61
04/16/2029 1,355,000.00 05/14/20254.66%
1,354,834.83
1,354,864.48
101.28

3.91%
1,372,381.94
2,776.24

0.49%
17,517.46
NA/AAA
AAA

3.21 1.70
44935XAD7 HART 2025-B A3 4.36
12/17/2029 1,030,000.00 06/03/20254.36%
1,029,906.99
1,029,920.24
101.01

3.78%
1,040,451.41
1,995.91

0.37%
10,531.17
NA/AAA
AAA

3.88 1.64
362549AD9 GMCAR 2025-2 A3 4.28
04/16/2030 650,000.00 05/06/20254.71%
649,904.32
649,918.32
100.70

3.77%
654,580.55
1,159.17

0.23%
4,662.23
Aaa/AAA
NA

4.21 1.29
92970QAJ4 WFCIT 2025-1 A 4.34
05/15/2030 2,135,000.00 06/03/20254.33%
2,134,964.56
2,134,969.21
101.18

3.83%
2,160,086.25
4,118.18

0.78%
25,117.04
NA/AAA
AAA

4.28 2.14
17305EHA6 CCCIT 2025-A1 A1 4.3
06/21/2030 2,105,000.00 06/18/20254.31%
2,104,428.91
2,104,497.90
101.03

3.84%
2,126,715.18
10,057.22

0.76%
22,217.28
Aaa/AAA
NA

4.39 2.24
Total ABS 12,415,000.00 4.41%
12,413,677.89
12,413,854.74
100.82

3.84%
12,517,190.21
25,461.67

4.49%
103,335.47

3.45 1.72
AGENCY
3130ALGY4 FEDERAL HOME LOAN BANKS 1.0
03/16/2026 2,000,000.00 03/16/2021

0.80%
2,000,000.00
2,000,000.00

99.68 3.58%
1,993,698.00
7,500.00

0.72%
(6,302.00)
Aa1/AA+
AA+

0.12 0.12
31422X2U5

FEDERAL AGRICULTURAL
MORTGAGE CORP 3.625
05/15/2026
2,000,000.00 05/15/2023

3.62%
2,000,000.00
2,000,000.00

99.97 3.69%
1,999,498.00
15,305.56

0.72%
(502.00)
Aa1/AA+
AA+

0.28 0.28
3130AMDY5 FEDERAL HOME LOAN BANKS 1.0
05/20/2026 2,000,000.00 05/20/20211.00%
2,000,000.00
2,000,000.00

99.14 3.88%
1,982,876.00
3,944.44

0.71%
(17,124.00)
Aa1/AA+
AA+

0.30 0.30
3130AMMZ2 FEDERAL HOME LOAN BANKS 1.0
06/10/2026 2,000,000.00 06/10/20211.00%
2,000,000.00
2,000,000.00

99.10 3.55%
1,982,056.00
2,833.33

0.71%
(17,944.00)
Aa1/AA+
AA+

0.36 0.35
3133EMH21 FEDERAL FARM CREDIT BANKS
FUNDING CORP 0.9 06/15/2026 2,000,000.00 06/15/20210.90% 2,000,000.00
2,000,000.00

98.95 3.77%
1,979,072.00
2,300.00

0.71%
(20,928.00)
Aa1/AA+
AA+

0.37 0.36
3133ENHV5 FEDERAL FARM CREDIT BANKS
FUNDING CORP 1.39 06/22/2026 3,000,000.00 12/22/20211.39% 3,000,000.00
3,000,000.00

99.10 3.73%
2,973,057.00
4,517.50

1.07%
(26,943.00)
Aa1/AA+
AA+

HOLDINGS REPORT
Cusip Security Description Par Value/
Units
Purchase Date
Purchase Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody's/
S&P/
Fitch
Maturity
Duration
3133EM4S8 FEDERAL FARM CREDIT BANKS
FUNDING CORP 0.87 09/08/2026 2,000,000.00 09/08/20210.87% 2,000,000.00
2,000,000.00

98.35 3.68%
1,966,988.00
6,911.67

0.71%
(33,012.00)
Aa1/AA+
AA+

0.60 0.59
3130ANXS4 FEDERAL HOME LOAN BANKS 0.9
09/28/2026 2,000,000.00 09/28/20210.90%
2,000,000.00
2,000,000.00

98.21 3.68%
1,964,248.00
6,150.00

0.70%
(35,752.00)
Aa1/AA+
AA+

0.66 0.64
3130APHA6 FEDERAL HOME LOAN BANKS

1.25 10/28/2026 2,000,000.00 10/28/20211.12%
2,000,000.00
2,000,000.00

98.27 3.65%
1,965,350.00
6,458.33

0.71%
(34,650.00)
Aa1/AA+
AA+

0.74 0.72
3133ENLZ1 FEDERAL FARM CREDIT BANKS
FUNDING CORP 1.78 01/26/2027 3,000,000.00 01/27/20221.78% 3,000,000.00
3,000,000.00

98.27 3.59%
2,948,055.00
741.67

1.06%
(51,945.00)
Aa1/AA+
AA+

0.99 0.96
3130AQMX8 FEDERAL HOME LOAN BANKS

2.25 01/26/2027 3,000,000.00 01/26/2022

1.79%
3,000,000.00
3,000,000.00

98.74 3.57%
2,962,077.00
937.50

1.06%
(37,923.00)
Aa1/AA+
AA+

0.99 0.96
3133ENPB0 FEDERAL FARM CREDIT BANKS
FUNDING CORP 2.18 02/16/2027 3,000,000.00 02/16/20222.18% 3,000,000.00
3,000,000.00

98.61 3.55%
2,958,327.00
29,975.00

1.06%
(41,673.00)
Aa1/AA+
AA+

1.04 1.00
3130ARCB5 FEDERAL HOME LOAN BANKS

2.375 03/29/2027 3,000,000.00 03/29/20222.37%
3,000,000.00
3,000,000.00

98.60 3.61%
2,958,105.00
24,145.83

1.06%
(41,895.00)
Aa1/AA+
AA+

1.16 1.12
3133EPEE1 FEDERAL FARM CREDIT BANKS
FUNDING CORP 4.0 03/29/2027 2,000,000.00 03/29/20234.00% 2,000,000.00
2,000,000.00
100.52

3.54%
2,010,358.00
27,111.11

0.72%
10,358.00
Aa1/AA+
AA+

1.16 1.11
3134GXVN1

FEDERAL HOME LOAN
MORTGAGE CORP 3.5
06/23/2027
3,000,000.00 06/23/2022

3.50%
3,000,000.00
3,000,000.00

99.83 3.63%
2,994,774.00
11,083.33

1.07%
(5,226.00)
Aa1/AA+
AA+

1.39 1.34
3130AWWN6 FEDERAL HOME LOAN BANKS 4.5
09/10/2027 2,000,000.00 08/24/20234.51%
1,999,120.00
1,999,651.10
101.42

3.58%
2,028,468.00
35,250.00

0.73%
28,816.90
Aa1/AA+
AA+

1.61 1.51
3130AWC24 FEDERAL HOME LOAN BANKS 4.0
06/09/2028 2,000,000.00 06/26/20234.07%
1,993,600.00
1,996,962.65
100.96

3.57%
2,019,222.00
11,555.56

0.72%
22,259.35
Aa1/AA+
AA+

2.36 2.22
3130ATHX8 FEDERAL HOME LOAN BANKS

4.125 09/14/2029 3,000,000.00 10/17/20243.93%
3,025,380.00
3,018,709.25
101.35

3.72%
3,040,524.00
47,093.75

1.09%
21,814.75
Aa1/AA+
AA+

3.62 3.29
3130ATUT2 FEDERAL HOME LOAN BANKS 4.5
12/14/2029 3,000,000.00 12/16/20244.29%
3,028,440.00
3,022,028.13
102.83

3.71%
3,084,864.00
17,625.00

1.11%
62,835.87
Aa1/AA+
AA+

3.87 3.51
Total Agency 46,000,000.00 2.39%
46,046,540.00
46,037,351.13

99.61 3.64%
45,811,617.00
261,439.58

16.44%
(225,734.13)

1.26 1.19

AGENCY CMBS
3137FLMV3 FHMS K-090 A2 3.422
02/25/2029 1,357,000.00 02/12/20254.73%
1,292,065.43
1,307,714.48

98.74 3.81%
1,339,956.08
3,869.71

0.48%
32,241.60
Aa1/AAA
AA+

3.07 2.81
3137FLN91 FHMS K-091 A2 3.505
03/25/2029 2,570,000.00 09/20/20243.80%
2,537,272.66
2,547,264.81

98.88 3.85%
2,541,090.07
7,506.54

0.91%
(6,174.74)
Aa1/AAA
AA+

HOLDINGS REPORT
Cusip Security Description Par Value/
Units
Purchase Date
Purchase Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody's/
S&P/
Fitch
Maturity
Duration
3137FMCR1 FHMS K-093 A2 2.982
05/25/2029 2,462,105.80 09/19/20243.82%
2,375,355.04
2,400,915.53

97.41 3.83%
2,398,300.33
6,118.33

0.86%
(2,615.20)
Aa1/AA+
AAA

3.31 2.90
3137FNAE0 FHMS K-095 A2 2.785
06/25/2029 1,000,000.00 03/13/20254.39%
938,828.13
951,572.27

96.62 3.85%
966,211.00
2,320.83

0.35%
14,638.73
Aa1/AA+
AAA

3.40 3.08
3137FMTY8 FHMS K-094 A2 2.903
06/25/2029 3,000,000.00 12/05/20253.87%
2,903,554.69
2,907,582.74

96.93 3.86%
2,908,032.00
7,257.50

1.04%
449.26
Aa1/AA+
AAA

3.40 3.11
3137FPHK4 FHMS K-098 A2 2.425
08/25/2029 2,100,000.00 10/01/20243.83%
1,970,718.74
2,006,304.10

95.25 3.87%
2,000,262.60
4,243.75

0.72%
(6,041.50)
Aa1/AA+
AAA

3.56 3.26
3137H9D71 FHMS K-750 A2 3.0 09/25/2029 2,500,000.00 11/15/2024

4.62%
2,336,718.75
2,377,679.34

97.10 3.92%
2,427,517.50
6,250.00

0.87%
49,838.16
Aa1/AA+
AAA

3.65 3.03
3137FPJG1 FHMS K-099 A2 2.595
09/25/2029 2,800,000.00 06/06/20254.38%
2,609,140.63
2,638,208.65

95.65 3.89%
2,678,155.20
6,055.00

0.96%
39,946.55
Aa1/AA+
AAA

3.65 3.32
3137FQ3Z4 FHMS K-101 A2 2.524
10/25/2029 2,480,000.00 03/17/20254.42%
2,287,218.75
2,324,238.34

95.24 3.90%
2,361,964.40
5,216.27

0.85%
37,726.06
Aa1/AA+
AA+

3.73 3.43
3137FRUT6 FHMS K-106 A2 2.069
01/25/2030 2,700,000.00 07/14/20254.28%
2,457,843.75
2,487,425.76

93.14 3.94%
2,514,866.40
4,655.25

0.90%
27,440.64
Aa1/AA+
AAA

3.98 3.72
3137HA4B9 FHMS K-751 A2 4.412
03/25/2030 2,500,000.00 03/25/20254.41%
2,496,972.66
2,497,494.33
101.36

3.97%
2,534,037.50
9,191.67

0.91%
36,543.18
Aaa/AA+
AA+

4.15 3.44
Total Agency CMBS 25,469,105.80 4.20%
24,205,689.23
24,446,400.35

96.91 3.89%
24,670,393.08
62,684.85

8.85%
223,992.72

3.58 3.20
CASH
CCYUSD Receivable 340,001.62 -- 340,001.62
340,001.62

1.00 340,001.62

0.00 0.12%

0.00 Aaa/AAA
AAA

0.00 0.00
Total Cash 340,001.62
340,001.62
340,001.62

1.00 340,001.62

0.00 0.12%

0.00 0.00

0.00 CORPORATE
74153WCU1 PRICOA GLOBAL FUNDING I 4.4
08/27/2027 3,500,000.00 08/20/20244.41%
3,499,230.00
3,499,597.77
100.89

