Southgate warns of an $8M-$9M budget gap; council weighs utility users tax and cuts as residents plead to save youth programs

The Southgate City Council on Nov. 11 received a detailed presentation on the city's fiscal outlook that framed a looming structural deficit and outlined revenue and cut options as staff and council prepare two alternate budgets and possible ballot measures.

City Manager Rob Houston and Finance Director Louis told the council the FY2526#x2013;26 budget had been balanced using one-time reserves and ARPA dollars, but operating costs are rising faster than revenues. "Absent any changes in revenue, the deficit's projected to be between $8,000,000 and $9,400,000 in fiscal year 26-27," Finance Director Louis said, calling the problem "in the millions" against an $80 million general fund.

Why it matters: the general fund pays core services — the finance presentation showed policing consumes roughly 55.6 percent of general-fund spending, parks and recreation about 16.5 percent — so broad cuts would affect public safety, parks, recreation and front-line services. Staff said closing the gap would require either roughly $10 million in new annual revenue or deep, targeted reductions to operations and programs.

Options on the table: staff outlined a menu of possibilities. Shorter-term, staff can reassess a…