Finance committee reviews FY25 second-quarter finances, flags ongoing deficits and downtown parking shortfall

Santa Barbara City Finance Committee Chair Friedman on Feb. 25 received the city’s second-quarter financial review for fiscal year 2025 from Finance Director Keith DeMartini and the city controller.

DeMartini told the committee that after six months of actual data staff projects the general fund will end FY25 with an approximately $7.2 million deficit, improved from a budgeted $9.9 million shortfall that assumed a $3.2 million contribution to reserves. “When you include … our reserve policy, you will see that we have had operating deficits for the last couple of years, and we are projected to do so again in fiscal year 2025,” DeMartini said.

The presentation included the staff multiyear forecast showing a continuing structural imbalance but a one-year improvement in FY26 tied to Measure I, the voter-approved sales tax increase. DeMartini said the FY25 projection includes three months of Measure I revenue and that FY26 shows a projected $3.3 million surplus driven by a full year of that revenue. He…