3.81%
3,531,244.50
65,877.78

1.27%
31,646.73
Aa3/AAAA1.57

1.48 66815L2T5

NORTHWESTERN MUTUAL
GLOBAL FUNDING 4.11
09/12/2027
2,440,000.00 09/05/2024

4.11%
2,439,926.80
2,439,960.69
100.41

3.84%
2,449,928.36
38,720.77

0.88%
9,967.67
Aa1/AA+
AAA

1.61 1.52
64953BBW7 NEW YORK LIFE GLOBAL
FUNDING 4.4 04/25/2028 1,880,000.00 04/22/20254.43%
1,878,684.00
1,879,022.61
101.07

3.89%
1,900,121.64
22,058.67

0.68%
21,099.03
Aa1/AA+
AAA

HOLDINGS REPORT
Cusip Security Description Par Value/
Units
Purchase Date
Purchase Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody's/
S&P/
Fitch
Maturity
Duration
69371RU20 PACCAR FINANCIAL CORP 4.0
11/07/2028 1,515,000.00 11/05/20254.02%
1,514,151.60
1,514,218.17
100.56

3.78%
1,523,461.28
14,140.00

0.55%
9,243.10
A1/A+
NA

2.77 2.57
61690DK72 MORGAN STANLEY BANK NA

5.016 01/12/2029 3,250,000.00 02/13/20254.93%
3,257,345.00
3,254,910.50
101.87

4.19%
3,310,892.00
8,603.83

1.19%
55,981.50
Aa3/A+
AA2.951.84
693475CG8 PNC FINANCIAL SERVICES
GROUP INC 4.075 01/26/2029 2,000,000.00 01/27/20264.03% 2,001,820.00
2,001,810.00
100.14

4.09%
2,002,818.00
1,131.94

0.72%
1,008.00
A3/AA2.99

1.89 78016HZV5 ROYAL BANK OF CANADA 4.95
02/01/2029 2,750,000.00 12/09/20244.59%
2,787,207.50
2,776,934.89
102.75

3.97%
2,825,506.75
68,062.50

1.01%
48,571.86
A1/A
AA3.002.77
09247XAP6 BLACKROCK FINANCE INC 3.25
04/30/2029 3,400,000.00 07/29/2024

4.60%
3,205,996.00
3,267,607.65

98.02 3.90%
3,332,690.20
27,931.94

1.20%
65,082.56
Aa3/AANA3.24

3.02 89236TMF9 TOYOTA MOTOR CREDIT CORP

5.05 05/16/2029 3,250,000.00 12/04/20244.55%
3,314,675.00
3,297,818.85
103.18

4.01%
3,353,203.75
34,192.71

1.20%
55,384.90
A1/A+
A+

3.29 2.99
24422EXT1 JOHN DEERE CAPITAL CORP 4.85
06/11/2029 3,250,000.00 07/18/20244.62%
3,281,980.00
3,271,928.12
102.83

3.94%
3,342,007.50
21,892.36

1.20%
70,079.38
A1/A
A+

3.36 3.06
437076DC3 HOME DEPOT INC 4.75
06/25/2029 3,250,000.00 07/18/20244.59%
3,272,652.50
3,265,464.07
102.54

3.94%
3,332,400.50
15,437.50

1.20%
66,936.43
A2/A
A

3.40 3.03
025816EJ4 AMERICAN EXPRESS CO 4.351
07/20/2029 2,245,000.00 07/21/20254.35%
2,245,000.00
2,245,000.00
100.62

4.19%
2,258,939.21
2,984.67

0.81%
13,939.21
A2/AA3.47

2.32 532457CQ9 ELI LILLY AND CO 4.2 08/14/2029 3,275,000.00 08/12/2024

4.24%
3,268,882.55
3,270,678.25
101.04

3.88%
3,309,132.05
63,807.92

1.19%
38,453.80
Aa3/A+
NA

3.53 3.13
171239AL0 CHUBB INA HOLDINGS LLC 4.65
08/15/2029 2,800,000.00 08/15/20244.47%
2,821,364.00
2,815,004.82
102.28

3.95%
2,863,870.80
60,036.67

1.03%
48,865.98
A2/A
A

3.54 3.10
14913UAQ3

CATERPILLAR FINANCIAL
SERVICES CORP 4.375
08/16/2029
3,275,000.00 08/12/2024

4.40%
3,270,820.05
3,272,042.45
101.50

3.92%
3,324,043.13
65,670.57

1.19%
52,000.68
A2/A
A+

3.54 3.19
69371RT48 PACCAR FINANCIAL CORP 4.0
09/26/2029 1,600,000.00 09/23/20244.05%
1,596,704.00
1,597,593.88
100.27

3.92%
1,604,262.40
22,222.22

0.58%
6,668.52
A1/A+
NA

3.65 3.32
857449AE2 STATE STREET BANK AND TRUST
CO 4.782 11/23/2029 2,750,000.00 12/09/20244.56%
2,776,977.50
2,770,743.89
102.86

3.97%
2,828,531.75
24,839.83

1.01%
57,787.86
Aa2/AAAA

3.81 3.43
59217GFT1 METROPOLITAN LIFE GLOBAL
FUNDING I 4.9 01/09/2030 3,100,000.00 --4.96%
3,092,094.00
3,093,717.22
102.15

4.30%
3,166,597.30
9,282.78

1.14%
72,880.08
Aa3/AAAA3.94

3.54 06406RCG0 BANK OF NEW YORK MELLON
CORP 4.026 01/22/2030 1,925,000.00 01/14/20264.05%
1,925,470.40
1,925,466.11

99.91 4.10%
1,923,246.33
1,937.51

0.69%
(2,219.78)
Aa3/A
AA3.972.77
95000U4D2 WELLS FARGO & CO 4.182
01/23/2030 2,000,000.00 01/27/20264.17%
2,000,380.00
2,000,378.61
100.08

4.21%
2,001,680.00
1,858.67

0.72%
1,301.39
A1/BBB+
A+

HOLDINGS REPORT
Cusip Security Description Par Value/
Units
Purchase Date
Purchase Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody's/
S&P/
Fitch
Maturity
Duration
12572QAL9 CME GROUP INC 4.4 03/15/2030 2,000,000.00 11/13/2025

4.12%
2,021,360.00
2,020,274.13
101.39

4.03%
2,027,768.00
33,244.44

0.73%
7,493.87
Aa3/AAAA4.12

3.61 743315AW3 PROGRESSIVE CORP 3.2
03/26/2030 2,500,000.00 04/25/20254.49%
2,359,625.00
2,381,468.07

96.62 4.09%
2,415,615.00
27,777.78

0.87%
34,146.93
A2/A
A

4.15 3.79
74464AAC5 PUBLIC STORAGE OPERATING CO

4.375 07/01/2030 1,700,000.00 07/17/20254.58%
1,684,598.00
1,686,283.79
100.88

4.15%
1,714,961.70
6,197.92

0.62%
28,677.91
A2/A
NA

4.41 3.90
713448GH5 PEPSICO INC 4.3 07/23/2030 2,000,000.00 09/19/2025

4.08%
2,018,440.00
2,017,037.07
101.07

4.04%
2,021,454.00
1,911.11

0.73%
4,416.93
A1/A+
NA

4.47 3.97
58933YBQ7 MERCK & CO INC 4.15
09/15/2030 2,000,000.00 09/23/20254.07%
2,007,100.00
2,006,583.20
100.45

4.04%
2,008,900.00
32,738.89

0.72%
2,316.80
Aa3/A+
NA

4.62 4.03
02079KAW7 ALPHABET INC 4.1 11/15/2030 2,100,000.00 11/14/2025

4.04%
2,105,565.00
2,105,329.12
100.08

4.08%
2,101,688.40
20,329.17

0.75%
(3,640.72)
Aa2/AA+
NA

4.79 4.27
023135CT1 AMAZON.COM INC 4.1
11/20/2030 2,000,000.00 12/29/20254.03%
2,006,040.00
2,005,926.43
100.01

4.10%
2,000,182.00
16,172.22

0.72%
(5,744.43)
A1/AA
AA4.804.28
Total Corporate 67,755,000.00 4.40%
67,654,088.90
67,682,800.35
101.09

4.01%
68,475,146.53
709,062.36

24.57%
792,346.18

3.46 2.98

MONEY MARKET
FUND
31846V807 FIRST AMER:TRS OBG Y 1,562,640.13 --

3.31%
1,562,640.13
1,562,640.13

1.00 3.31%
1,562,640.13

0.00 0.56%

0.00 Aaa/
AAAm
AAA

0.00 0.00
Total Money
Market Fund 1,562,640.13 3.31%
1,562,640.13
1,562,640.13

1.00 3.31%
1,562,640.13

0.00 0.56%

0.00 0.00

0.00 MUNICIPAL
BONDS
13063EGT7 CALIFORNIA STATE 4.5
08/01/2029 2,715,000.00 10/30/20244.38%
2,729,308.05
2,725,561.49
102.44

3.75%
2,781,308.45
61,087.50

1.00%
55,746.95
Aa2/AAAA3.50

3.22 Total Municipal
Bonds 2,715,000.00 4.38%
2,729,308.05
2,725,561.49
102.44

3.75%
2,781,308.45
61,087.50

1.00%
55,746.95

3.50 3.22

SUPRANATIONAL
45950VPU4 INTERNATIONAL FINANCE CORP

0.75 03/23/2026 2,000,000.00 03/23/20210.81%
1,994,600.00
1,999,852.14

99.55 3.95%
1,990,964.00
5,333.33

0.71%
(8,888.14)
Aaa/AAA
NA

HOLDINGS REPORT
Cusip Security Description Par Value/
Units
Purchase Date
Purchase Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody's/
S&P/
Fitch
Maturity
Duration
45906M4E8

INTERNATIONAL BANK FOR

RECONSTRUCTION AND
DEVELOPM 4.5 06/26/2028
2,000,000.00 06/26/2023

4.53%
1,997,500.00
1,998,801.31
100.19

4.41%
2,003,762.00
8,750.00

0.72%
4,960.69
Aaa/AAA
NA

2.40 0.39
459058LN1

INTERNATIONAL BANK FOR

RECONSTRUCTION AND
DEVELOPM 3.875 10/16/2029
3,865,000.00 --

3.98%
3,846,482.35
3,851,243.89
100.57

3.71%
3,887,030.50
43,674.50

1.39%
35,786.61
Aaa/AAA
NA

3.71 3.39
459058LY7

INTERNATIONAL BANK FOR

RECONSTRUCTION AND
DEVELOPM 3.5 10/28/2030
3,500,000.00 10/27/2025

3.69%
3,469,900.00
3,471,482.48

98.64 3.82%
3,452,239.00
31,645.83

1.24%
(19,243.48)
Aaa/AAA
NA

4.74 4.28
Total
Supranational 11,365,000.00 3.43%
11,308,482.35
11,321,379.81

99.73 3.91%
11,333,995.50
89,403.67

4.07%
12,615.69

3.16 2.56

US TREASURY
91282CBW0 UNITED STATES TREASURY 0.75
04/30/2026 1,500,000.00 01/12/20221.45%
1,456,406.25
1,497,554.97

99.30 3.67%
1,489,540.50
2,890.19

0.53%
(8,014.47)
Aa1/AA+
AA+

0.24 0.24
91282CCF6 UNITED STATES TREASURY 0.75
05/31/2026 2,000,000.00 09/24/20210.88%
1,988,281.25
1,999,184.48

99.05 3.71%
1,981,016.00
2,596.15

0.71%
(18,168.48)
Aa1/AA+
AA+

0.33 0.32
91282CCP4 UNITED STATES TREASURY 0.625
07/31/2026 2,000,000.00 09/24/20210.90%
1,973,950.30
1,997,352.37

98.53 3.65%
1,970,626.00

34.53 0.71%
(26,726.37)
Aa1/AA+
AA+

0.50 0.49
91282CCW9 UNITED STATES TREASURY 0.75
08/31/2026 2,000,000.00 10/08/20211.00%
1,975,781.25
1,997,141.97

98.37 3.65%
1,967,468.00
6,381.22

0.71%
(29,673.97)
Aa1/AA+
AA+

0.58 0.56
91282CCZ2 UNITED STATES TREASURY 0.875
09/30/2026 2,000,000.00 10/08/20211.02%
1,986,406.25
1,998,197.97

98.23 3.62%
1,964,656.00
5,961.54

0.70%
(33,541.97)
Aa1/AA+
AA+

0.66 0.64
912828YU8 UNITED STATES TREASURY 1.625
11/30/2026 2,000,000.00 02/28/20221.86%
1,978,437.50
1,996,248.92

98.42 3.58%
1,968,454.00
5,625.00

0.71%
(27,794.92)
Aa1/AA+
AA+

0.83 0.81
912828YX2 UNITED STATES TREASURY 1.75
12/31/2026 2,000,000.00 03/17/20222.17%
1,961,956.00
1,992,760.77

98.39 3.57%
1,967,766.00
3,093.92

0.71%
(24,994.77)
Aa1/AA+
AA+

0.91 0.89
91282CMY4 UNITED STATES TREASURY 3.75
04/30/2027 2,000,000.00 01/27/20263.55%
2,004,687.50
2,004,646.47
100.26

3.53%
2,005,156.00
19,267.96

0.72%
509.53
Aa1/AA+
AA+

1.24 1.19
91282CFZ9 UNITED STATES TREASURY 3.875
11/30/2027 2,000,000.00 01/25/20244.10%
1,984,380.00
1,992,584.67
100.59

