South Pasadena workshop trims capital lines, staff recommends 5.8148 maximum millage for July notice

South Pasadena city leaders spent a workshop reviewing the draft fiscal 2026–27 budget and agreed to remove or delay several capital items while directing staff to publish a preliminary maximum millage of 5.8148 for the July 1 notice.

The workshop produced immediate consensus to remove a proposed $30,000 strategic review for the fire department from this year’s budget and to eliminate or defer a number of nonessential capital expenditures. Commissioners discussed cutting the $250,000 paving line entirely, removing $15,000 in exercise equipment, and deferring a $50,000 kayak launch unless grant funding is secured. Staff reported the first fee-study bid returned at $35,000, above the $20,000 placeholder in the draft budget.

Why it matters: commissioners said they want to show taxpayers proactive restraint given uncertainty from a pending property-tax constitutional amendment and recent storm-related costs that reduced reserves. Staff estimated a potential first-year revenue shortfall of about $820,000 if the amendment reduces taxable revenues; the city’s operating cost was described at roughly $729,000 per month and reserves at about six to seven months.

Key budget adjustments and decisions

- Fire department strategic study: commissioners agreed to remove the $30,000 line now and revisit it after a new chief is in place. - Road paving: several members urged eliminating the $250,000 paving allocation for the coming year and instead handling repairs as needed. - Kayak launch and exercise equipment: the kayak launch funding was deferred and exercise equipment removed as a nonessential item; commissioners directed staff to pursue grants for the kayak project. - Street lights and beautification: the line for solar street-light repairs was reduced from $20,000 to $10,000, and the contingency for beautification was discussed for a possible cut or reduction. - Library card subsidy: the commission moved toward a 50/50 subsidy for county library cards (city pays $50), effective Oct. 1; staff will verify historical participation and revenue figures before finalizing.

Staff presentation on millage and timeline

City staff reviewed estimated taxable values and a new state legislative change affecting rollback calculations. Because state forms and methods are still being updated, staff recommended publishing a maximum millage at 110% of rollback (5.8148) for the July 1 trim-notice process so the commission preserves the option to lower the rate at subsequent hearings but cannot later raise it above the published maximum. As staff put it during the workshop, given the legislative timing "it feels like a fire drill." Staff emphasized certified values expected the week before July 1 could change the precise adopted rate, and any final action will occur at subsequent public hearings.

Process and next steps

The commission directed staff to prepare the agenda packet for the July 1 meeting with the 5.8148 maximum millage included and to return with final certified taxable values and any revised calculations. Staff will also provide updated budget exhibits showing the effect of the proposed cuts and the alternate revenue assumption (96% versus 97.5% of ad valorem collection) requested by one commissioner. Several line items removed or deferred will be reflected as budget edits in the next packet.

No formal roll-call votes occurred during the workshop; decisions were recorded as consensus to remove or defer the listed items and to publish the recommended maximum millage in the July 1 materials. The commission scheduled the formal tentative millage action and additional budget hearings for the July and September calendar as required by state notice deadlines.

What was not decided or remains uncertain

Commissioners and staff noted several open items: the exact certified taxable value that will determine the final adopted millage, the final cost and scope for any fee studies or HVAC work, and insurance settlement details tied to storm damage assessments. Staff will report back with updated numbers and supporting spreadsheets at the July 1 meeting.