Santa Barbara council hears budget preview as city weighs Measure I dollars, reserves and federal funding risks

Summary

City officials outlined the fiscal 2026–27 budget outlook at a March 4 work session, flagging pension costs, the new Measure I sales tax, limited Measure C capital capacity, and uncertain federal grants as key variables. Staff recommended using a multi-year planning approach and preserving reserves while programming new revenues.

City of Santa Barbara officials presented a draft multi-year outlook and department priorities March 4 as the council began formal budget season for fiscal years 2026–27.

City Administrator Jan McAdoo framed the work session by flagging two near-term funding uncertainties: federal holds on two previously announced grants (about $1.0 million each for a library project and a public safety radio upgrade) and possible reductions in federal Community Development Block Grant funding. "One of the key things we're grappling with right now is the uncertainty with the federal budget," McAdoo said, urging caution in programming one-time funds.

Finance Director Keith DeMartini walked the council through a five-year general fund forecast showing revenue growth tempered by faster-rising expenditures. "You can see that we still have budgetary challenges," DeMartini said, noting structural pressures including pension contributions, healthcare, and inflation. The presentation showed general fund expenditures growing from roughly $196 million in recent years to about $242 million in the outer forecast year, producing tighter reserve needs.

Budget staff reiterated priorities for the new Measure I 0.5 percent sales tax,…

Santa Barbara council hears budget preview as city weighs Measure I dollars, reserves and federal funding risks

Summary

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