3.54%
2,011,796.00
13,413.46

0.72%
19,211.33
Aa1/AA+
AA+

1.83 1.74
91282CGC9 UNITED STATES TREASURY 3.875
12/31/2027 3,000,000.00 01/25/20244.08%
2,977,500.00
2,989,063.37
100.62

3.54%
3,018,516.00
10,276.24

1.08%
29,452.63
Aa1/AA+
AA+

1.91 1.82
91282CGH8 UNITED STATES TREASURY 3.5
01/31/2028 2,000,000.00 01/25/20244.08%
1,957,414.00
1,978,837.63

99.93 3.53%
1,998,672.00
193.37

0.72%
19,834.37
Aa1/AA+
AA+

HOLDINGS REPORT
Cusip Security Description Par Value/
Units
Purchase Date
Purchase Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody's/
S&P/
Fitch
Maturity
Duration
9128283W8 UNITED STATES TREASURY 2.75
02/15/2028 5,000,000.00 12/09/20244.10%
4,800,781.25
4,872,445.14

98.45 3.55%
4,922,265.00
63,519.02

1.77%
49,819.86
Aa1/AA+
AA+

2.04 1.93
91282CGP0 UNITED STATES TREASURY 4.0
02/29/2028 2,000,000.00 06/28/20234.06%
1,995,000.00
1,997,779.73
100.89

3.55%
2,017,890.00
34,033.15

0.72%
20,110.27
Aa1/AA+
AA+

2.08 1.94
91282CGT2 UNITED STATES TREASURY 3.625
03/31/2028 2,000,000.00 01/25/20244.07%
1,966,020.00
1,982,442.55
100.16

3.55%
2,003,126.00
24,697.80

0.72%
20,683.45
Aa1/AA+
AA+

2.16 2.03
91282CHA2 UNITED STATES TREASURY 3.5
04/30/2028 2,000,000.00 01/25/20244.06%
1,956,484.36
1,977,110.27

99.87 3.56%
1,997,344.00
17,983.43

0.72%
20,233.73
Aa1/AA+
AA+

2.25 2.12
91282CHE4 UNITED STATES TREASURY 3.625
05/31/2028 2,000,000.00 01/25/2024

4.07%
1,965,180.00
1,981,362.09
100.14

3.56%
2,002,734.00
12,548.08

0.72%
21,371.91
Aa1/AA+
AA+

2.33 2.20
91282CHQ7 UNITED STATES TREASURY 4.125
07/31/2028 3,000,000.00 01/25/20244.06%
3,007,950.00
3,004,392.03
101.32

3.57%
3,039,609.00
341.85

1.09%
35,216.97
Aa1/AA+
AA+

2.50 2.35
91282CHX2 UNITED STATES TREASURY 4.375
08/31/2028 2,000,000.00 02/23/20244.35%
2,002,000.00
2,001,141.13
101.93

3.58%
2,038,516.00
37,223.76

0.73%
37,374.87
Aa1/AA+
AA+

2.58 2.38
91282CJN2 UNITED STATES TREASURY 4.375
11/30/2028 2,000,000.00 02/23/20244.33%
2,003,722.00
2,002,207.13
102.05

3.60%
2,041,016.00
15,144.23

0.73%
38,808.87
Aa1/AA+
AA+

2.83 2.62
91282CDW8 UNITED STATES TREASURY 1.75
01/31/2029 5,000,000.00 10/29/20244.16%
4,535,156.25
4,672,455.66

94.75 3.62%
4,737,305.00
241.71

1.70%
64,849.34
Aa1/AA+
AA+

3.00 2.88
91282CEB3 UNITED STATES TREASURY 1.875
02/28/2029 3,000,000.00 11/12/20244.30%
2,717,226.56
2,797,477.95

94.96 3.62%
2,848,827.00
23,929.56

1.02%
51,349.05
Aa1/AA+
AA+

3.08 2.92
91282CKG5 UNITED STATES TREASURY 4.125
03/31/2029 5,000,000.00 12/09/20244.09%
5,005,664.06
5,004,157.97
101.46

3.63%
5,073,045.00
70,260.99

1.82%
68,887.03
Aa1/AA+
AA+

3.16 2.90
9128286T2 UNITED STATES TREASURY 2.375
05/15/2029 5,000,000.00 10/29/20244.14%
4,637,304.69
4,737,713.10

96.09 3.65%
4,804,690.00
25,587.02

1.72%
66,976.90
Aa1/AA+
AA+

3.28 3.10
91282CKT7 UNITED STATES TREASURY 4.5
05/31/2029 2,000,000.00 01/13/20254.59%
1,992,812.50
1,994,535.16
102.63

3.65%
2,052,656.00
15,576.92

0.74%
58,120.84
Aa1/AA+
AA+

3.33 3.05
91282CEV9 UNITED STATES TREASURY 3.25
06/30/2029 5,000,000.00 10/23/20244.07%
4,825,585.94
4,873,014.32

98.71 3.66%
4,935,350.00
14,364.64

1.77%
62,335.68
Aa1/AA+
AA+

3.41 3.19
91282CFC0 UNITED STATES TREASURY 2.625
07/31/2029 5,500,000.00 10/04/20243.79%
5,221,347.66
5,297,747.22

96.62 3.66%
5,314,160.50
398.83

1.91%
16,413.28
Aa1/AA+
AA+

3.50 3.30
91282CLK5 UNITED STATES TREASURY 3.625
08/31/2029 5,400,000.00 09/20/20243.53%
5,422,781.25
5,416,514.20

99.81 3.68%
5,389,875.00
83,274.86

1.93%
(26,639.20)
Aa1/AA+
AA+

3.58 3.27
91282CLN9 UNITED STATES TREASURY 3.5
09/30/2029 4,000,000.00 10/03/20243.61%
3,979,218.75
3,984,750.53

99.36 3.69%
3,974,532.00
47,692.31

1.43%
(10,218.53)
Aa1/AA+
AA+

3.66 3.36
91282CFT3 UNITED STATES TREASURY 4.0
10/31/2029 5,000,000.00 12/09/2024

4.08%
4,981,250.00
4,985,638.30
101.04

3.70%
5,052,150.00
51,381.22

1.81%
66,511.70
Aa1/AA+
AA+

HOLDINGS REPORT
Cusip Security Description Par Value/
Units
Purchase Date
Purchase Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody's/
S&P/
Fitch
Maturity
Duration
91282CMA6 UNITED STATES TREASURY 4.125
11/30/2029 3,000,000.00 12/04/20244.08%
3,006,210.94
3,004,768.20
101.48

3.70%
3,044,532.00
21,418.27

1.09%
39,763.80
Aa1/AA+
AA+

3.83 3.49
91282CMU2 UNITED STATES TREASURY 4.0
03/31/2030 2,500,000.00 05/22/20254.11%
2,488,378.91
2,490,043.75
101.00

3.74%
2,524,902.50
34,065.93

0.91%
34,858.75
Aa1/AA+
AA+

4.16 3.75
91282CMZ1 UNITED STATES TREASURY 3.875
04/30/2030 3,250,000.00 04/29/20253.78%
3,263,837.89
3,261,738.71
100.50

3.75%
3,266,250.00
32,354.11

1.17%
4,511.29
Aa1/AA+
AA+

4.24 3.84
91282CNG2 UNITED STATES TREASURY 4.0
05/31/2030 2,000,000.00 06/06/20254.11%
1,990,078.13
1,991,372.29
100.99

3.75%
2,019,766.00
13,846.15

0.72%
28,393.71
Aa1/AA+
AA+

4.33 3.92
91282CNN7 UNITED STATES TREASURY 3.875
07/31/2030 6,000,000.00 08/15/2025

3.85%
6,007,500.00
6,006,807.25
100.46

3.76%
6,027,654.00
642.27

2.16%
20,846.75
Aa1/AA+
AA+

4.50 4.09
91282CNX5 UNITED STATES TREASURY 3.625
08/31/2030 5,000,000.00 09/18/20253.66%
4,992,382.81
4,992,951.89

99.37 3.78%
4,968,360.00
77,106.35

1.78%
(24,591.89)
Aa1/AA+
AA+

4.58 4.11
91282CPN5 UNITED STATES TREASURY 3.5
11/30/2030 2,800,000.00 12/29/20253.68%
2,777,906.25
2,778,312.20

98.71 3.79%
2,763,905.20
16,961.54

0.99%
(14,407.00)
Aa1/AA+
AA+

4.83 4.37
Total US Treasury 111,950,000.00 3.66%
109,786,980.50
110,552,452.37

99.37 3.65%
111,204,126.70
804,327.57

39.90%
651,674.33

2.95 2.73
Total Portfolio 279,571,747.55 3.71%
276,047,408.67
277,082,442.00

99.05 3.78%
278,696,419.21
2,013,467.21
100.00%
1,613,977.21

TRANSACTION LEDGER
Transaction Type Settlement
Date CUSIP Quantity Security Description Price
Acq/
Disp
Yield
Amount Interest Pur/
Sold Total Amount Gain/Loss

ACQUISITIONS
Purchase 01/02/2026 31846V807 37,394.10 FIRST AMER:TRS OBG Y 1.000 3.40% (37,394.10) 0.00 (37,394.10) 0.00 Purchase 01/05/2026 31846V807 10,147.53 FIRST AMER:TRS OBG Y 1.000 3.35% (10,147.53) 0.00 (10,147.53) 0.00 Purchase 01/09/2026 31846V807 75,950.00 FIRST AMER:TRS OBG Y 1.000 3.31% (75,950.00) 0.00 (75,950.00) 0.00 Purchase 01/13/2026 31846V807 81,510.00 FIRST AMER:TRS OBG Y 1.000 3.31% (81,510.00) 0.00 (81,510.00) 0.00 Purchase 01/15/2026 31846V807 16,669.37 FIRST AMER:TRS OBG Y 1.000 3.31% (16,669.37) 0.00 (16,669.37) 0.00 Purchase 01/16/2026 31846V807 2,012,365.00 FIRST AMER:TRS OBG Y 1.000 3.31% (2,012,365.00) 0.00 (2,012,365.00) 0.00 Purchase 01/20/2026 31846V807 5,940.00 FIRST AMER:TRS OBG Y 1.000 3.31% (5,940.00) 0.00 (5,940.00) 0.00 Purchase 01/20/2026 31846V807 52,215.98 FIRST AMER:TRS OBG Y 1.000 3.31% (52,215.98) 0.00 (52,215.98) 0.00 Purchase 01/22/2026 06406RCG0 945,000.00

BANK OF NEW YORK
MELLON CORP 4.026
01/22/2030
100.000 4.09% (945,000.00) 0.00 (945,000.00) 0.00
Purchase 01/22/2026 06406RCG0 980,000.00

BANK OF NEW YORK
MELLON CORP 4.026
01/22/2030
100.048 4.01% (980,470.40) 0.00 (980,470.40) 0.00
Purchase 01/23/2026 31846V807 41,210.49 FIRST AMER:TRS OBG Y 1.000 3.31% (41,210.49) 0.00 (41,210.49) 0.00 Purchase 01/26/2026 31846V807 72,313.41 FIRST AMER:TRS OBG Y 1.000 3.31% (72,313.41) 0.00 (72,313.41) 0.00 Purchase 01/26/2026 31846V807 60,787.59 FIRST AMER:TRS OBG Y 1.000 3.31% (60,787.59) 0.00 (60,787.59) 0.00 Purchase 01/28/2026 95000U4D2 2,000,000.00 WELLS FARGO & CO

