Santa Maria officials warn of $25 million shortfall; hiring chill and service reviews announced
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Summary
City Manager David Rowlands told attendees the city faces a $25 million gap in the general fund and Measure U budgets and is implementing a hiring chill while department directors and council evaluate service-level options.
City Manager David Rowlands told the State of the City audience that the City of Santa Maria faces a $25,000,000 budget shortfall in its combined general fund and Measure U budgets and is beginning a process of service-level reviews and controlled hiring.
The shortfall was disclosed as part of the city’s adopted $408,000,000 total budget for fiscal 2025; the general fund plus Measure U portion totals $148,000,000. Rowlands said the $25 million represents roughly 17% of that combined general fund/Measure U amount and that city leaders will begin work now to resolve the gap before the next fiscal year begins July 1, 2026.
The announcement follows earlier remarks from Mayor Alice Patino that “we must solve our budget challenge of expenses outpacing our revenues.” Rowlands acknowledged the city is “overextended” and said the council and department heads are evaluating options to protect core services.
Rowlands described immediate personnel-management steps the city is taking: a hiring chill that requires a written justification and analysis before any vacancy may be filled, and a review to identify only those positions deemed critical to perform essential functions. He said service levels remain intact for now while the analysis proceeds.
Public safety is a central budget priority, Rowlands said, receiving 59% of the combined general fund and Measure U appropriations — about $88,000,000 — to cover police, fire, city rangers and code enforcement. He said the council, city manager and department directors are “looking at service levels and options” and will only “fill positions identified as critical need.”
City leaders did not announce specific reductions, layoffs, or program eliminations at the State of the City address. Rowlands said the city will pursue efficiencies and engage with department leadership to identify options that preserve essential services while addressing the structural funding gap.
Next steps outlined by staff include department-level analyses, continued monitoring of revenues and expenditures, and reporting back to the council during the budget calendar for the fiscal year starting July 1, 2026.
