City of Santa Rosa Proposed Budget
FY 2026-27
LORI ANN FARRELL , CIT Y MANAGER | SCOTT WAGNER , CHIEF FINANCIAL OFFICER
City Manager’s Comments
PROPOSED BUDGET FY 2026 -27
Citywide Budget Overview
PROPOSED BUDGET FY 2026 -27
Presentation Overview
4 ➢FY 2026-27 Proposed Budget All Funds
➢FY 2026-27 Proposed Budget General Fund
➢Department Budget Review
➢Department Recap & Reductions
➢Internal Service Funds
➢Enterprise Funds
➢Capital Improvement Program
➢Year 2
FY 2026-27 Budget Process
Public Hearing on
Budget Priorities
January 27, 2026
City Manager
Review of
Department Budgets
March 2026
Budget Review with
LTFPA
April 9, 2026
City Council Study
Session
April 21, 2026
City Council
Study Session
May 5 & 6, 2026
Draft of Budget
Books available to
the public
June 2, 2026
Budget Adoption
Public Hearing
June 16, 2026
5 FY 2026-27 Budget Process
Base Budget Development
➢Status quo budgets that maintain current staffing and programs were developed by departments and Finance
➢Status quo budget includes contractually agreed upon compensation ➢Proposed increases include uncontrollable and fixed costs such as CalPERS retirement, benefits, and professional services contracts
➢City Manager reviewed all base budget calculations, major expense categories, and revenue estimates by department and funds beginning January 2026 ➢Original FY 2026-27 Base Budget has a ($17.5M) deficit without action ➢Preliminary summary presented to City Council on April 21, 2026 6 FY 2026-27 Budget Process
City Manager’s Proposed Budget
➢Departments were directed to develop 1% & 3% reductions ➢Through a multi-pronged approach, the City Manager’s proposed budget contains almost $9M in deficit reduction solutions as part of a two-year process ➢Year 1 (FY 2026-27):
➢Strategic Reserve Usage: Utilizing reserve funds partially to prevent major cuts to services ➢Adjusted staffing as grant funded programs now expired ➢Vacancy Management: Eliminating specific vacant positions to minimize impact on services ➢Innovative Financing: Pension cost smoothing through Fresh Start, major apparatus lease financing to match useful life of equipment
➢Targeted cost recovery improvements
7 FY 2026-27 Citywide
Revenues by Fund (in millions)
Fund Type
2025-26
Adopted
Budget
2026-27
Proposed
Budget
$
Change
%
Change
General Fund $215.0 $224.7 $9.6 4.5%
Enterprise Funds 200.0 207.8 7.8 3.9%
Special Revenue Funds 44.3 45.6 1.4 3.2%
Other Funds 0.5 0.5 - -
Housing Authority 54.1 54.2 0.1 0.4%
Successor Agency to RDA 3.0 3.0 - -
Total $516.9 $535.8 $18.9 3.7%
8 FY 2026-27 Citywide
Expenditures by Fund T ype (in millions)
Fund Type
2025-26
Adopted
Budget
2026-27
Proposed
Budget
$
Change
%
Change
General Fund $216.8 $231.1 14.3 6.6%
Enterprise (Operating) 171.8 177.7 5.9 3.4%
Enterprise (CIP) 45.2 44.1 (1.1) (2.3%)
Non-Enterprise (CIP) 30.8 32.4 1.6 5.2%
Special Revenue 28.6 28.0 (0.6) (1.9%)
Other Funds 1.2 1.2 - -
Housing Authority 56.7 57.1 0.4 0.7%
Successor Agency to RDA 3.0 3.0 - -
Total $554.1 $574.7 $20.6 3.7%
9 FY 2026-27 Citywide Expenditures by Fund
10 General Fund Budget
Overview
PROPOSED BUDGET FY 2026 -27
FY 2026-27 General Fund Summary
(in millions)
Proposed
General Fund Budget
Revenue $224.7
Transfers In $8.2
Total Revenues + Transfers In $232.9
Expenditures ($231.1)
Transfers Out ($9.5)
Total Expenditures + Transfers Out ($240.5)
Subtotal Deficit ($7.6)
Strategic Use of Reserves $7.6
Total* -
12*Reflects 2-year strategy with $7.6M additional reductions (or additional revenue) required in FY 2027-28 General Fund Revenue Overview
➢Property tax maintains a 3- & 5-year average of over 5.5% growth +$2.3M ➢Sales tax increase of 1.5% per recent performance +$1.1M ➢Projected UUT increases in Gas & Electric, offset by decreases in Cable and Telephone +$700K
➢Other taxes contains Cannabis Industry Tax, Transient Occupancy Tax, Franchise Fees, Real Property Transfer Tax, but is mainly grown by increase in Business Tax +$2.8M
➢Permits are trending at lower cost per permit, resulting in a slight decrease ($400K) ➢Recreation revenues reflect over 14% growth in enrollment and recent fee increases +$800K
➢Increase of $350K to fund EMS Fire Captain formerly in inRESPONSE 13 FY 2026-27 General Fund Revenues
by Category (in millions)
14 Category
2025-26
Adopted
Budget
2026-27
Proposed
Budget
$
Change
%
Change
Property Tax $41.5 $43.8 $2.3 5.5%
Sales Tax 70.4 71.5 1.1 1.5%
Utility Users Tax 14.4 15.1 0.7 5.1%
Vehicle License Fees 19.8 21.2 1.4 7.2%
Other Taxes 33.3 36.1 2.8 8.4%
Permits, Fines & Charges 14.1 13.7 (0.4) (3.0%)
Interfund Charges 12.4 12.4 - -