4.182 01/23/2030 100.019 4.17% (2,000,380.00) (1,161.67) (2,001,541.67) 0.00 Purchase 01/28/2026 693475CG8 2,000,000.00

PNC FINANCIAL

SERVICES GROUP INC

4.075 01/26/2029
100.091 4.03% (2,001,820.00) (452.78) (2,002,272.78) 0.00 Purchase 01/28/2026 91282CMY4 2,000,000.00

UNITED STATES
TREASURY 3.75
04/30/2027
100.234 3.55% (2,004,687.50) (18,439.23) (2,023,126.73) 0.00 Purchase 01/28/2026 31846V807 11,250.00 FIRST AMER:TRS OBG Y 1.000 3.31% (11,250.00) 0.00 (11,250.00) 0.00 Total Purchase 10,402,753.47 (10,410,111.37) (20,053.68) (10,430,165.05) 0.00 TOTAL
ACQUISITIONS 10,402,753.47 (10,410,111.37) (20,053.68) (10,430,165.05) 0.00

TRANSACTION LEDGER
Transaction Type Settlement
Date CUSIP Quantity Security Description Price
Acq/
Disp
Yield
Amount Interest Pur/
Sold Total Amount Gain/Loss
Maturity 01/28/2026 3130AKSV9 (3,000,000.00)

FEDERAL HOME
LOAN BANKS 0.75
01/28/2026
100.000 0.65% 3,000,000.00 0.00 3,000,000.00 0.00
Maturity 01/28/2026 3130AKQA7 (3,000,000.00) FEDERAL HOME LOAN BANKS 0.7 01/28/2026 100.000 0.61% 3,000,000.00 0.00 3,000,000.00 0.00 Total Maturity (6,000,000.00) 6,000,000.00 0.00 6,000,000.00 0.00 Sale 01/08/2026 31846V807 (10,489.59) FIRST AMER:TRS OBG Y 1.000 3.31% 10,489.59 0.00 10,489.59 0.00 Sale 01/16/2026 3130ARKG5 (2,000,000.00) FEDERAL HOME LOAN BANKS 3.0 04/21/2026 99.794 3.00% 1,995,880.00 (14,166.67) 2,010,046.67 (4,120.00) Sale 01/22/2026 31846V807 (1,925,470.40) FIRST AMER:TRS OBG Y 1.000 3.31% 1,925,470.40 0.00 1,925,470.40 0.00 Sale 01/28/2026 31846V807 (16,441.18) FIRST AMER:TRS OBG Y 1.000 3.31% 16,441.18 0.00 16,441.18 0.00 Total Sale (3,952,401.17) 3,948,281.17 (14,166.67) 3,962,447.84 (4,120.00) TOTAL
DISPOSITIONS (9,952,401.17) 9,948,281.17 (14,166.67) 9,962,447.84 (4,120.00) OTHER

TRANSACTIONS
Coupon 01/01/2026 3137FLMV3 0.00 FHMS K-090 A2 3.422
02/25/2029 4.73% 3,869.71 0.00 3,869.71 0.00
Coupon 01/01/2026 3137H9D71 0.00 FHMS K-750 A2 3.0
09/25/2029 4.62% 6,250.00 0.00 6,250.00 0.00
Coupon 01/01/2026 74464AAC5 0.00

PUBLIC STORAGE
OPERATING CO 4.375
07/01/2030

4.58% 37,394.10 0.00 37,394.10 0.00
Coupon 01/01/2026 3137FQ3Z4 0.00 FHMS K-101 A2 2.524
10/25/2029 4.42% 5,216.27 0.00 5,216.27 0.00
Coupon 01/01/2026 3137HA4B9 0.00 FHMS K-751 A2 4.412
03/25/2030 4.41% 9,191.67 0.00 9,191.67 0.00
Coupon 01/01/2026 3137FNAE0 0.00 FHMS K-095 A2 2.785
06/25/2029 4.39% 2,320.83 0.00 2,320.83 0.00
Coupon 01/01/2026 3137FPJG1 0.00 FHMS K-099 A2 2.595
09/25/2029 4.38% 6,055.00 0.00 6,055.00 0.00
City of Santa Barbara Managed | Account #11204 | As of January 31, 2026 Execution Time: 02/04/2026 02:35:07 PM Chandler Asset Management | [email protected] | www.chandlerasset.com | 800.317.4747

TRANSACTION LEDGER
Transaction Type Settlement
Date CUSIP Quantity Security Description Price
Acq/
Disp
Yield
Amount Interest Pur/
Sold Total Amount Gain/Loss
Coupon 01/01/2026 3137FRUT6 0.00 FHMS K-106 A2 2.069
01/25/2030 4.28% 4,655.25 0.00 4,655.25 0.00
Coupon 01/01/2026 3137FMTY8 0.00 FHMS K-094 A2 2.903
06/25/2029 3.87% 7,257.50 0.00 7,257.50 0.00
Coupon 01/01/2026 3137FPHK4 0.00 FHMS K-098 A2 2.425
08/25/2029 3.83% 4,243.75 0.00 4,243.75 0.00
Coupon 01/01/2026 3137FMCR1 0.00 FHMS K-093 A2 2.982
05/25/2029 3.82% 6,125.17 0.00 6,125.17 0.00
Coupon 01/01/2026 3137FLN91 0.00 FHMS K-091 A2 3.505
03/25/2029 3.80% 7,506.54 0.00 7,506.54 0.00
Coupon 01/09/2026 59217GFT1 0.00

METROPOLITAN LIFE
GLOBAL FUNDING I 4.9
01/09/2030

4.96% 75,950.00 0.00 75,950.00 0.00
Coupon 01/12/2026 61690DK72 0.00

MORGAN STANLEY
BANK NA 5.016
01/12/2029

4.93% 81,510.00 0.00 81,510.00 0.00
Coupon 01/15/2026 58768YAD7 0.00 MBALT 2025-A A3 4.61
04/16/2029 4.66% 5,205.46 0.00 5,205.46 0.00
Coupon 01/15/2026 44935XAD7 0.00 HART 2025-B A3 4.36
12/17/2029 4.36% 3,742.33 0.00 3,742.33 0.00
Coupon 01/15/2026 92970QAJ4 0.00 WFCIT 2025-1 A 4.34
05/15/2030 4.33% 7,721.58 0.00 7,721.58 0.00
Coupon 01/16/2026 362549AD9 0.00 GMCAR 2025-2 A3 4.28
04/16/2030 4.71% 2,318.33 0.00 2,318.33 0.00
Coupon 01/20/2026 362962AD4 0.00 GMALT 2025-2 A3 4.58
05/22/2028 4.84% 4,732.67 0.00 4,732.67 0.00
Coupon 01/20/2026 025816EJ4 0.00 AMERICAN EXPRESS CO

4.351 07/20/2029 4.35% 47,483.31 0.00 47,483.31 0.00
Coupon 01/20/2026 89240NAD4 0.00 TLOT 2025-B A3 3.96
11/20/2028 3.97% 5,940.00 0.00 5,940.00 0.00
Coupon 01/23/2026 713448GH5 0.00 PEPSICO INC 4.3
07/23/2030 4.08% 43,000.00 0.00 43,000.00 0.00
Coupon 01/25/2026 096912AD2 0.00 BMWLT 2025-1 A3 4.43
06/26/2028 4.82% 2,510.33 0.00 2,510.33 0.00
City of Santa Barbara Managed | Account #11204 | As of January 31, 2026 Execution Time: 02/04/2026 02:35:07 PM Chandler Asset Management | [email protected] | www.chandlerasset.com | 800.317.4747

TRANSACTION LEDGER
Transaction Type Settlement
Date CUSIP Quantity Security Description Price
Acq/
Disp
Yield
Amount Interest Pur/
Sold Total Amount Gain/Loss
Coupon 01/25/2026 05594HAD5 0.00 BMWLT 2025-2 A3 3.97
09/25/2028 4.32% 4,697.83 0.00 4,697.83 0.00
Coupon 01/26/2026 3130AQMX8 0.00

FEDERAL HOME
LOAN BANKS 2.25
01/26/2027

1.79% 33,750.00 0.00 33,750.00 0.00
Coupon 01/26/2026 3133ENLZ1 0.00

FEDERAL FARM CREDIT

BANKS FUNDING CORP

1.78 01/26/2027

1.78% 26,700.00 0.00 26,700.00 0.00
Coupon 01/28/2026 3130AKSV9 0.00

FEDERAL HOME
LOAN BANKS 0.75
01/28/2026

0.65% 11,250.00 0.00 11,250.00 0.00
Coupon 01/28/2026 3130AKQA7 0.00 FEDERAL HOME LOAN
BANKS 0.7 01/28/2026 0.61% 10,500.00 0.00 10,500.00 0.00 Coupon 01/31/2026 91282CDW8 0.00

UNITED STATES
TREASURY 1.75
01/31/2029

4.16% 43,750.00 0.00 43,750.00 0.00
Coupon 01/31/2026 91282CGH8 0.00

UNITED STATES
TREASURY 3.5
01/31/2028

4.08% 35,000.00 0.00 35,000.00 0.00
Coupon 01/31/2026 91282CHQ7 0.00

UNITED STATES
TREASURY 4.125
07/31/2028

4.06% 61,875.00 0.00 61,875.00 0.00
Coupon 01/31/2026 91282CNN7 0.00

UNITED STATES
TREASURY 3.875
07/31/2030

3.85% 116,250.00 0.00 116,250.00 0.00
Coupon 01/31/2026 91282CFC0 0.00

UNITED STATES
TREASURY 2.625
07/31/2029

3.79% 72,187.50 0.00 72,187.50 0.00
Coupon 01/31/2026 91282CCP4 0.00

UNITED STATES
TREASURY 0.625
07/31/2026

0.90% 6,250.00 0.00 6,250.00 0.00
Total Coupon 0.00 802,410.13 0.00 802,410.13 0.00
Custody Fee 01/23/2026 CCYUSD (1,789.51) Cash 0.00% (1,789.51) 0.00 (1,789.51) 0.00 Total Custody Fee (1,789.51) (1,789.51) 0.00 (1,789.51) 0.00 City of Santa Barbara Managed | Account #11204 | As of January 31, 2026 Execution Time: 02/04/2026 02:35:07 PM Chandler Asset Management | [email protected] | www.chandlerasset.com | 800.317.4747

TRANSACTION LEDGER
Transaction Type Settlement
Date CUSIP Quantity Security Description Price
Acq/
Disp
Yield
Amount Interest Pur/
Sold Total Amount Gain/Loss
Dividend 01/31/2026 31846V807 0.00 FIRST AMER:TRS OBG Y 3.26% 4,689.12 0.00 4,689.12 0.00 Total Dividend 0.00 4,689.12 0.00 4,689.12 0.00
Management Fee 01/08/2026 CCYUSD (10,489.59) Cash 0.00% (10,489.59) 0.00 (10,489.59) 0.00 Total
Management Fee (10,489.59) (10,489.59) 0.00 (10,489.59) 0.00 Principal Paydown 01/01/2026 3137FMCR1 2,751.15 FHMS K-093 A2 2.982 05/25/2029 3.82% 2,751.15 -- 2,751.15 0.00
Total Principal
Paydown 2,751.15 2,751.15 -- 2,751.15 0.00

TOTAL OTHER
TRANSACTIONS (9,527.95) 797,571.30 0.00 797,571.30 0.00 ENDING BALANCE AS OF January 31, 2026
Book
Description ValueRiver City Bank Lockbox Account 2,026,026 $ River City Bank ICS (Investment Account) 16,269,017Total Cash and Investments $ 18,295,043 January 31, 2026
ATTACHMENT 2

COMMUNITY CHOICE AGGREGATION (CCA)

