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Santa Ana staff outline $13 million gap; council weighs cuts, revenue options and land purchase for Washington Square park
Summary
Finance staff reported a $13 million budget shortfall after updated revenue and expenditure estimates; council discussed $8.4 million of balancing measures, a remaining $4.7 million recurring gap, potential one‑time uses, and whether to use scarce one‑time funds to acquire land for a Washington Square park.
Santa Ana officials presented an updated fiscal outlook at a council work study on May 10 that showed recurring revenues of about $425 million against baseline spending of roughly $438 million, producing an estimated structural deficit of about $13 million.
Finance Director Alex Silva told the council staff had identified approximately $8.4 million in balancing options — including revenue adjustments, workforce changes and contract reductions — that reduce the remaining recurring shortfall to about $4.7 million. "Total recurring revenues are approximately $425 million compared to spending a baseline of about $438 million, resulting in an estimated deficit of $13,000,000," Silva said.
Staff also outlined one‑time general fund resources of roughly $9.4 million available after reserve adjustments, of which about $3 million remained for council priorities. Potential one‑time uses included park restrooms, stadium improvements, and acquisition of a vacant parcel in Washington Square to create a neighborhood park. Mayor Mesquah and several council members urged creative approaches; Mayor Pro Tem Penalosa suggested land swaps to reduce cash outlay.
Councilmembers debated tradeoffs between one‑time purchases and recurring costs. Councilmember Fan warned that a $4 million land purchase for Washington Square would exceed the available one‑time pool and add ongoing maintenance costs. Several members, including Councilmember Vasquez and Mayor Pro Tem Penalosa, expressed support for pursuing acquisition options because parcels can be lost permanently if not secured.
Revenue proposals presented by staff included aligning paramedic transport rates with regional levels (estimated at about $700,000 annually), a technology fee on permits (preliminary estimate $700,000–$800,000), and a stadium fee increase (approximately $300,000). The city’s transient‑occupancy tax (TOT) currently generates about $9.5 million annually; staff noted any TOT increase would require voter approval.
Council directed staff to refine balancing measures, provide program‑level per‑capita analyses for youth services and PAL programming, and return with options for closing the remaining recurring gap ahead of the June budget readings.