Recreation Revenues 3.3 4.1 0.8 24.5%
Intergov’t, Interest & Other 5.9 6.8 0.9 14.7%
Total $215.1 $224.7 $9.6 4.5%
General Fund Revenues by Category
15 51%
Sales Tax &
Property Tax
16 City Share of Property T ax & Sales T ax
Property Tax
Allocation
Sales Tax
Allocation
General
Fund
Transfers Out
Detail
(in millions)
17 Category
2025-26
Adopted
Budget
2026-27
Proposed
Budget
$
Change
%
Change
Special
Revenue Funds $2.3 $2.5 $0.2 0%
Special
Assessment
Funds
0.1 0.1 - -
Parking Fund 0.1 0.1 - -
Pension Funds - 5.6 5.6 n/a
Total $2.5 $8.2 $5.8 230%
General Fund
Transfers In Detail
(in millions)
• NEW- $5.6M transfer in from
pension fund (Fresh Start strategy)
General Fund Expenditures
PROPOSED BUDGET FY 2026 -27
General Fund Expenditure Highlights
Major Increases
➢Contractually agreed upon compensation adjustments for all bargaining units +$4.9M ➢Align overtime budget with actual costs for the Police Department +$1M and Fire Department +$2.5M to comply with 24/7 staffing
➢Fixed cost increases in Health Insurance and Retirement benefits +$1.3M ➢Professional Services grew +$1M for existing contractual increases and +$550K for election costs and +$450K for Animal Control and shelter contract ➢Uncontrollable increases in vehicle costs for gasoline, vehicle replacement and maintenance +$700K
➢Information Technology costs driven by licensing increases and staffing costs +$500K ➢Overall, $14.3M increase in expenditures equals a 6.6% YOY change 19 General Fund Expenditure Highlights
Major Decreases
➢Savings of ($4.9M) in department budget reductions
➢($3.8M) in pension costs with newly proposed pension strategy ➢Major Fire Apparatus leasing strategy savings of ($1M) ➢Property insurance decrease of ($600K) due to increase in prior year funding to build required reserves
20 21
FY 2026-27 General Fund Expenditures
by Category (in millions)
Category 2025-26
Adopted Budget
2026-27
Proposed Budget
$
Change
%
Change
Salaries $91.6 $96.5 $4.9 5.3%
Overtime 7.1 10.7 3.6 50.1%
Benefits 67.0 70.0 3.0 4.5%
Professional Services 13.6 15.5 1.9 14.0%
Vehicle Expense 11.0 10.6 (0.4) (3.0%)
Operational Supplies 3.3 3.8 0.5 15.2%
Utilities 5.9 6.2 0.3 5.1%
Information Technology 6.7 7.2 0.5 7.5%
Liability/Property Insurance 5.7 5.1 (0.6) (10.5%)
Other Miscellaneous 2.6 3.0 0.4 15.4% O&M Projects 2.3 2.5 0.2 8.7%
Total $216.8 $231.1 $14.3 6.6%
General Fund Expenditures by Category
22 76%
Salaries &
Benefits
23 FY 2026-27 General Fund Expenditures
by Department (in millions)
Dept
2025-26
Proposed
Budget
2026-27
Proposed
Budget
$
Change
%
Change
Admin $21.8 $23.3 $1.5 6.8%
Non Dep (9.9) (9.6) 0.3 3.2%
Fire 58.9 62.2 3.3 5.6%
PED 19.1 19.8 0.7 3.7%
Police 80.0 85.5 5.5 6.9%
Rec 18.4 11.2 (7.2) (39.1%)
TPW 27.7 37.9 10.2 36.8%
SR Water 0.7 0.8 0.1 14.3%
Total $216.8 $231.1 $14.4 6.6%
General Fund Expenditures by Department
24 64.5%
Public Safety
General
Fund
Transfers Out
Detail
(in millions)
25 Category
2025-26
Adopted
Budget
2026-27
Proposed
Budget
$
Change
%
Change
Bennett Valley
Golf Course $0.5 $0.5 - 0%
CIP 2.0 1.9 (0.1) (5.9%)
Parking Fund 1.6 1.9 0.3 18.4%
RPTT – Housing 1.1 1.1 - -
Homeless
Services –
General Fund
3.3 3.3 - -
Misc. 0.8 0.8 - -
Total $9.2 $9.5 $0.2 2.3%
General Fund
Transfers Out
Detail
(in millions)
➢ Final year for receipt of $662K
from Sonoma County for Roseland
Pavement Maintenance, per
annexation agreement
General
Fund
Baseline
Public
Safety and
Prevention
Tax
26 Police - 34.3% Fire - 23.7% Violence
Prevention - 0.4%
General Fund
Department
Budget
$85,535,331 $62,263,302 $1,118,945
Baseline
Calculation 79,293,978 54,800,040 965,522
Over (Under)
Baseline $6,241,353 $7,463,262 $153,423
Multi-Year Budget Strategy
PROPOSED BUDGET FY 2026 -27
Actions T aken to Date
Budget Engagement
➢Budget engagement efforts over the past year:
➢Monthly Fiscal Update Meetings with labor representatives with agenda driven by labor including:
➢Investment portfolio, CalPERS pension expenses, CIP funding, all assumptions in the City’s Long Range Financial Forecast & FY 2026-27 budget development strategy
➢Formation of City Manager Budget Working Group with community members ➢LTFPA Subcommittee line-by-line review of department budgets 29 Prior
Adopted
Budget
Reductions
➢ Council adopted $15.2
million of ongoing
budget reductions
since mid-year FY
2024-25
➢ FY 2025-26 original
deficit amount of $19.3
million reduced to $8.4
million
30 Phase One: FY 2024-25 & FY 2025-26
Multi-Year Strategy
➢The City has been engaged in a multi-year process to address the structural deficit in the General Fund that began with mid-year adjustments in fiscal year 2024-25.