CITY OF SANTA BARBARA
Summary of Cash and Investments
Activity Summary by Source
Balance on Balance on
Source 01/01/2026 Contributions Earnings Expenses Distributions Transfers 01/31/2026 PENSION $2,728,644.29 $0.00 $40,304.52 $(568.47) $0.00 $0.00 $2,768,380.34 Totals $2,728,644.29 $0.00 $40,304.52 $(568.47) $0.00 $0.00 $2,768,380.34 Investment Selection
Source Selected Investment
PENSION Moderate - Strategic Blend
Investment Objective
Selected Investment Description
Moderate - Strategic
Blend
The dual goals of the Moderate Strategic Blend Strategy are growth of principal and income. It is expected that dividend and interest income will comprise a significant portion of total return, although growth through capital appreciation is equally impor
Investment Performance
Annualized Return Inception
Source 1-Month 3-Month 1-Year 3-Years 5-Years 10-Years Date PENSION 1.48% 2.25% 12.37% - - - 01/26/2024

CITY OF SANTA BARBARA
City of Santa Barbara PARS PAPEBT
Monthly Account Report for the Period
01/01/2026 to 01/31/2026
4350 Von Karman Ave., Ste. 100, Newport Beach, CA 92660-2043 phone 800.540.6369 fax 949.250.1250 www.pars.org

CITY OF SANTA BARBARA

COUNCIL AGENDA REPORT
AGENDA DATE: February 24, 2026
TO: Mayor and Councilmembers
FROM: City Administrator’s Office
SUBJECT: HOME Tenant-Based Rental Assistance Grant Amendments [Agreement]
RECOMMENDATION: That Council:

EXECUTIVE SUMMARY:

In addition to allowing property acquisition, new construction, and rehabilitation, the Federal HOME program authorizes participating jurisdictions to create flexible programs that provide rental assistance to low-income households enabling them to rent market-rate units. These Agenda Item No. 5
Council Agenda Report
HOME Tenant-Based Rental Assistance Grant Amendments [Agreement] February 24, 2026

Page 2 ends

programs are known as Tenant-Based Rental Assistance, or TBRA. The City of Santa Barbara has been utilizing a portion of its annual HOME entitlement award to fund TBRA programs since 2012.

The City last awarded TBRA funds in 2024 to New Beginnings, Transition House, and the Housing Authority of the City of Santa Barbara. These funds are nearly depleted, and all three organizations submitted written requests for additional HOME funds for continued operation of their TBRA programs. As discussed below, all three applicants are recommended for additional funding.

DISCUSSION:

HOME TBRA Programs
HOME TBRA Programs operate similarly to the Section 8 Program. TBRA grants may facilitate up to 24 months of rental housing assistance (including security and utility deposits) to low-income households, including unhoused persons and those at imminent risk of becoming homeless. Participants’ incomes can be no more than 60 percent of the Area Median Income (AMI), as determined by HUD, adjusted for household size. For example, to qualify for TBRA assistance, the maximum annual income limit for a family of four would currently be $105,900.

Tenant-Based Rental Assistance is provided through the issuance of a housing voucher from the program administrator (the subrecipient organization) to the tenant. Once a unit is identified, the program administrator inspects the unit to ensure it meets federal Housing Quality Standards. The program administrator reviews the monthly rent amount to ensure it is appropriate given the unit’s size, location, and condition. Administrators also review the lease to ensure that it does not contain terms prohibited by HUD. Once these requirements are met, the owner and tenant execute a lease.

Rent is paid directly to the owner from two sources: 1) the portion paid by the tenant (tenant share), which equals 30 percent of household income; and 2) the portion paid by the TBRA administrator (rental subsidy), which covers the difference between the rent and the tenant share. TBRA-subsidized units are inspected annually to ensure that they continue to meet Housing Quality Standards, and household income is also reviewed annually to ensure that households are still eligible.

Each proposed program described below conforms to guidelines established by HUD for administering TBRA programs and satisfies the housing needs and priorities established in the City’s Five-Year Consolidated Plan for use of federal funds, including HOME.

The following is a description of the organizations recommended for HOME TBRA funds.

The number of assisted households anticipated to be served by each organization are estimates only, as they depend on various factors such as individual household income, rent amounts, and length of assistance necessary.

Council Agenda Report
HOME Tenant-Based Rental Assistance Grant Amendments [Agreement] February 24, 2026

Page 3 ends

New Beginnings
New Beginnings will utilize TBRA funding for rapid rehousing under its Safe Parking Program and its Veterans Administration–accredited Supportive Services for Veteran Families (SSVF) Program. The population to be served includes homeless individuals, vehicular homeless, and homeless veterans.

The Safe Parking Program is a nationally recognized model, which provides safe overnight parking shelter to people living in their vehicles.1 Services include rapid rehousing, case management, and temporary financial assistance to move people into secure housing and employment. The program also provides job training and crisis intervention.

New Beginnings has been a recipient of City TBRA funds since 2017. Funds under the current grant that Council approved in 2024 have provided housing to 59 unduplicated households, including one-time security deposit assistance. The available funds provided under this agreement have nearly been depleted, and the agency will not be able to continue assistance without an infusion of additional funds. New Beginnings requested $350,000 in HOME TBRA funds to continue housing at least 13 existing households. Due to the limited amount of HOME funds available staff is only able to recommend a portion of their request – an allocation of $234,313 to New Beginnings to support TBRA assistance. If approved, this agreement will remain in effect until December 31, 2026. Case management will be provided to all clients and paid for through other funding sources.

Transition House
Transition House’s rapid rehousing program moves homeless families with children into permanent rental housing while providing ongoing case management aimed at housing stabilization. Case management is provided for a minimum of six months up to 24 months and includes employment assistance, landlord engagement, medical and mental health support, among other services.

Transition House has been a recipient of City TBRA funds since 2012. Funds under the current grant that Council approved in 2024 have provided housing to 14 family households.

If approved, this agreement will be in effect until December 31, 2026. Case management will be funded through Transition House’s other funding sources. Transition House requested $157,000 to provide housing assistance for up to 17 households. Based on available funding, staff recommends an allocation of $100,000 to Transition House to support TBRA assistance.
1 The 2025 Santa Barbara County Point in Time Count showed that 65 percent of the countywide unsheltered population lives in their vehicles – this has been the fastest growing population in recent years and exceeds the number of persons sleeping in traditional shelters.

Council Agenda Report
HOME Tenant-Based Rental Assistance Grant Amendments [Agreement] February 24, 2026

Page 4 ends

Housing Authority of the City of Santa Barbara
The Housing Authority has an established track record of providing affordable rental assistance in the community for more than 50 years. The Housing Authority has been a recipient of City TBRA funds since Fiscal Year 2012. Funds under the current grant that Council approved in 2024 have provided housing to 14 households.

The Housing Authority TBRA program provides rental assistance vouchers and security deposit assistance to those on Housing Authority’s Section 8 waiting list, including chronically homeless individuals and families, veterans, elderly and disabled individuals.

Case management is provided to TBRA participants through its Supportive Services program, which offers individualized support to any Housing Authority client in need, including individuals and families with a history of homelessness.

Funds under the current grant that Council approved in 2024 have been depleted. Adding to the challenge is that Emergency Housing Vouchers (EHV) authorized by the American Rescue Plan Act of 2021 have been discontinued by the current administration. As such, the Housing Authority is working to identify alternative funding sources to prevent households from losing their housing. If approved, this agreement remains in effect until December 31, 2026. The Housing Authority has requested $550,000; however due to the limited amount of HOME funds available and the high need among all TBRA subrecipients, staff is only able to recommend a portion of this request. Staff recommends an allocation of $234,313 to the Housing Authority to support TBRA assistance.

New HUD Policy Requirements
The U.S. Department of Housing and Urban Development (HUD) has incorporated into its Program Year 2025 grant agreements with local jurisdictions Addendum 1 – Policy Requirements, issued pursuant to Executive Orders 14168, 14182, 14154, 14218, and related federal statutes and regulations. The provisions are binding on all applicable recipients and subrecipients of funds administered by HUD, including CDBG and HOME funds. The subrecipients receiving additional HOME funds have been made aware of the new requirements to ensure each organization has the capacity to meet the additional requirements.

BUDGET/FINANCIAL IMPACT:

There are sufficient appropriations in the HOME fund budget to support the recommended contracts. These grants will exhaust the amount of HOME funds allotted for TBRA activities during Program Year 2025 of the City’s 5-year Consolidated Plan. Staff will reevaluate the amount of funds that can be set aside for TBRA once new allocations are announced during the development of the City’s Program Year 2026 Annual Action Plan.

Copies of the contracts/agreements are available for public review by contacting Liz Stotts at [email protected].

Council Agenda Report
HOME Tenant-Based Rental Assistance Grant Amendments [Agreement] February 24, 2026

Page 5 ends

PREPARED BY: Liz Stotts, Administrative Analyst II
SUBMITTED BY: Anthony E. Valdez, Deputy City Administrator APPROVED BY: Kelly McAdoo, City Administrator

CITY OF SANTA BARBARA

COUNCIL AGENDA REPORT
AGENDA DATE: February 24, 2026
TO: Mayor and Councilmembers
FROM: Parks and Recreation Department
SUBJECT: Professional Services Agreement with Kruger Bensen Ziemer Architects, Inc. for the Carrillo Gymnasium Renewal Project [Agreement]
RECOMMENDATION:

That Council authorize the Parks and Recreation Director to execute a Professional Services Agreement with Kruger Bensen Ziemer Architects, Inc. to provide architectural and engineering design services for the Carrillo Gymnasium Renewal Project in the amount not to exceed $267,300.

DISCUSSION:

Background
The Carrillo Gymnasium (Gymnasium), designed by architect Julia Morgan, was constructed in 1926 and had its grand opening in February 1927. Both the Gymnasium and the adjacent Carrillo Recreation Center were designated City Landmarks in 1993.

With its roof top court, interior basketball court, restrooms, shower/locker and gym facilities, the Gymnasium has served a wide spectrum of community residents for almost 100 years. Over the years, the interior was altered to provide office space and storage, increase accessibility, upgrade restrooms, and provide gym workout space.

Exterior Renovation Project
After four years of planning, permitting and construction, renovation of the building’s exterior was completed in 2025. The renovation included replacing and waterproofing the gymnasium’s roof, restoring the roof top court, repairing the exterior stucco and decorative columns, replacing damaged windows and doors, and exterior painting. In January 2026, in recognition of the thoughtful restoration of the historic building, the City received the George and Vivian Obern Preservation Stewardship Award from the Santa Barbara Trust for Historic Preservation.

Agenda Item No. 6
Council Agenda Report
Professional Services Agreement with Kruger Bensen Ziemer Architects, Inc. for the Carrillo Gymnasium Renewal Project [Agreement]
Fenruary 24, 2026

Page 2 ends

Project Description and Schedule
With the exterior renovation complete, the Parks and Recreation Department proposes to advance design of interior renovations to provide building electrical and heating system upgrades, increase accessibility, improve lighting, modernize restroom facilities, redesign storage spaces, enhance second floor space to support greater community use, and complete limited seismic retrofitting. With a start date of late February, it is anticipated that the project design will be complete in September 2026.

Consultant Selection
The Parks and Recreation and Public Works Departments selected Kruger Bensen Ziemer Architects, Inc. (KBZ Architects) to provide architectural and engineering design services for the interior renovation project. Staff recommend that Council approves the selection of KBZ Architects given their successful work experience with the City providing design and engineering services for three historic City properties, including the Carrillo Recreation Center, Fire Station 1, and the Cabrillo Pavilion, and ability to effectively execute the Project.

BUDGET/FINANCIAL INFORMATION:

The total cost of the design contract is $267,300. Funds for this agreement are appropriated in the Fiscal Year 2026 Measure C Capital Improvement Program.

SUSTAINABILITY IMPACT:

Renovation of the Carrillo Gymnasium will modernize building systems to achieve greater energy efficiency, integration of green building components, and use of recycled materials where feasible.

A copy of the contract/agreement may be requested from the Parks and Recreation Department for public review by emailing [email protected].

