City officials warn of large midyear shortfall; recommend $76 million in cuts and $190 million in solutions

City officials presented a midyear financial report to the City Council Budget and Finance Committee on Feb. 18, saying the city faces a larger-than-expected revenue shortfall and will need reductions and other measures to preserve reserves.

The city’s CEO presentation, delivered by the official identified in the meeting as Señor Sable, told the committee that year-to-date receipts are trailing the adopted plan and that the city is missing roughly $13 million in anticipated revenue in the current period. The presentation said projections based on current trends could put the city more than $100 million below the adopted budget by year end and raised a four-year shortfall scenario that would reach several hundreds of millions of dollars if current patterns persist.

The report recommended an initial package of roughly $190 million in solutions and adjustments to protect the city’s reserves. That package included balance and reconciliation actions and proposed $76 million in targeted midyear reductions developed with departments, the presentation said. Officials described the $190 million as an opening set of solutions and told the committee larger, more consequential actions will likely be necessary in the next budget cycle if revenue declines continue.

Why it matters: committee members were repeatedly told that maintaining a prudent reserve level requires immediate steps. The CEO’s office said the reserve level is approaching the city’s emergency threshold and that without near-term actions the city could face “difficult and painful” choices when constructing the fiscal 2025‑26 budget.

Key details from the presentation included the following numbers, as stated at the meeting: the city has realized…