This has included:
➢$15.2 million in ongoing reductions; $5.9M in FY 26-27 and $3.8M of Pension savings ➢Workforce reduction of 54 full time equivalent positions; Additional 22 full time equivalent positions proposed to be reduced from the General Fund in FY 26-27 ➢$10.2 million in one time funding re-allocated from projects to shore up reserves ➢Voter approved revenue measure EE & FF which generated an additional $3.7 million in Business and Transient Occupancy Taxes
➢No mid-year cuts in fiscal year 2025-26
31 FY 2026-27 Scenario Analysis
33 Scenario Analysis
➢Analysis was completed to understand organizational impact of fully addressing the $17.5 million deficit in the coming adopted budget, FY 2026-27
➢The City’s proposed budget will need to balance maintaining core services versus abrupt change
➢These scenarios are illustrative and not being recommended ➢They illustrate FTE reductions necessary to obtain the target 34 Scenarios Analysis – Full Cut Across the Board
*Not being recommended
Scenarios Analysis – Full Cut Across the Board
Excluding Public Safety
*Not being recommended
*19.2 Additional Employee Cuts
Scale of Deficit
* Not being Recommended
➢$17.5M Deficit
➢($3.8M) Recreation – Eliminate all Programs (32 FTE)
➢($3.4M) Homeless Services – Eliminate all Services (4 FTE) ➢($1.2M) Annual CIP General Fund Commitment (legally required) ➢$9.1M Shortfall
37 For discussion purposes only
Scale of Deficit
* Not being Recommended
➢$17.5M Deficit
➢($6.5M) Finance - Eliminate Department (32.6 FTE)
➢($3.4M) Human Resources - Eliminate Department (13 FTE) ➢($3.3M) City Attorney’s Office – Eliminate Department (15 FTE) ➢($2.2M) City Manager’s Office – Eliminate Department (9 FTE) ➢$2.1M Shortfall
38 For discussion purposes only
FY 2026-27 Multi-Pronged
Solutions Approach
Strategies Considered
40 Eliminate Vacant
Positions
Major Apparatus
Leasing
Use of Reserves
Pensions Savings
Strategy
Flex
Programming for
Expiring Grants
Department
Consolidation
Use of
Technology
Alignment of
Budget to Actual
Spending
Enhanced Cost
Recovery
Transfer of Costs
to Eligible Funds
Credit Card
Convenience
Fees
Reduction of
Minor Capital
Support
General Fund Solutions
41 Strategy Description Amount
Pension Savings Strategy 3,800,000
Flexing Staffing Levels Consistent With Grant Funding 3,600,000 Major Apparatus Leasing 1,000,000
Eliminate Vacant Positions 486,105
Increase Revenue 350,000
Credit Card Convenience Fees* 264,000
Reduction of Minor Capital Support 100,000
Alignment of Budget to Actual Spending 84,325
Enhanced Cost Recovery 70,000
Department Consolidations 49,343
Transfer of Costs to Eligible Special Revenue Funds 45,000 Use of Technology 21,000
Total $9,869,805
*Primarily PED plans and permits, excludes Recreation and Parking; program already in effect for Water Department Department Budget Highlights
PROPOSED BUDGET FY 2026 -27
Major Department Staffing Modifications -
Organizational Alignment
43 ➢ Consolidation of CIRO Department into the City Manager’s Office, including 7.0 FTEs and support costs
➢ Transfer of Parking Division to PED Department to realign program and maximize efficiencies, including 28.0 FTEs and support costs
Major Department Staffing Modifications -
Grant Funded Positions
44 ➢ Total grant funded positions eliminated - 18.0 FTE (3-filled) ➢ Move 12.0 FTE (filled) Firefighters from expired grant to vacant General Fund and Measure H Fund positions
➢ Retain 1.0 FTE (filled) grant funded Fire Captain with increased cost recovery from EMS revenue
➢ Eliminate 3.0 FTE (filled) & 3.0 FTE (vacant) Single Role Paramedics from expired grant
Major Department Staffing Modifications
45 ➢ Eliminate 10.0 FTE (vacant) positions across various departments
➢ Align 3.0 FTE with classifications
➢ Net 28.0 FTE positions eliminated
City Council – by Program
46 Expenditures by Program 2025-26
Budget
2026-27
Budget
$ %
Change Change
Administration $964,104 $943,342 -$20,762 -2.2%
Elections $0 $600,000 $600,000 n/a
Total $964,104 $1,543,342 $579,238 60.1%
• $600,000 increase for FY 2026-27 election costs
• Decrease in healthcare due to benefit elections
CAO – by Program
47 Expenditures by Program 2025-26
Budget
2026-27
Budget $ Change % Change
Legal Services $4,304,001 $4,337,094 $33,093 0.8%
Total $4,304,001 $4,337,094 $33,093 0.8%
• Contractual increases in
Salaries and IT costs
Dept. FY 25-26 FTE Change FY 26-27
CAO 15.00 - 15.00
CMO – by Program
48 • Consolidation of CIRO with CMO
• Contractual increases in Salaries and
IT costs
Dept. FY 25-26 FTE Change FY 26-27
CMO 9.00 7.00 16.00
Expenditures by Program 2025-26 2026-27 $ %
Budget Budget Change Change
General Administration $2,673,517 $2,712,090 $38,573 1.4% City Clerk $81,256 $81,256 $0 0.0%
Comms & Intergov Relations $0 $1,649,947 $1,649,947 100.0% Community Engagement $0 $126,450 $126,450 100.0%
CAB Grant $0 $35,000 $35,000 100.0%
Total $2,754,773 $4,604,743 $1,849,970 67.2%
Finance – by Program
49 Expenditures by Program 2025-26
Budget
2026-27
Budget $ Change % Change
General Administration $2,538,720 $3,004,818 $466,098 18.4% Payroll and Benefits $920,354 $1,000,811 $80,457 8.7%
Financial Services $3,298,332 $3,235,702 -$62,630 -1.9% Purchasing $1,407,641 $1,456,578 $48,937 3.5%
Parking Services O&M $4,324,374 $0 -$4,324,374 -100.0%
Parking Enforcement $1,627,669 $0 -$1,627,669 -100.0%
Total $14,117,090 $8,697,909 -$5,419,181 -38.4%
• $500,000 increase in business tax contract that
is offset by the increased business tax revenue
• Parking Division moved to Planning &
Economic Development
• Contractual increases in Salaries and IT costs
Dept. FY 25-26 FTE Change FY 26-27
Finance 60.60 -28.00 32.60
HCS Recreation– by Fund
50 Expenditures by Fund 2025-26 2026-27 $ %
(All Funds) Budget Budget Change Change
General Fund $18,368,897 $11,151,216 -$7,217,681 -39.3% Public Safety & Prevention Tax - VPP $3,032,783 $2,480,265 -$552,518 -18.2% Change For Kids Fund $276,522 $283,253 $6,731 2.4%
Measure M Parks $2,684,153 $270,052 -$2,414,101 -89.9%
Bennett Valley Golf Course $774,539 $0 -$774,539 -100.0% Special Assessment Tax District $84,359 $0 -$84,359 -100.0% Capital Improvement Fund $8,910,729 $0 -$8,910,729 -100.0% Total $34,131,982 $14,184,786 -$19,947,196 -58.4%
HCS Recreation – Major budget Changes