PREPARED AND
SUBMITTED BY: Jill Zachary, Parks and Recreation Director APPROVED BY: Kelly McAdoo, City Administrator

CITY OF SANTA BARBARA

COUNCIL AGENDA REPORT
AGENDA DATE: February 24, 2026
TO: Mayor and Councilmembers
FROM: Finance Department and Human Resources Department SUBJECT: Fiscal Year 2026 Second-Quarter Review [Resolution] RECOMMENDATION: That Council:

A. Receive a report from staff on the status of revenues and expenditures in relation to budget for the six months ended December 31, 2025;
B. Accept the Fiscal Year (FY) 2026 Interim Financial Statements for the six months ended December 31, 2025;
C. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Resolution No. 25-129 to Approve Proposed Second Quarter (Q2) Adjustments to FY2026 Revenue and Expenditure Appropriations as Detailed in the Attached Schedule of Proposed Q2 Adjustments;
D. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Position Salary Control Resolution No. 25-138 for Authorized Positions for Fiscal Year 2026. Changes are Effective January 10, 2026; E. Hear a report from staff regarding revenue generating and expenditure control options to balance the General Fund budget in FY2026 and forecast for FY2027; and
F. Hear a report from staff related to the development of the Mid-Cycle budget update for FY2027.

EXECUTIVE SUMMARY:

Page 2 ends

to balance the budget. In order to address this additional financial pressure, staff worked to develop a comprehensive set of revenue generating and expenditure reduction/control options for the Finance Committee to consider. More than 200 individual ideas were generated and evaluated to determine potential service delivery impacts and revenue generating and cost savings ranges, among others. The Finance Committee provided their recommendations on October 21, 2025, and the City Council provided their direction on December 2, 2025.

DISCUSSION:

Q2 adjustments are also not represented in the tables below. Revenues from taxes are

45.0% of budget or $80.0 Million.

Page 3 ends

Measure C
FY2026
Adopted Budget
FY2026
Revised Budget
Actual
FY 2026 – Q2
FY2026
Projections
Actual % of
Revised Budget
Revenues $34,235,000 $34,235,000 $16,160,754 $34,235,000 47.2% Expenditures $35,119,802 $78,405,849 $13,662,082 $78,405,849 17.4% Surplus (Deficit) $(884,802) $(44,170,849) $2,498,672 $(44,170,849) The voters approved a half-cent transaction and use tax on November 5, 2024, which became effective on April 1, 2025, with the first payment to be received at Q4. Measure I tax revenue is projected to generate approximately $15.1 Million annually beginning in FY2026.

At the end of this second quarter, staff received $5.0 Million of revenue.

Below the City Council will find an update regarding the budgetary savings staff are projecting for FY2026 and FY2027 and explanations below the table.

Council Agenda Report
Fiscal Year 2026 Second-Quarter Review [Resolution]
February 24, 2026

Page 4 ends

DEPARTMENT FY2026 FY2027
City Administrator’s Office $0 $230,000
Community Development $0 $0
Finance $105,600 $3,487,300
Fire $40,000 $142,900
Human Resources $0 $0
Information Technology $0 $227,373
Library $224,186 $67,509
Parks & Recreation $0 $91,248
Police $557,000 $1,480,000
Public Works $37,500 $402,500
Sustainability & Resilience $365,000 $698,000
Total $1,329,286 $6,826,830
Impacts in FY2026 include items such as:
 Transferring positions to Enterprise Funds
 Minor fee adjustments
 Library reorganization
 Increase parking citation revenues
 Hold positions vacant
 Clean Community taking on General Fund expenses
Impacts in FY2027 include items such as:
 Transferring positions to Enterprise Funds
 Minor fee adjustments
 Library reorganization
 Increase parking citation revenues
 Hold positions vacant
 Clean Community taking on General Fund expenses
Position Changes Summary
Human Resources seeks Council approval for the following adjustments to the Position Salary Control Resolution No. 25-138, effective January 10, 2026, as detailed in Attachment 4.

Council Agenda Report
Fiscal Year 2026 Second-Quarter Review [Resolution]
February 24, 2026

Page 5 ends

FIRE DEPARTMENT: The Fire Department requests the creation of an Emergency Medical Services Manager (Job Class 0353) classification. Following a survey of similarly situated positions in other jurisdictions, the salary range will be established at $137,834 to $167,477, to ensure a competitive rate to recruit qualified candidates. Emergency Medical Services (EMS) represent the largest and most complex service delivery component of the Fire Department, accounting for the majority of emergency calls, patient contacts, regulatory oversight, and operational risk. The creation of an Emergency Medical Services Manager classification is needed to ensure consistent clinical oversight, regulatory compliance, fiscal accountability, and continuous quality improvement across the Department’s EMS system. The position will be funded with existing salary savings within the department.

Implement Salary Adjustments Due to Compaction for Certain Positions in the Santa Barbara Supervisor’s Unit: Pursuant to the 2022-2026 Supervisor’s Association Memorandum of Understanding (MOU), the City agreed to review Supervisory Classification salaries to ensure a minimum fifteen percent (15.0%) differential above the Council Agenda Report
Fiscal Year 2026 Second-Quarter Review [Resolution]
February 24, 2026

Page 6 ends

highest paid subordinate classification. The following salary adjustments are needed to ensure the City is in compliance with the MOU and avoid compaction between a supervisor and the subordinate classification.

The salary adjustments will be applied retroactively on the dates listed in the table below.

The budget impact for these salary adjustments in Fiscal Year 2026 is approximately $84,577.

Council Agenda Report
Fiscal Year 2026 Second-Quarter Review [Resolution]
February 24, 2026

Page 7 ends

The salary adjustments will be applied retroactively on the dates listed in the table below.

The budget impact for these salary adjustments in Fiscal Year 2026 is approximately $117,221.

Since FY2026 began on July 1, 2025, the City negotiated with many collective bargaining units, including the Police Officers Association (POA), Fire Association (FA), Police Council Agenda Report
Fiscal Year 2026 Second-Quarter Review [Resolution]
February 24, 2026

Page 8 ends

Managers Association (PMA) and Fire Managers Association (FMA), all of which are entirely funded by the General Fund. The salary increases assumptions built into the FY2026 and FY2027 budget were 5.0% and 4.0%, respectively. The cost of all recent public safety agreements exceeds the assumptions in the FY2026 and FY2027 budget, which will result in increased deficits. In preparation for the Q1 FY2026 report, staff will incorporate these additional costs into the FY2026 projection.

SUSTAINABILITY IMPACT:

Budget and financial reports can be accessed by the public on the City’s Budget and Reporting webpage at SantaBarbaraCA.gov/Budget-Reports. Reports are no longer printed, saving paper and toner.

ATTACHMENTS: 1. Summary by Fund Statement of Revenues and Expenditures for the Six Months Ended December 31, 2025

2. Interim Financial Statements for the Six Months Ended December 31, 2025 (Narrative Analysis)

3. Schedule of Proposed Second-Quarter Adjustments

4. Position Salary Control Revised, Effective January 10, 2026 PREPARED BY: Nathalie Lecolley, Controller
SUBMITTED BY: Keith DeMartini, Finance Director
APPROVED BY: Kelly McAdoo, City Administrator
ATTACHMENT 1
Remaining
Adopted Revised YTD Encum- Balance with %of Previous
Budget Budget Actual brances Revised budget Budget YTD
GENERAL FUND (pages 3-7)
Revenue 208,664,394 209,299,372 95,597,175 - 113,702,197 45.7% 101,274,774 Expenditures 210,270,440 218,834,272 104,870,706 7,016,671 106,946,896 51.1% 109,397,733 Addition to / (use of) reserves (9,534,901) (1,606,046) (9,273,531) (7,016,671) 6,755,301 (8,122,959) MEASURE C (pages 3-7)
Included in GF summary
Revenue 34,235,000 34,235,000 16,160,754 - 18,074,246 47.2% 16,041,047 Expenditures 35,119,802 78,405,849 13,662,082 - 64,743,767 17.4% 16,020,546 Addition to / (use of) reserves (44,170,849) (884,802) 2,498,672 - (46,669,521) 20,501 SOLID WASTE FUND (page 9)
Revenue 42,990,702 43,199,200 21,596,093 - 21,603,107 50.0% 20,051,014 Expenditures 42,373,212 42,889,098 18,179,450 11,665,717 13,043,932 69.6% 14,967,713 Addition to / (use of) reserves 310,102 617,491 3,416,643 (11,665,717) 8,559,176 5,083,301 WATER OPERATING FUND (page 10)
Revenue 86,755,946 86,755,946 46,665,999 - 40,089,947 53.8% 42,467,160 Expenditures 89,330,512 92,452,483 40,156,871 6,197,308 46,098,305 50.1% 37,107,158 Addition to / (use of) reserves (5,696,537) (2,574,566) 6,509,128 (6,197,308) (6,008,357) 5,360,002 WASTEWATER OPERATING FUND (page 11)
Revenue 34,492,415 34,492,415 17,440,968 - 17,051,447 50.6% 16,202,327 Expenditures 37,164,550 38,506,072 15,308,424 2,472,459 20,725,188 46.2% 13,901,930 Addition to / (use of) reserves (4,013,657) (2,672,135) 2,132,544 (2,472,459) (3,673,742) 2,300,397 DOWNTOWN PARKING FUND (page 12)
Revenue 10,239,915 10,292,475 5,176,602 - 5,115,873 50.3% 5,571,993 Expenditures 10,292,863 10,448,546 4,907,489 453,381 5,087,676 51.3% 5,593,206 Addition to / (use of) reserves (156,071) (52,948) 269,113 (453,381) 28,197 (21,214) AIRPORT OPERATING FUND (page 13)
Revenue 35,563,735 35,639,385 17,064,432 - 18,574,953 47.9% 16,053,787 Expenditures 41,945,246 44,271,253 19,327,679 3,838,127 21,105,447 52.3% 16,747,830 Addition to / (use of) reserves (8,631,868) (6,381,511) (2,263,247) (3,838,127) (2,530,494) (694,043) GOLF COURSE FUND (page 14)
Revenue 5,267,832 5,267,832 2,586,147 - 2,681,685 49.1% 2,511,788 Expenditures 5,741,937 5,744,110 2,544,246 - 3,199,864 44.3% 1,939,298 Addition to / (use of) reserves (476,278) (474,105) 41,901 - (518,178) 572,490 FACILITIES MANAGEMENT FUND (page 15)
Revenue 8,285,099 8,285,099 4,100,106 - 4,184,992 49.5% 3,484,798 Expenditures 7,844,685 8,024,773 3,547,221 658,599 3,818,953 52.4% 3,039,494 Addition to / (use of) reserves 260,325 440,414 552,885 (658,599) 366,039 445,305

CITY OF SANTA BARBARA
Interim Statement of Revenues and Expenditures
Summary by Fund
For Six Months Ended December 31, 2025 (50.0% of Fiscal Year)

Page 1 ends

Remaining
Adopted Revised YTD Encum- Balance with %of Previous
Budget Budget Actual brances Revised budget Budget YTD

CITY OF SANTA BARBARA
Interim Statement of Revenues and Expenditures
Summary by Fund
For Six Months Ended December 31, 2025 (50.0% of Fiscal Year) FLEET REPLACEMENT FUND (page 16)
Revenue 7,517,447 7,550,586 4,041,848 - 3,508,738 53.5% 3,490,101 Expenditures 5,225,193 10,476,607 1,366,195 924,673 8,185,739 21.9% 1,356,037 Addition to / (use of) reserves (2,926,021) 2,292,254 2,675,653 (924,673) (4,677,001) 2,134,064 FLEET MAINTENANCE FUND (page 17)
Revenue 4,174,813 4,176,813 2,089,375 - 2,087,438 50.0% 1,753,099 Expenditures 4,023,444 4,039,468 1,890,079 305,598 1,843,791 54.4% 1,809,343 Addition to / (use of) reserves 137,344 151,369 199,296 (305,598) 243,647 (56,243) SELF INSURANCE TRUST FUND (page 18)
Revenue 25,414,322 25,414,322 12,846,886 - 12,567,436 50.5% 10,171,477 Expenditures 24,784,085 24,999,880 10,698,629 611,645 13,689,607 45.2% 8,395,554 Addition to / (use of) reserves 414,442 630,237 2,148,257 (611,645) (1,122,171) 1,775,923 INFORMATION TECHNOLOGY FUND (page 19)
Revenue 10,602,324 10,602,327 5,276,776 - 5,325,550 49.8% 4,713,687 Expenditures 9,936,222 10,073,494 5,736,894 184,703 4,151,897 58.8% 5,162,722 Addition to / (use of) reserves 528,833 666,102 (460,118) (184,703) 1,173,653 (449,035) WATERFRONT OPERATING FUND (page 20)
Revenue 20,788,855 20,788,855 10,777,608 - 10,011,247 51.8% 10,756,522 Expenditures 22,732,468 22,941,467 11,041,498 1,263,704 10,636,265 53.6% 10,349,882 Addition to / (use of) reserves (2,152,612) (1,943,613) (263,890) (1,263,704) (625,017) 406,640 SANTA BARBARA CLEAN ENERGY FUND (page 21)
Revenue 47,843,217 47,843,217 18,802,930 - 29,040,287 39.3% 20,225,151 Expenditures 50,573,418 52,623,178 21,288,776 2,929,867 28,404,535 46.0% 22,753,575 Addition to / (use of) reserves (4,779,960) (2,730,201) (2,485,845) (2,929,867) 635,752 (2,528,424) ENERGY AND CLIMATE MANAGEMENT FUND (page 22)
Revenue 2,288,786 2,288,786 1,132,081 - 1,156,705 49.5% 1,108,980 Expenditures 2,313,378 2,705,342 856,839 84,565 1,763,939 34.8% 904,248 Addition to / (use of) reserves (416,556) (24,592) 275,242 (84,565) (607,233) 204,731

