Santa Monica council adopts FY26–27 budget and refocuses capital program

Santa Monica’s City Council voted unanimously to adopt the fiscal year 2026–27 operating and capital budgets, moving recurring maintenance, fleet and technology replacements back into the operating budget and redirecting the capital improvement program (CIP) to deliver long‑deferred projects.

The adopted package, presented by the city’s finance director, aligns the CIP to fund major projects including Memorial Park redevelopment, pier infrastructure upgrades for LA28 and the Paralaympics, renewal of the Camera Obscura building at the Main Library, and park and mobility investments across the city. Finance staff described the change as a deliberate realignment: returning recurring costs to the operating budget restores the CIP’s focus on capital work and allows larger projects to proceed without being absorbed by maintenance expenses.

Why it matters: Council and staff said the shift makes the CIP more deliverable after years when maintenance, technology and fleet replacements crowded the capital program. The fiscal package also includes three non‑general‑fund timing adjustments—moving a grant‑funded neighborhood greenway project forward and accelerating transit priority work ahead of LA28—changes staff said do not affect the general fund.

The council debated a related set of fee updates before the vote, with particular attention on aquatics fees. Recreation staff said aquatic programs have been intentionally kept below full cost‑recovery to preserve access and that modest increases (roughly 4% for some permit groups) would move adult permit cost recovery from about 58% to roughly 62%. The department told council those adjustments are intended to be measured, preserve resident discounts and protect youth access while narrowing a multi‑year gap between operating cost growth and fee revenue.

Council members also asked senior staff about monitoring and transparency: finance and department directors described plans to publish zip‑code and program metrics, track outcomes for CIP and program investments, and develop community and business surveys to measure whether residents and merchants feel the intended benefits over time.

What’s next: The council adopted the resolutions that finalize the FY26–27 operating and CIP budgets and associated annual fee and salary resolutions. Staff will publish final budget documents and post periodic outcome metrics for council and public review.