• Recreation division transferred to HCS including 37.55 FTEs • Parks division transferred to TPW including 32.0 FTEs • Elimination of 1.0 FTE Program Lead in the General Fund; anticipated vacancy • Elimination of 2.0 vacant FTE in the PSAP Special Revenue fund: 1.0 FTE Community Outreach Specialist and 1.0 FTE Administrative Secretary • Contractual increases in Salaries and IT costs
51 Dept. FY 25-26 FTE
Increase
FTE
Decrease FY 26-27
Recreation - 37.55 (3.00) 34.55
PED – by Fund
52 2025-26 2026-27 $ %
Expenditures by Fund Budget Budget Change Change
General Fund $19,073,064 $19,756,924 $683,860 3.6%
Art In-lieu Fund $98,700 $93,270 -$5,430 -5.5%
Santa Rosa Tourism BIA Fund $721,219 $500,000 -$221,219 -30.7% Admin Hearing Fund $222,101 $443,716 $221,615 99.8%
Parking District Fund $0 $6,377,426 $6,377,426 100.0%
Total $20,115,084 $27,171,336 $7,056,252 35.1%
Dept. FY 25-26 FTE Change FY 26-27
PED 75.00 28.00 103.00
• $165K savings for aligning budget to actual
costs and transferring costs to eligible funds
• Parking Division and 28.0 FTEs moved to
Planning & Economic Development
TPW – by Program (General Fund only)
53 Expenditures by Program 2025-26
Budget
2026-27
Budget $ Change % Change
General Administration $1,870,551 $1,967,437 $96,886 5.2% Traffic $2,081,229 $2,204,774 $123,545 5.9%
Capital Projects Engineering $1,943,443 $1,966,569 $23,126 1.2% Field Services $13,687,738 $15,033,104 $1,345,366 9.8%
Materials Engineering $787,782 $897,779 $109,997 14.0%
Facilities $6,095,198 $6,513,108 $417,910 6.9%
Parks $0 $8,036,255 $8,036,255 n/a
Real Estate Services $820,824 $871,343 $50,519 6.2%
O&M Projects $472,000 $372,000 -$100,000 -21.2%
Total $27,758,765 $37,862,369 $10,103,604 36.4%
TPW – Major budget Changes
• Transfer of Parks division into TPW of 32.0 FTEs
• Reduction of 1.0 vacant Administrative Secretary
• Reduction of 3.0 FTE vacant Surveyors
• Reduction of $100K for minor capital support
• $1.3M Field Services increase mainly due to asphalt and to better align budget with past actual spending
54 Dept. FY 25-26 FTE
Increase
FTE
Decrease FY 26-27
TPW 250.00 32.00 (4.00) 278.00
Non-Departmental – by Program
55 Expenditures by Program 2025-26
Budget
2026-27
Budget $ Change % Change
Citywide GF Insurance $5,701,410 $5,137,730 -$563,680 -9.9% Sonoma Co Transportation Authority $130,000 $135,000 $5,000 3.8% General Fund Admin Cost Plan -$18,212,381 -$19,695,087 -$1,482,706 8.1% Animal Control Shelter $3,346,441 $3,800,000 $453,559 13.6% County Admin Fee $380,000 $400,000 $20,000 5.3%
Contract Services $375,000 $359,000 -$16,000 -4.3%
Non-Program -$1,613,000 $290,413 $1,903,413 -118.0%
Debt Service $727,650 $730,650 $3,000 0.4%
Total -$9,164,880 -$8,842,294 $322,586 -3.5%
Non-Departmental – Major budget
Changes
• Increase of $1.8M for Non-Program costs of Pension Strategy changes; offset by Transfer In to the General Fund
• Increase of $450K for Animal Control and Shelter contract with Sonoma County
• Decrease of $1.5M in GF Administration Costs, offset by cost allocations to other General Fund departments.
56 Homeless Services
57 • Decrease of 1.0 FTE vacant Housing & Community Services Technician Dept. FY 25-26 FTE Change FY 26-27
Homeless
Svcs 4.10 (1.00) 3.10
Expenditures by Fund 2025-26 2026-27 $ %
(All Funds) Budget Budget Change Change
Homeless Services $4,069,380 $3,847,844 -$221,536 -5.4% Total $4,069,380 $3,847,844 -$221,536 -5.4%
Questions
Public Safety
Recommendations
PROPOSED BUDGET FY 2026 -27
Police Department
PROPOSED BUDGET FY 2026 -27
Major Budget Changes - Police
61 • Maintains Police response and service delivery with minor reductions of $51K for vehicle efficiencies and use of technology
• Contractual increases in Salaries and IT costs
• Increase of $1M in Police Overtime budget
• Increase of $123K funded by Opioid Settlement funds for Police Wellness Program
Dept. FY 25-26 FTE Change FY 26-27
Police 249.00 - 249.00
Police – by Fund
62 Expenditures by Fund 2025-26 2026-27 $ %
(All Funds) Budget Budget Change Change
General Fund $79,987,062 $85,535,331 $5,548,269 6.9%
Public Safety & Prevention Tax – Police $5,294,760 $5,325,567 $30,807 0.6% Federal Narcotics Asset Forfeiture $50,000 $37,000 -$13,000 -26.0% Supplemental Law Enforcement $525,000 $603,000 $78,000 14.9% State Narcotics Asset Forfeiture $125,000 $125,000 $0 0.0% Total $85,981,822 $91,625,898 $5,644,076 6.6%
Police – by Program
63 Expenditures by Program 2025-26
Budget
2026-27
Budget $ Change % Change
General Administration $11,958,259 $13,599,139 $1,640,880 13.7% Technical Services $10,925,884 $11,159,844 $233,960 2.1% Support Bureau $1,932,112 $2,025,305 $93,193 4.8%
Public Safety & Prevention Tax – Police $5,294,760 $5,325,567 $30,807 0.6% Field Services $41,220,658 $42,811,899 $1,591,241 3.9%
Investigative Services $14,236,693 $16,080,644 $1,843,951 13.0% O&M Projects $413,456 $623,500 $210,044 50.8%
Total $85,981,822 $91,625,898 $5,644,076 6.6%
Police – Overtime Actions
Worked diligently to reduce excess overtime
• Detective teams rotated working shifts in patrol two days a week • Held vacancies in investigative teams
• Reviewing the overtime monthly in Command Staff Meetings • Utilizing civilian staff where possible
Each year the number of overtime hours allotted has been reduced Police Overtime Hours
$2,768,859 $2,683,361 $2,501,326
$2,600,000
30,311 Hours
26,644 Hours
22,936 Hours 22,650 Hours
10,000
15,000
20,000
25,000
30,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
FY 22/23 FY 23/24 FY 24/25 FY 25/26 *
Cost Hours
*Projected
inRESPONSE Program
PROPOSED BUDGET FY 2026 -27
inRESPONSE Mental Health Support T eam
67 • The inRESPONSE program was launched in January of 2022; • Program included 6.0 FTE Single Role Paramedics (currently 3.0 FTE are filled, and 3.0 FTE are vacant) and 1.0 FTE Fire Captain (currently filled) • Contracts were entered with two non-profits agencies: Buckelew Programs and Catholic Charities. (Police)
• The program expanded to 24/7 coverage to address mental health crisis calls across our city with a licensed mental health professional. • Future County Measure O funds will be greatly reduced to an estimated $1.6M for FY 26-27 and only $1.5M for FY 27-28.
inRESPONSE Mental Health Support T eam
68 • ARPA one-time funds supported the program from January 2022 through November 2024 for a total of $3,979,000.
• County Measure O funds have been used to fund the program since July 2022 for a total $5,091,941.