TOTAL FOR ALL FUNDS
Revenue 550,889,802 551,896,629 265,195,026 - 286,701,603 48.1% 259,836,658 Expenditures 564,551,652 589,030,044 261,720,995 38,607,015 288,702,034 51.0% 253,425,723 Addition to / (use of) reserves (37,133,415) (13,661,850) 3,474,031 (38,607,015) (2,000,430) 6,410,935 ** It is City policy to adopt a balanced budget. In most cases, encumbrance balances exist at year-end. These encumbrance balances are obligations of each fund and must be reported at the beginning of each fiscal year. In addition, a corresponding appropriations entry must be made in order to accommodate the 'carried-over' encumbrance amount. Most differences between budgeted annual revenues and expenses are due to these encumbrance carryovers.

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Remaining
Adopted Revised YTD Balance with Percent Previous Change Over Budget Budget Actual Revised budget Received YTD Prior Year TAXES
Sales and Use 31,960,000 31,960,000 14,734,658 17,225,342 46.1% 15,185,312 -3.0% Measure C Sales Tax 34,235,000 34,235,000 16,160,754 18,074,246 47.2% 16,041,047 0.7% Measure I Sales Tax 15,100,000 15,100,000 5,042,100 10,057,900 33.4% - 0.0% Property Taxes 53,581,500 53,581,500 20,941,167 32,640,333 39.1% 20,049,973 0.0% Utility Users Tax 8,200,000 8,200,000 4,086,974 4,113,026 49.8% 4,344,451 -5.9% Transient Occupancy Tax 29,561,000 29,561,000 17,578,913 11,982,087 59.5% 17,225,187 2.1% Business License 2,958,000 2,958,000 466,985 2,491,015 15.8% 654,914 -28.7% Cannabis Excise Tax 1,000,000 1,000,000 593,010 406,990 59.3% 550,225 7.8% Real Property Transfer Tax 1,000,000 1,000,000 476,252 523,748 47.6% 346,954 37.3% Total Tax Revenues 177,595,500 177,595,500 80,080,813 97,514,687 45.1% 74,398,062 7.6%

LICENSES & PERMITS
Licenses & Permits 239,725 239,725 72,310 167,415 30.2% 78,630 -8.0% Total 239,725 239,725 72,310 167,415 30.2% 78,630 -8.0%

FINES & FORFEITURES
Police 2,900,252 2,900,252 1,873,863 1,026,389 64.6% 1,046,139 79.1% Other Fines & Forfeitures 505,400 505,400 252,020 253,380 49.9% 570,634 -55.8% Total 3,405,652 3,405,652 2,125,883 1,279,769 62.4% 1,616,774 31.5%

USE OF MONEY & PROPERTY
Investment Income 2,497,391 2,497,391 996,761 1,500,630 39.9% 654,352 52.3% Rents & Concessions 1,615,325 1,615,325 770,178 845,147 47.7% 673,772 14.3% Total 4,112,716 4,112,716 1,766,938 2,345,777 43.0% 1,328,125 33.0%

INTERGOVERNMENTAL
Library 919,983 919,983 37,402 882,582 4.1% 45,601 0.0% Fire 1,500,000 1,500,000 430,790 1,069,210 28.7% 702,345 0.0% Other Intergovernmental 497,078 497,078 490,658 6,420 98.7% 205,509 138.8% Total 2,917,061 2,917,061 958,849 1,958,212 32.9% 953,455 0.6%

FEES & SERVICE CHARGES
Community Development 7,762,650 7,822,650 4,569,950 3,252,700 58.4% 3,984,144 14.7% Parks & Recreation 4,869,967 4,906,967 2,811,830 2,095,137 57.3% 2,493,750 12.8% Other Service Charges 3,262,558 3,782,479 1,602,695 2,179,784 42.4% 1,587,154 1.0% Total 16,512,096 15,895,175 8,984,475 7,527,621 54.4% 8,065,048 11.4%

OTHER REVENUES
Interfund Charges & Reimbursement 17,339,859 17,339,859 7,938,585 9,401,274 45.8% 6,934,927 14.5% Overhead Indirect Allocations 12,953,367 12,921,424 6,440,618 6,480,806 49.8% 4,773,886 34.9% Interfund Transfers 637,407 587,407 421,478 165,929 71.8% 319,833 31.8% Interfund Loans 24,140 24,140 - 24,140 0.0% - 0.0%
Miscellaneous 1,201,292 1,301,292 129,639 1,171,653 10.0% 63,210 105.1% Donations 77,500 77,500 32,081 45,419 41.4% 32,519 -1.3% Franchise Fees 6,500,000 6,500,000 2,806,259 3,693,741 43.2% 2,710,306 3.5% Total 38,751,622 38,733,565 17,768,661 20,982,962 45.9% 14,834,680 19.8% Subtotal Non-Tax Revenues 65,938,872 65,303,894 31,677,116 34,261,756 48.0% 26,876,711 17.9% TOTAL REVENUES 243,534,372 242,899,394 111,757,929 131,776,443 45.9% 101,274,774 10.4%

CITY OF SANTA BARBARA
General Fund
Interim Statement of Budgeted and Actual Revenues
For Six Months Ended December 31, 2025 (50.0% of Fiscal Year)

Page 3 ends

YTD
Remaining Expended
Adopted Revised YTD Encum- Balance with and Previous
Budget Budget Actual brances Revised budget Encumbered YTD

GENERAL GOVERNMENT
Mayor & City Council
MAYOR & CITY COUNCIL 1,358,463 1,356,249 597,285 1,728 759,450 44.1% 596,256 ARTS & COMMUNITY PROMOTIONS 2,021,798 2,000,318 900,610 594,611 526,577 74.0% 1,258,766 Total 3,380,261 3,356,567 1,497,894 596,340 1,286,027 62.0% 1,855,022 City Attorney
CITY ATTORNEY-ADMINISTRATION 5,731,728 5,612,505 2,693,083 348,964 2,689,680 53.1% 625,741 CITY ATTORNEY-ADVISORY 16,000 - 15 16,000 (15) 100.1% 703,619 CITY ATTORNEY-CODE ENFORCEMENT - - (581) - 581 0.0% 468,467 Total 5,747,728 5,612,505 2,692,517 364,964 2,690,246 53.2% 2,596,687 Administration
CITY ADMINISTRATOR 3,431,498 3,268,068 1,586,841 158,298 1,686,358 50.9% 1,333,825 EMPLOYEE RELATIONS 83 - 41.35 - 41 50.0% -
CITY TV 701,500 620,913 267,861 15,003 418,636 40.3% 264,557 DOWNTOWN PROGRAM 1,870,507 1,870,507 705,611 601,006 563,889 69.9% - HUMAN SVCS. 1,414,826 461,532 250,889 951,234 212,703 85.0% - HOUSING MEDIATION 548,306 547,928 255,707 222 292,376 46.7% - COMMUNITY VITALITY 850,723 850,162 209,421 296 641,005 24.7% - CITY CLERK 1,000,982 974,650 464,101 24,503 512,379 48.8% 392,607 Total 9,818,423 8,593,758 3,740,473 1,750,563 4,327,387 55.9% 1,990,989 Human Resources
HUMAN RESOURCES 2,506,311 2,455,968 1,053,336 73,092 1,379,883 44.9% 1,158,944 EMPLOYEE RELATIONS 494,135 384,894 195,568 90,896 207,671 58.0% 144,496 EMPLOYEE DEVELOPMENT 98,068 94,447 28,037 6,193 63,838 34.9% 39,443 Total 3,098,514 2,935,310 1,276,941 170,181 1,651,392 46.7% 1,342,882 Finance
ADMINISTRATION 440,384 342,626 188,055 91,646 160,683 63.5% 200,068 REVENUE & CASH MANAGEMENT 1,243,646 949,533 436,469 199,004 608,173 51.1% 348,647 CASHIERING & COLLECTION 1,872,193 1,684,907 628,018 183,530 1,060,645 43.3% 637,274 BUDGET MANAGEMENT 1,293,928 1,067,783 632,551 16,500 644,876 50.2% 598,200 ACCOUNTING 1,247,640 1,245,821 573,552 60,519 613,570 50.8% 546,434 MISCELLANEOUS 520,917 519,768 251,366 - 269,550 48.3% 243,217 ACCOUNTS PAYABLE 324,925 311,736 180,505 12,450 131,970 59.4% 179,328 CITY BILLING & CUSTOMER SERVICE 1,080,161 928,460 458,770 97,238 524,153 51.5% 239,788 PURCHASING 860,454 858,216 434,312 - 426,142 50.5% 376,963 CENTRAL WAREHOUSE 222,407 220,475 110,756 - 111,651 49.8% 102,323 MAIL SERVICES 190,819 185,000 87,079 15,499 88,240 53.8% 82,213 Total 9,297,475 8,314,325 3,981,433 676,387 4,639,654 50.1% 3,554,453 TOTAL GENERAL GOVERNMENT 31,342,401 28,812,465 13,189,259 3,558,436 14,594,706 53.4% 11,340,033 General Fund
Interim Statement of Appropriations, Expenditures and Encumbrances For Six Months Ended December 31, 2025 (50.0% of Fiscal Year)

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YTD
Remaining Expended
Adopted Revised YTD Encum- Balance with and Previous
Budget Budget Actual brances Revised budget Encumbered YTD General Fund
Interim Statement of Appropriations, Expenditures and Encumbrances For Six Months Ended December 31, 2025 (50.0% of Fiscal Year)

