Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the City Budget topic
No spam. Unsubscribe anytime.
Santa Rosa adopts FY 2026–27 budget; staff warns larger cuts likely without new revenue
Summary
Council adopted the city's FY 2026–27 operating and CIP budgets after staff outlined a two‑year strategy that uses $7.8M of reserves in year one and would require more severe staffing and service cuts in year two if new revenues are not found.
The Santa Rosa City Council adopted the city's fiscal year 2026–27 operations and capital improvement program budgets after a full study‑session presentation of revenue projections, department consolidations and proposed savings.
Scott Wagner, the city's chief financial officer, told the council the proposed budget for 2026–27 still leaves a near‑term gap that staff will offset with $7.8 million in reserves but that structural pressures remain. "Ultimately, the budget that we are proposing today will actually have a deficit of 7,800,000 and require $7,800,000 use of reserves," Wagner said. He listed nearly $10 million in year‑one solutions — including vacancy eliminations, a pension stabilization strategy and other efficiencies — but said year two will be the more difficult fiscal test.
Staff described a multi‑pronged approach that combined cuts, one‑time reserve uses and a pension 'fresh start' program that staff projects will yield substantial long‑term savings. Veronica Connor, the budget manager, said the general fund still depends heavily on property and sales tax revenue and that Santa Rosa's revenue mix leaves the city more sales‑tax dependent than similar agencies.
As an illustration of what could be required in a no‑revenue scenario, staff presented department‑level examples for year two that would reach much deeper: they said the council would face potential reductions of 42 positions in 2027 and up to 92 positions over time in a structural remedy. Staff singled out potential service impacts that would follow significant cuts in public safety (police and fire), parks maintenance and streets programs.
Council members pressed staff on specifics: where cuts would fall, whether salary freezes or alternative revenue measures (local sales tax enhancements or bonds for streets) could be pursued and what the timeline for decisions would be. Staff urged that the year‑two plan be paired with an aggressive program to identify new local revenue options — including a possible local sales tax measure to fund ongoing city services and, if approved, provide a revenue base capable of supporting capital financing such as a streets bond.
Council action: After public comment, council adopted the budget and related resolutions (including direction to assign $4.5 million of reserves for critical facility needs) on recorded votes; one procedural vote on transportation and public‑works staffing saw Councilmember McDonald recuse for a separate item.
Why it matters: Staff said the city had already reduced general‑fund spending by roughly $25 million and eliminated about 80 full‑time positions over recent years; without new revenue, officials said the city will again be forced to choose between deep service cuts and tax measures to replace long‑term structural revenue shortfalls.
Ending: Staff will return with year‑two options and continue work on reserve policy, pension implementation and potential revenue measures for council consideration this year.
Speakers quoted: Scott Wagner (Chief Financial Officer); Veronica Connor (Budget Manager); Mayor Mark Stapp.