• With $1.5M reduction in grant from the County, the 6.0 FTE Single Role Paramedics are unfunded and being proposed for reduction (Fire) • inRESPONSE team will adapt to new budget and will focus on core mission of mental health and homeless response
•The Fire Department has increased cost recovery to support the 1.0 FTE Fire Captain for Emergency Medical Services. (Fire)
Fire Department
PROPOSED BUDGET FY 2026 -27
Major Budget Changes - Fire
70 • Maintains core and ongoing General Fund Fire response and service delivery • Contractual increases in Salaries and IT costs
• Increase of $2.5M in Fire Overtime budget; $1M decrease in vehicle expenses for Apparatus leasing strategy
• Elimination of 12.0 FTE SAFER grant positions, 6.0 FTE inRESPONSE positions (3.0 FTE filled and 3.0 FTE vacant), and 1.0 FTE vacant Community Outreach Specialist Dept. FY 25-26 FTE Change FY 26-27
Fire 180.00 -19.00 161.00
Fire – by Fund
71 Fire – by Program
72 SAFER Grant Overview
73 • On August 22, 2023, City Council approved the SAFER Grant accepting $7,084,440 to hire 12.0 FTE Firefighters creating two paramedic squads. • At the end of the Period of Performance, the granted agency cannot lay off the employees.
• As discussed during the August 22, 2023, City Council presentation, there are three ways to address the end of the grant:
• Absorb the positions into the General Fund
• Secure an alternative funding source
• Absorb the positions by attrition
SAFER Grant Overview
74 • Resources deployed are part of minimum daily staffing, however overtime is not applicable under SAFER
• Does not include vehicles, equipment, PPE, uniforms, etc. • Remaining balance of approved funds expected to be depleted on or before June 30, 2026
• Staff recommends absorbing 6.0 FTEs into General Fund vacancies and
6.0 FTEs into Measure H vacancies.
• 12.0 FTE resulting vacancies from vacated SAFER grant positions will be eliminated
Measure H Background
75 • During FY 25-26, Measure H was implemented to include:
• 20 FTEs, recommending an additional 1.0 FTE 40 Hour Fire Captain • One new engine company (Engine 9)
• One new on-duty Battalion Chief (Battalion 2)
• Two new Vegetation Management Inspectors
• Debt Service on one new Fire Station (Station 9)
• Staff recommendation to fill 6.0 FTE vacant Firefighters with positions being eliminated from SAFER grant
Measure H 3-0 Rescue Plus Squad
76 Fire Overtime History
77 • Overtime in the Fire Department Budget:
• Minimum Daily Staffing (by policy):
• 47 personnel on-duty in the Suppression Division per day • 2 Battalion Chiefs (1/0 Staff)
• 11 Engine Companies (3/0 Staff)
• 2 Truck Companies (4/0 Staff)
• 2 Paramedic Squads (2/0 Staff)
• Positions must be filled, unlike administrative roles • ‘Relief’ positions were eliminated in FY 24-25 and 25-26 Budget Fire Overtime History
78 Fire Overtime Strategy/ Progress
79 • Fire Department Overtime Reduction Strategies:
• ‘Relief’ Positions
• Risk Management solutions
• Human Resources solutions
• 2017 Staffing Study
• FTE vs OT
• Right size the Fire Department Non-Contract OT Budget • Staff recommends adding $2.5M to Fire OT budget in order to meet minimum daily staffing needs
Recap & Reductions
PROPOSED BUDGET FY 2026 -27
General Fund Challenges & Solutions
81 • Deficit of ($17.5M) in FY 2026-27 Base Budget if no action taken • Approximately $10M in recommended strategies to close budget gap and bring the deficit down to ($7.6M)
• One-time use of reserves will be used in FY 2026-27
• Additional department reductions or increased revenue will need to be explored in the next 12 months to close remaining gap
• Expenditure growth continues to outpace revenue growth BEFORE:
Base Budget Long-Range Financial Forecast
82 AFTER:
Reductions Long-Range Financial Forecast
83 Revenues
Transfers In
Total Revenues & TI
Expenditures
Transfers Out
Total Expenditures & TO
Surplus (Deficit) ($13.8)
FY 30-31
$242.1
2.6 $244.8
257.6
9.6 $267.2
($22.4)
2.6 $245.1
249.4
9.4 $258.8
$242.4
($9.8)
$238.8
241.6
9.2 $250.8
($12.1)
$234.0
234.1
9.6 $243.7
($8.4)
FY 26-27
$224.7
8.2 $232.9
231.1
9.5 FY 25-26
$215.1
2.5 $217.6
216.8
$240.5
($7.6)
9.2 $226.0
$231.3
2.6 FY 28-29
$236.1
2.6 FY 27-28 FY 29-30
Deficit Before & After Proposed Solutions
84 Deficit BEFORE
Deficit AFTER
($42.8)($8.4) ($17.5) ($25.3)
FY 28-29 FY 29-30 FY 30-31FY 25-26 FY 26-27 FY 27-28
($12.1) ($13.8) ($22.4)($8.4) ($7.6) ($9.8)
($31.3) ($33.6)
Changes to Base Budget
85 • Recommended reductions totaling $9.5M, will bring the ($17.5M) deficit down to ($8M)
• $350K Increase in Revenue will bring the deficit down further to ($7.6M)
• Reserves will be used as a temporary measure to offset the General Fund deficit
• Future years will require further reductions or increases to revenue to continue to close the budget gap
FY 2026-27 Recommended Reductions
86 Dept Description Amount
All Pension Savings Strategy 3,800,000
Fire Elimination of 12.0 Fire Fighters (vacant) with expiration of SAFER grant 2,400,000 Fire Elimination of 6.0 FTE InResponse Paramedics with expiration of InRESPONSE funding (3.0 FTE filled, 3.0 FTE vacant) 1,200,000
Fire Savings from leasing Fire Apparatus 1,000,000
Fin Credit card convenience fees 264,000
Fire Elimination 1.0 FTE Community Outreach Specialist (vacant) 136,642 HCS Elimination of 1.0 Housing & Community Services Technician (vacant) 134,786 TPW Elimination of 1.0 FTE Administrative Secretary (vacant) 122,808 TPW Reduction of minor capital support 100,000
FY 2026-27 Recommended Reductions (cont.)