PUBLIC SAFETY
Police
CHIEF'S STAFF 2,741,936 2,711,702 1,882,045 117,451 742,441 72.9% 1,647,430 BUSINESS OFFICE 1,087,284 1,080,247 534,698 - 552,586 49.2% 467,485 RECORDS BUREAU 2,394,342 2,354,721 1,143,833 3,088 1,247,420 47.9% 1,069,667 STRATEGIC OPERATIONS 2,811,642 2,786,798 1,433,933 16,736 1,360,973 51.6% 1,274,395 PROPERTY ROOM 327,481 325,300 166,693 - 160,788 50.9% 125,533 TRAINING, RECRUITMENT/WELLNESS 3,981,067 3,898,322 1,651,974 99,895 2,229,198 44.0% 1,486,917 RANGE AND EQUIPMENT 2,169,291 2,103,076 998,706 67,721 1,102,864 49.2% 838,331 INF.TECHNOLOGY/CRIME ANALYSIS 2,131,461 2,074,900 1,430,836 77,993 622,632 70.8% 1,408,077 CRIMINAL INVESTIGATIONS & INTERNAL OP'S 7,133,433 7,046,070 3,658,162 59,955 3,415,316 52.1% 3,222,067 CRIME LAB 200,990 199,614 92,524 - 108,466 46.0% 88,617 FIELD OPERATIONS DIVISION 25,513,384 25,304,759 12,147,017 38,700 13,327,667 47.8% 11,621,391 TRAFFIC 1,415,159 1,406,459 843,733 - 571,426 59.6% 604,869 SPECIAL EVENTS 711,399 676,025 211,957 75,196 424,246 40.4% 220,343 STREET CRIMES UNIT 2,663,617 2,203,889 1,315,913 - 1,347,704 49.4% 1,138,146 SPECIAL ENFORCEMENT TEAM 108,194 108,194 - - 108,194 0.0% 28,070 PARKING AND STREET SWEEPING 409,637 406,848 168,615 - 241,022 41.2% 158,791 PARKING ENFORCEMENT 1,205,747 1,186,147 574,445 4,026 627,276 48.0% 457,122 COMBINED COMMUNICATIONS CTR. 4,301,134 4,277,707 1,930,152 - 2,370,982 44.9% 1,894,918 ANIMAL CONTROL 1,066,360 1,042,167 358,349 474,760 233,251 78.1% 249,372 Total 62,373,558 61,192,945 30,543,585 1,035,520 30,794,453 50.6% 28,001,543 Fire
ADMINISTRATION 1,626,701 1,620,294 1,133,486 - 493,214 69.7% 999,405 EMERGENCY SRVS / PUBLIC ED 544,545 543,168 253,512 - 291,033 46.6% 223,205 PREVENTION 1,629,034 1,516,456 733,524 - 895,510 45.0% 653,396 WILDLAND FIRE MITIGATION PROG. 436,682 397,918 169,483 - 267,198 38.8% 162,070 OPERATIONS 35,714,510 32,499,169 17,118,967 45,484 18,550,060 48.1% 15,306,993 TRAINING AND RECRUITMENT 1,858,595 1,713,641 476,499 4,543 1,377,553 25.9% 856,746 ARFF 4,436,031 4,090,031 2,279,949 - 2,156,082 51.4% 1,872,481 Total 46,246,098 42,380,676 22,165,420 50,027 24,030,650 48.0% 20,074,296 TOTAL PUBLIC SAFETY 108,619,656 103,573,620 52,709,005 1,085,548 54,825,103 49.5% 48,075,839

PUBLIC WORKS
Public Works
ADMINISTRATION 1,927,270 1,956,797 819,308 31,078 1,106,411 43.5% 835,667 ENGINEERING SVCS 10,831,773 10,845,794 5,005,569 1,790 5,838,436 46.2% 4,563,404 PUBLIC RT OF WAY MGMT 2,428,203 2,448,302 1,074,742 16,366 1,357,194 44.6% 1,049,187 Total 15,250,893 15,187,246 6,899,618 49,234 8,302,040 45.6% 6,448,258 TOTAL PUBLIC WORKS 15,250,893 15,187,246 6,899,618 49,234 8,302,040 45.6% 6,448,258

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COMMUNITY SERVICES
Parks & Recreation
REC PROGRAM MGMT 897,508 883,128 524,600 9,191 363,716 59.5% 552,874 FACILITIES & SPECIAL EVENTS 2,423,941 2,450,750 1,118,212 177,262 1,128,467 53.4% 1,081,759 YOUTH ACTIVITIES 1,852,783 1,802,962 860,297 33,967 958,520 48.3% 817,088 ACTIVE ADULTS 1,176,905 1,175,653 569,366 5,190 602,349 48.8% 516,722 AQUATICS 2,716,520 2,711,087 1,620,507 183,252 912,761 66.4% 1,424,923 SPORTS 1,585,416 1,593,010 789,138 136,205 660,072 58.4% 660,491 NEIGHBORHOOD/OUTREACH SERV 1,692,130 1,679,472 717,293 20,032 954,805 43.6% 647,815 ADMINISTRATION 1,744,093 1,740,812 848,423 434 895,236 48.7% 746,685 PROJECT MANAGEMENT TEAM 1,166,872 1,141,579 516,388 11,253 639,231 45.2% 410,977 PARK OPERATIONS MNGMNT 1,516,441 1,510,344 686,845 63,929 765,667 49.5% 690,128 GROUNDS & FACILITIES MAINT. 8,349,876 8,243,319 3,564,431 286,659 4,498,785 46.1% 3,286,716 FORESTRY 2,144,523 2,139,374 967,551 89,113 1,087,858 49.3% 977,571 BEACH MAINTENANCE 363,327 363,025 175,473 12,981 174,873 51.9% 118,910 MEDIANS PARKWAYS&CONTRACTS 613,585 612,913 233,875 170,779 208,931 65.9% 192,881 Total 28,243,919 28,047,427 13,192,399 1,200,249 13,851,271 51.0% 12,125,542 Library
ADMINISTRATION 1,080,355 998,300 473,308 - 524,992 47.4% 563,675 CENTRAL LIBRARY 7,659,841 7,755,010 3,512,783 134,199 4,108,027 47.0% 2,765,220 EASTSIDE LIBRARY 661,165 661,504 325,332 2,215 333,957 49.5% 269,509 LIBRARY ON THE GO 461,718 461,913 219,226 - 242,687 47.5% 177,605 ADULT EDUCATION - - 21,225 - (21,225) 0.0% 201,488
Total 9,876,726 9,863,079 4,551,874 136,414 5,188,438 47.5% 3,977,498 TOTAL COMMUNITY SERVICES 38,120,645 37,910,506 17,744,273 1,336,663 19,039,709 50.1% 16,103,040

COMMUNITY DEVELOPMENT
Community Development
ADMINISTRATION 1,169,403 1,165,113 834,247 36,928 298,227 74.5% 1,076,090 HUMAN SERVICES 149,733 - - 85,756 63,977 57.3% 162,834
LONG RANGE PLAN & SPEC STUDY 1,594,817 1,540,735 576,177 30,808 987,831 38.1% 635,220 DEVEL & ENVIRONMENTAL REVIEW 2,981,378 2,089,169 1,053,081 104,249 1,824,048 38.8% 904,592 ZONING INFO & ENFORCEMENT 1,844,615 1,839,465 873,755 5,708 965,152 47.7% 768,118 DESIGN REV & HIST PRESERVATION 1,916,304 1,909,414 900,334 2,580 1,013,391 47.1% 808,144 BLDG INSP & CODE ENFORCEMENT 2,077,958 2,070,662 1,008,662 1,428 1,067,869 48.6% 787,696 RECORDS ARCHIVES & CLER SVCS 786,056 776,448 370,963 17,068 398,025 49.4% 345,482 BLDG COUNTER & PLAN REV SVCS 3,781,602 3,439,615 1,466,988 591,151 1,723,463 54.4% 1,372,966 CODE COMPLIANCE 1,143,763 1,138,778 545,585 6,004 592,173 48.2% 481,447 Total 17,445,629 15,969,397 7,629,792 881,681 8,934,156 48.8% 7,532,728 TOTAL COMMUNITY DEVELOPMENT 17,445,629 15,969,397 7,629,792 881,681 8,934,156 48.8% 7,532,728

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SUSTAINABILITY AND RESILIENCE
Sustainability and Resilience
ABATEMENT 305,513 500,506 217,625 105,109 177,772 64.5% 197,331 Total 500,506 305,513 217,625 105,109 177,771 64.5% 215,724 TOTAL SUSTAINABILITY AND RESILIENCE 500,506 305,513 217,625 105,109 177,771 64.5% 215,724

NON-DEPARTMENTAL
Non-Departmental
TRANSFERS OUT 4,311,777 4,157,777 3,041,929 - 1,115,848 73.2% 2,759,065 CAPITAL OUTLAY TRANSFER 575,026 575,026 439,202 - 135,824 76.4% 902,500 APPROP. RESERVE 500,000 423,000 - - 423,000 0.0% -
MEASURE C SALES TAX 35,119,802 78,405,849 13,662,082 - 64, 17.4% 743,767 16,020,546 MEASURE I TRANSFER 3,726,150 3,000,000 3,000,000 - - 100.0% - Sub Total 86,561,652 44,232,755 20,143,214 - 66, 23.3% 418,439 19,682,110 ANTICIPATED SALARY SAVINGS (601,260) (601,260) - (601,260) - 0.0% - TOTAL NON-DEPARTMENTAL 85,960,392 43,631,495 20,143,214 - 65, 23.4% 817,179 19,682,110 TOTAL EXPENDITURES 297,240,122 245,390,243 118,532,787 7,016,671 171,690,665 42.2% 109,397,733 ** The legal level of budgetary control is at the department level for the General Fund. Therefore, as long as the department as a whole is within budget, budgetary compliance has been achieved. The City actively monitors the budget status of each department and takes measures to address potential over budget situations before they occur.

For Enterprise and Internal Service Funds, the level of budgetary control is at the fund level. The City also monitors and addresses these fund types for potential over budget situations.

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Remaining
Adopted Revised YTD Encum- Balance with Percent of Previous Budget Budget Actual brances Revised budget Budget YTD

TRAFFIC SAFETY FUND
Revenue 245,000 245,000 163,278 - 81,722 66.6% 101,661
Expenditures 245,000 245,000 163,278 - 81,722 66.6% 101,661 Revenue Less Expenditures - - - - - -

CREEK RESTORATION/WATER QUALITY IMPRVMT
Revenue 6,772,647 6,772,647 4,019,988 - 2,752,660 59.4% 3,872,576 Expenditures 7,136,975 7,648,891 3,088,142 1,532,396 3,028,353 60.4% 2,804,939 Revenue Less Expenditures (876,243) (364,328) 931,845 (1,532,396) (275,693) 1,067,637

COMMUNITY DEVELOPMENT BLOCK GRANT
Revenue 1,147,812 2,066,275 217,817 - 1,848,458 10.5% 284,896 Expenditures 1,146,418 2,849,152 966,873 93,139 1,789,140 37.2% 92,307 Revenue Less Expenditures (782,877) 1,394 (749,056) (93,139) 59,318 192,589

COUNTY LIBRARY
Revenue 498,834 498,834 2,270 - 496,564 0.5% 1,182
Expenditures 487,876 490,058 245,095 3,570 241,394 50.7% 218,583 Revenue Less Expenditures 8,776 10,958 (242,824) (3,570) 255,169 (217,402)

STREETS FUND
Revenue 14,454,321 14,454,321 7,314,916 - 7,139,405 50.6% 7,881,923 Expenditures 14,583,350 14,772,237 7,000,591 138,807 7,632,839 48.3% 6,714,177 Revenue Less Expenditures (317,916) (129,029) 314,325 (138,807) (493,435) 1,167,746

MEASURE A FUND
Revenue 5,211,328 5,211,328 2,924,841 - 2,286,487 56.1% 2,239,037 Expenditures 5,519,615 6,045,862 2,979,336 418,399 2,648,127 56.2% 4,561,212 Revenue Less Expenditures (834,534) (308,287) (54,496) (418,399) (361,640) (2,322,174)

CITY OF SANTA BARBARA
Interim Statement of Revenues and Expenditures
Special Revenue Funds
For Six Months Ended December 31, 2025 (50.0% of Fiscal Year)

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Remaining
Adopted Revised YTD Encum- Balance with Percent of Previous Budget Budget Actual brances Revised budget Budget YTD

REVENUES
Service charges 42,584,431 42,584,431 21,365,666 - 21,218,765 50.2% 19,920,512 Other Fees & Charges 30,000 30,000 13,236 - 16,764 44.1% 13,600 Investment Income 295,599 295,599 199,598 - 96,001 67.5% 114,200 Rents & Concessions 30,133 30,133 17,582 - 12,552 58.3% - Grants 21,651 230,149 - - 230,149 0.0% -
Miscellaneous 28,888 28,888 11 - 28,877 0.0% 2,702
TOTAL REVENUES 43,199,200 42,990,702 21,596,093 - 21,603,107 50.0% 20,051,014

EXPENSES
Salaries & Benefits 2,416,512 2,438,536 1,063,611 - 1,374,925 43.6% 981,227 Materials, Supplies & Services 38,686,000 38,910,469 16,586,159 11,595,976 10,728,334 72.4% 13,409,646 Special Projects 810,100 810,100 353,763 1,547 454,789 43.9% 339,675 Transfers-Out 200,000 200,000 100,000 - 100,000 50.0% 100,000 Equipment 220,600 489,994 75,917 68,194 345,883 29.4% 137,165 Other 40,000 40,000 - - 40,000 0.0% -
TOTAL EXPENSES 42,889,098 42,373,212 18,179,450 11,665,717 13,043,932 69.6% 14,967,713 Revenue Less Expense 310,102 617,491 3,416,643 (11,665,717) 8,559,176 5,083,301