City Council reviews 2526 proposed budget addressing $35.6M shortfall

The San Jose City Council convened on May 7, 2025, for a budget study session aimed at reviewing the proposed operating budget for the fiscal year 2025-2026. Mayor Sam Liccardo opened the meeting by expressing gratitude to city staff for their hard work in preparing the budget, emphasizing the importance of effective financial management in addressing the city's needs.

City Manager Jennifer Maguire presented the proposed budget, highlighting its fiscal responsibility and alignment with the council's objectives. The budget addresses a projected shortfall of $35.6 million in the general fund, which represents 3% of the overall budget. Maguire noted that decisive action is necessary to ensure a balanced budget, especially in light of an anticipated additional shortfall of $52.9 million for the following fiscal year.

Maguire assured the council that the proposed budget includes targeted strategic spending while minimizing impacts on the community and city employees. She stated that fewer than 15 positions would be affected by the budget adjustments, with no layoffs for employees entitled to other positions.

The council was encouraged to engage with department staff during the study sessions, which will continue over the next week, to gain a deeper understanding of the budget's components, including service levels and performance measures. The meeting underscored the city's commitment to navigating financial challenges while prioritizing essential services and community needs.