87 Dept Description Amount
Rec Elimination of 1.0 FTE Recreation Program Lead (filled) 91,869 PED Enhanced cost recovery charging allowable costs to eligble funds 70,000 CIRO &
CMO
Aligning position title with current staffing by exchanging a budgeted Chief Comunications & Intergovt'l Relations Officer for a Communications & Intergovt'l Manager 49,374 PED Transfer General Fund costs to eligible Admin Hearing Special Revenue Fund 45,000 PED Aligning position title with current staffing by exchanging a budgeted Senior Planner for City Planner 35,226
Police Vehicle costs for 3 police vehicles 30,000
Police Elimination of Speakwrite Contract 21,000
PED Aligning budget of services and supplies to actual expenditures 15,000 Rec Aligning budget of services and supplies to actual expenditures 4,100 Total 9,519,805
General Fund Reserves Spend Down
88 FY2025 FY2026 FY2027 FY2028 FY2029 FY2030
6/30/2025 Final Reserves 79,582,000$
FY 26/27 Budget Deficit (7,600,000)$
6/30/2026 Projected Reserves 71,982,000$
FY 27/28 Budget Deficit (9,800,000)$
6/30/2027 Projected Reserves 62,182,000$
FY 28/29 Budget Deficit (12,100,000)$
6/30/2028 Projected Reserves 50,082,000$
FY 29/30 Budget Deficit (13,800,000)$
6/30/2029 Projected Reserves 36,282,000$
FY 30/31 Budget Deficit (22,400,000)$
6/30/2030 Projected Reserves 13,882,000$
* Council Mandated Reserve was $39.2M in FY2025, expected to be $44.9M on June 30, 2027 Upcoming Budget Adoptions
Staffing Summary
PROPOSED BUDGET FY 2026 -27
FY 2026-27 General Fund Additions
Organizational & Position Change Detail
90 Dept. Home Org Position Title Vacant/Filled Status FTE CIRO 220101 Communications & Interg’tl Relations Officer Filled (clean up) 1.00 PED 080302 City Planner Filled (clean up) 1.00
TPW 100303 Project Manager Vacant 1.00
Total General Fund
Additions 3.00
FY 2026-27 General Fund Reductions
Organizational & Position Change Detail
91 Dept. Home Org Position Title Vacant/Filled Status FTE HCS 110000 HCS Technician Vacant -1.00
HCS 110000 HCS Technician Limited Term Vacant -1.00
Rec 090206 Recreation Program Lead Filled -1.00
PED 080302 Senior Planner Vacant (clean up) -1.00
TPW 100403 Supervising Land Surveyor Vacant -1.00
TPW 100403 Associate Land Surveyor Vacant -1.00
TPW 100403 Assistant Land Surveyor Vacant -1.00
TPW 100100 Administrative Secretary Vacant -1.00
TPW 100303 Quality Control Associate Vacant -1.00
CIRO 220101 Chief Communications & Interg’tl Relations Officer Vacant (clean up) -1.00 Fire 060200 Firefighter Vacant -12.00
Fire 060200 Single Role Paramedic Filled -3.00
Fire 060200 Single Role Paramedic Vacant -3.00
Fire 060300 Community Outreach Specialist Vacant -1.00
Total General Fund
Reductions -29.00
FY 2026-27 General Fund Reorganizations
Organizational & Position Change Detail
92 Dept. Home Org Position Title FTE
PED various Parking Re-Org 28.00
Finance various Parking Re-Org -28.00
CMO 020100 CIRO Re-Org 7.00
CIRO 220101 CIRO Re-Org -7.00
Rec &
Parks Various Rec & Park Re-Org (mid-year) -69.55
Rec Various Rec & Park Re-Org (mid-year) 37.55
TPW Various Rec & Park Re-Org (mid-year) 32.00
Total Change Reorgs -
Total General Fund Position Changes -26.00
FY 2026-27 Non-General Fund
Organizational & Position Change Detail
Dept Home
Org Position Title Vacant/
Filled FTE
Rec 090401 Administrative Secretary Vacant -1.00
Rec 090401 Community Outreach Specialist Vacant -1.00
Total Non-General Fund Changes Recreation -2.00
Total General Fund Position Changes -26.00
Total General Fund and Non-General
Fund Position Changes -28.00
93 General Fund FTE Count by Fiscal Year
94 Questions?
May 6, 2026
PROPOSED BUDGET FY 2026 -27
Overview May 6, 2025
97 ➢ HCS – Housing Authority
➢ Internal Service Funds (HR/Risk Management, IT, Fleet) ➢ Enterprise Funds (Parking, Transit, Bennett Valley Golf Course) ➢ Santa Rosa Water
➢ Capital Improvement Program
➢ Year 2
HCS Housing Authority – by Fund
98 Dept. FY 25-26 FTE Change FY 26-27
HCS 22.90 (1.00) 21.90
Expenditures by Fund 2025-26 2026-27 $ %
(All Funds) Budget Budget Change Change
Mobile Home Rent Stabilization $316,946 $272,504 -$44,442 -14.0% Admin Housing & Community Services $1,746,191 $1,840,411 $94,220 5.4% Rental Assistance Programs $47,638,224 $49,469,497 $1,831,273 3.8% Housing Trust $7,271,443 $5,755,714 -$1,515,729 -20.8%
Total $56,972,804 $57,338,126 $365,322 0.6%
• Rental Assistance growth due to increasing rent
costs
• HOPWA funding shifting from City to State in FY
26/27
• Reduction of 1.0 FTE Limited Term vacant
Housing & Community Services Technician
Internal Service Funds
PROPOSED BUDGET FY 2026 -27
IT – by Fund
100
2025-26 2026-27 $ %
Expenditures by Fund Budget Budget Change Change
Information Technology $10,662,065 $11,538,374 $876,309 8.2% Technology Replacement $733,141 $699,046 ($34,095) -4.7% Total $11,395,206 $12,237,420* $842,214 7.4%
*2.12% of the overall proposed citywide budget for FY26-27 Dept. FY 25-26 FTE
Change FY 26-27
IT 33.00 - 33.00
• Accela software costs excluded from FY 2025-
26 Budget due to new billing cycle
• Contractual increases for Salaries, software
and licenses
HR – by Program
101
Expenditures by Program 2025-26
Budget
2026-27
Budget $ Change % Change
General Administration $4,363,705 $4,501,010 $137,305 3.1% Risk Management $45,660,743 $50,233,980 $4,573,237 10.0% Total $50,024,448 $54,734,990 $4,710,542 9.4%
Dept. FY 25-26 FTE
Change FY 26-27
IT 20.00 - 20.00
• Movement of 1.0 FTE from the General
Fund to the Risk Management ISF
Risk Management Programs
102
Risk Management Fund
2025-26
Budget
2026-27
Budget $ Change % Change
Administrative Staff and Supplies $2,277,719 $2,517,444 $239,725 10.5% City Health $15,112,475 $19,585,988 $4,473,513 29.6%
PERS Health $9,800,448 $10,045,150 $244,702 2.5%
Workers Compensation $6,040,211 $5,961,332 ($78,879) -1.3% Dental/Vision $2,054,319 $2,052,097 ($2,222) -0.1%
Other Employee Benefits $1,353,247 $1,470,082 $116,835 8.6% Liability Insurance $6,954,694 $7,032,155 $77,461 1.1%
Earthquake Insurance $667,630 $514,732 ($152,898) -22.9% Property/Fire Insurance $1,400,000 $1,055,000 ($345,000) -24.6% Total $45,660,743 $50,233,980 $4,573,237 10.0%
Fleet Services
103
Expenditures by Fund 2025-26 2026-27 $ %
(All Funds) Budget Budget Change Change
Equipment Repair Fund $8,468,218 $9,222,261 $754,043 8.9% Equipment Replacement Fund $15,554,465 $15,147,148 -$407,317 -2.6% Total $24,022,683 $24,369,409 $346,726 1.4%
• Contractual increases in Salaries and IT
costs
• Uncontrollable increases in vehicle parts
and materials
Dept. FY 25-26 FTE
Change FY 26-27
Fleet 26.00 - 26.00
Enterprise Funds
PROPOSED BUDGET FY 2026 -27
Transit Enterprise Funds
PROPOSED BUDGET FY 2026 -27
Transit - Budget Highlights
•
106
• Major operating revenue sources not keeping pace with costs • 70% of operating budget funded by sales tax-based revenues • Expense increases in FY27 driven largely by Salaries/Benefits and Fuel • No funds will be banked for bus replacement in FY27 (goal is $1M/year) • $1.3M from Transit Fund reserves programmed to balance budget • Reserves in acceptable shape but structural deficit on the horizon if key funding sources do not rebound
• Reserves include 15% operating reserve, capital project funds, and local match for state and federal grants
Transit Enterprise Fund Summary
107
FY 2026-27
Proposed Budget
Revenue $19,689,890*
Transfers In 30,000
Total $19,719,890
O&M Expenditures $19,719,890
Transfers Out 0
Total $19,719,890
Use of Fund Balance $0
* $1.3M from Transit TDA reserves programmed to balance budget.
