Council hears FY27 budget presentations: staff identifies $3.2M structural deficit and outlines 10% reduction scenarios

City staff presented the FY27 budget overview and a program of reductions and revenue strategies to address a structural deficit of approximately $3.2 million.

Directors explained the operational consequences of a 10% reduction scenario for each department: the police chief said significant overtime and specialized units (traffic, crime impact team) could be curtailed under deeper cuts and warned of longer response times if sworn staffing were frozen; public works described deferred maintenance and contract risks; parks & recreation and community development described revenue shortfalls for events and the need to accelerate permitting automation to improve cost recovery. Several departments emphasized that many core services are legally or operationally required and that cuts mainly reduce responsiveness and capacity rather than discretionary activity.

Staff identified revenue and efficiency options to explore further: adjustments to the TOT program and STR tax collection, revisiting the lighting and landscaping district assessments, expanding paid parking/dynamic pricing and enforcement (including ALPR), updating user and permit fees, digitizing permitting and recreation reservations, and seeking grant or partner funding for specific capital items (e.g., dog‑park predevelopment if council directs). Council asked for a deeper breakdown of overtime drivers and possible reimbursement gaps (special events, mutual aid) and directed staff to return on May 26 with more detailed revenue proposals and CIP implications.

The presentation was received and filed for further consideration; no final cuts or new revenues were adopted at the May 12 hearing.