Parking Enterprise Funds
PROPOSED BUDGET FY 2026 -27
Parking Enterprise Fund Summary
109
FY 2026-27
Proposed Budget
Revenue $3,740,831
Transfers In 1,927,099
Total $5,667,930
O&M Expenditures 6,359,426
CIP Expenditures -
Transfers Out 121,338
Total $6,480,764
Use of Reserves ($812,834)
Parking - Budget Highlights
110
• Contractual increases in Salaries, Fire and Earthquake Insurance and IT costs
• Increase in Non-permanent salaries to assist Parking Enforcement; offset by revenue
• Remaining fund reserves of ~$5M on June 30, 2026
Bennett Valley Golf Course
Enterprise Funds
PROPOSED BUDGET FY 2026 -27
Bennett Valley Golf Course Fund Summary
112
FY 2026-27
Proposed Budget
Revenue $187,460
Transfers In 500,000
Total Revenue & Transfers In $687,460
O&M Expenditures $573,893
Transfers Out 396,554
Total Expenditures & Transfers Out $970,447
Use of Reserves for Capital
Improvements ($282,987)
Water Enterprise Funds
PROPOSED BUDGET FY 2026 -27
Santa Rosa
Water
All Funds
General Fund, 0.33%
Utilities Admin Fund,
8.66%
Water Debt Svc, 0.33%
Water Utility Ops,
23.02%
Water Capital Fund,
7.49%
Storm Water
Enterprise, 0.61%Local WW Utility Fund,
7.53%Local WW Capital
Fund, 6.88%
Storm Water Creeks,
0.80%
Subregional Waste
Ops, 25.55%
CIP, 0.09%
Subregional Debt Svc,
13.71%
Subregional Waste
Capital, 5.01%
114
Water – Major budget Changes
• Capital Improvement Fund-Citywide increase of $156K due to Storm Water Drainage Improvements project.
• Water Funds increase of $3.7M mostly due to $2M increase in cost of water from Sonoma County Water Agency for purchase of water. • $600K increase in Water CIP project spending
115
Dept. FY 25-26 FTE Change FY 26-27
Water 282.00 - 282.00
Water – by Fund
116
*Other Funds comprised of Special Tax Districts.
Water – by Program
117
Water Enterprise Fund Summary
118
FY 2026-27
Proposed Budget
Revenue $64,285,639
Transfers In -
Total $64,285,639
O&M Expenditures 49,872,871
CIP Expenditures 16,000,000
Transfers Out 4,899,050
Total $70,771,921
Capital Spending ($6,486,282)
Local Wastewater Enterprise Fund Summary
119
FY 2026-27
Proposed Budget
Revenue $87,441,416
Transfers In -
Total $87,441,416
O&M Expenditures 16,058,647
CIP Expenditures 14,700,000
Transfers Out 63,670,433
Total $94,429,080
Capital Spending ($6,987,664)
Regional Enterprise Fund Summary
120
FY 2026-27
Proposed Budget
Partner Contributions $20,540,591
SRW Contributions 64,380,867
Miscellaneous Revenue 8,433,427
Total $93,354,885
O&M Expenditures 70,162,661
CIP Expenditures 10,700,000
Debt Service 13,711,620
Transfer Out 0
Total $94,574,281
Capital Spending ($1,219,396)
Storm Water Enterprise Fund Summary
121
FY 2026-27
Proposed Budget
Revenue $3,442,014
Transfers In -
Total $3,442,014
O&M Expenditures 3,650,912
Transfers Out 50,000
Total $3,700,912
Capital Spending ($258,898)
Citywide Capital Improvement
Program
PROPOSED BUDGET FY 2026 -27
CIP FY 2026-27 Funding Sources
123
City-Wide Total
$76,558,048
Regional- Bond Funded
$30,000,000
Wastewater
$12,730,000
Regional
$8,000,000
TPW- Special Funds
$16,693,771
TPW- Parks
$4,875,957
Water
$16,000,000
Local
$14,700,000
Subregional
$13,000,000
Fire
$607,836
Parks
$8,714,027
PED
$500,000
General Fund
$1,862,000
TPW-Special Funds
$19,463,109
Stormwater
$1,711,076
Fire Department Proposed CIP Budget
124
Fire Department CIP Budget Proposed Budget
New Fire Station – Kawana Springs – Capital Facilities Fees $272,668 Permanent Fire Station 11 Build – Capital Facilities Fees 272,668 Permanent Fire Station 11 Build – PSAP Tax 62,500
Total Fire Department Capital Projects $607,836
Water Department Proposed CIP Budget
125
Water Department CIP Budget Proposed Budget
Water Annual CIP $16,000,000
Wastewater Annual CIP 14,700,000
Regional Annual CIP 13,000,000
Storm Water & Creeks CIP 626,076
Total Water Department Capital Projects $44,326,076
Additional Storm Water & Creeks Gas Tax 675,000
Additional Storm Water & Creeks Enterprise & CFF 410,000 Water Proposed CIP Budget
126
Reservoirs
$4,000,000
Current FY26-27 Proposed
Master Plans and Studies $5,625,862 $2,247,000
New Projects - $500,000
In Design, Not Fully
Funded $13,481,279 $1,363,000
In Design, Fully Funded $22,955,726 $11,890,000
Projects in Construction $4,433,730 -
TOTAL $46,496,597 $16,000,000
Wastewater Proposed CIP Budget
127
Sewer
Trunks
$6,910,000
Sewer Mains &
Services
$5,795,000
Current FY26-27 Proposed
Master Plans and Studies $2,165,530 $1,499,000
New Projects - $845,000
In Design, Not Fully
Funded $2,859,126 $4,765,000
In Design, Fully Funded $9,808,068 $7,541,000
Projects in Construction $16,144,731 $50,000
TOTAL $30,977,455 $14,700,000
Regional Proposed CIP Budget
128
Plant Infrastructure-
Bond Funded
$30,000,000
Plant Infrastructure-
$5,500,000
Current FY26-27 Proposed
Master Plans and Studies $6,495,928 $1,550,000
New Projects - $500,000
In Design, Not Fully
Funded $2,950,646 $5,375,000
In Design, Fully Funded $2,815,717 $5,575,000
Projects in Construction $5,028,219 -
TOTAL $17,290,510 $13,000,000
Storm Water & Creeks Proposed CIP
Budget
129
Funding Sources:
• $495,000 Storm Water/Creek Enterprise
• $541,076 CFF – Storm Drainage/Sewer
• $675,000 Gas Tax – TPW
Current FY26-27
Proposed
Master Plans and Studies $689,758 $875,000
New Projects -- -
In Design, Not Fully Funded $380,495 -
In Design, Fully Funded $3,818,528 $836,076
Projects in Construction $1,560,452 -
TOTAL $6,449,233 $1,711,076
Park Development Impact Fee Zones
130
SW (Zone 2)
$2,720,842
NW (Zone 1)
$1,717,569
NE (Zone 3)
$1,436,493
SE (Zone 4)
$813,973
DT (Zone 3)
$343,140
DT (Zone 1)
$128,336
131
Parks Proposed CIP Budget
Dutch Flohr Park Grand Opening – Feb 2026
Project Description Proposed Budget
MLK Park Design/Build $4,381,058
Kawana Springs Community Park 2,275,000
Rincon Valley Park 1,336,493
Natural Play Area Renovation - Bayer 100,000
Fountaingrove Roadway Irrigation 100,000
South Davis Park 50,000
Downtown Parks Zone 1 128,336
Downtown Parks Zone 3 343,140
Total Parks Capital Projects $8,714,027
Kawana Springs Community Park
Transportation & Public Works
Funding Sources
132
Parks and Park
Amenities
$4,875,957
Funding Source Proposed Budget
Gas Taxes $8,945,070
Utility Impact Fee 4,188,616
Impact/Development Fees 3,426,149
Measure M/DD – Streets 2,903,274
General Fund 1,862,000
Total $21,325,109
Excludes $675,000 for Storm Water/Creeks
Excludes Parks Capital Projects
TPW FY 2026-27 CIP Appropriations
133
Total
$21,325,109 Pavement Maint.
$12,794,495BPOC
$3,400,000
Jennings Crossing
$2,850,000
ADA
$1,200,000
Pedestrian
$325,614
Misc.
$265,000
Bridge Repairs
$250,000 Bicycles
$240,000
Excludes $675,000 for Storm Water/Creeks
Excludes Parks Capital Projects
Pavement Maintenance
134
Pavement Maintenance
135
Pavement Condition Index (PCI)
136
1007050250
Failed Poor At Risk Good Newly
Constructed
Completely
Failed
48%17%26%9%
Pavement Condition Index (PCI)
137
% of roads in very poor
condition has doubled
in the last 5 years
Pavement Condition Index (PCI)
138
$7 SY
Slurry Seal
$52 SY
Overlay
$200 SY
Reconstruct
Current Network Condition
139
Residential with PCI below 25
◦ 44 centerline miles
◦ 809,898 square yards of surface area
◦ 3” mill and fill ($52/square yard)
◦ $42.1M
140
Questions?
Year 2 Potential Impacts
BUDGET PLANNING FY 2027 -28
Year 1 Recap
➢Year 1 (FY 2026-27):
➢Strategic Reserve Usage: Utilizing reserve funds partially to prevent major cuts to services
➢Adjusted staffing as grant funded programs now expired ➢Vacancy Management: Eliminating specific vacant positions to minimize impact on services
➢Innovative Financing: Pension cost smoothing through Fresh Start, major apparatus lease financing to match useful life of equipment ➢Targeted cost recovery improvements
142
Year 2 Challenges
➢The City is committed to transparency on services and program eliminations in Police, Fire, Recreation, Parks and Public Works that will impact the community without revenue enhancements
➢Despite major corrective action, the deficit is expected to grow to $13.8M by FY 2029-30
➢General Fund is now at the bottom of Great Recession level of staffing ➢Sales Tax Revenue Measure Q expires in FY 2030-31; $25M of ongoing revenue will be discontinued
143
Year 2 Challenges
➢With a $13.8M projected deficit, General Fund departments were directed by the City Manager to develop the required reductions to balance the budget ➢The General Fund projects a 59.2 FTE reduction and would result in major impacts to core services
➢Community impacts from core service reductions are additionally strained from deferred maintenance on City infrastructure that remains unfunded 144
Department Reductions
145
Department Proposed Budget
Reduction FTE Count
Police 4,308,598$ (16.0)
Fire 3,573,720 (5.0)
TPW 2,275,305 (18.0)
PED 1,115,002 (6.5)
IT 708,861 (3.0)
Finance 646,473 (4.6)
Rec 506,967 (3.1)
Human Resources 262,418 (1.0)
City Attorneys Office 215,368 (1.0)
HCS 209,479 (1.0)
Total 13,822,191$ (59.2)
Year 2 Service Impacts
Public Safety Impacts:
➢Black Out of a 4-0 Truck company
➢Impacts to call response times and core fire suppression readiness ➢Elimination or consolidation of Police special units
➢Impacts to Gangs, Narcotics, Traffic, Downtown Enforcement and SET teams Recreation:
➢Elimination of Adult softball league and other recreation programs 146
Year 2 Service Impacts
Public Works:
➢Significant reduction of proactive and responsive maintenance ➢Streets and road repair
➢Parks maintenance
➢Street lighting and traffic poles
Additional Impacts:
➢Slowed planning and permit delivery
➢Elimination of Community Promotions programs
➢Critical reduction of cybersecurity
147
148
Questions?