Fiscal Year 2025- 2026 Recommended Budget

Prioritizing Efficiency Balancing this budget was not easy. It required tough conversations and thoughtful tradeoffs. I’m proud of how our staff and departments have risen to the challenge—focusing on outcomes, stewardship, and smart prioritization. We asked every department to review their operations critically—evaluating staffing, project timing, and service delivery—so that we could maximize the value of every dollar. We took a close look at ongoing expenditures and rising costs. This year’s budget addresses $12.8 million in increased expenditures necessary to maintain existing service levels, what could be considered the “costs of doing business”. These include increased expenses for contracted services, utilities, technology, employee benefits, and other areas where inflation, service demands, or market conditions have driven up prices. These are not enhancements or new initiatives—they are the necessary to sustain the services residents and businesses rely on every day. Contracted support is necessary across the organization in many core services, and almost all have experienced recent increases. Transit operations, solid waste disposal, and even reciprocal response agreements with local fire districts are projected to cost more in the upcoming budget, and must be budgeted accordingly. Expected increases include $1.8 million to support the Police Department’s Records Management System and Axon contracts, a $1.5 million increase in the Transit operations management contract, and additional costs for smaller but essential services such as mowing, facility security, and general maintenance. Equipment, program supplies, and utilities continue to see impacts from inflation and availability. Street lighting alone is expected to increase nearly $1.4 million. Retirement and employer health premiums also are expected to increase by approximately by $3.5 million. The employer contribution rate for general employees is now over 14%, more than twice the employee contribution rate. In addition to targeted reductions and cost-saving measures, this year’s budget includes a series of strategic organizational realignments that added $2.2 million and 12.5 FTEs. These changes are not merely administrative— they reflect a deliberate investment in strengthening internal coordination, improving accountability, and enhancing service delivery across key functions. We established the new Department of Community Safety, a major structural shift that brings together existing public safety alternatives and community services under one unified leadership. This department is focused on proactive, community-based strategies—including the Behavioral Health Response (BHRT) and Law Enforcement Assisted Diversion (LEAD) teams, and homelessness interventions—that complement traditional emergency services while connecting those in need with the resources needed, reducing demand on police and fire. We also moved key planning and administrative positions from the Nussbaum Housing Partnership Fund into the General Fund. This change enhances visibility and integration of our housing work within the City’s broader policy and budget framework, while maintaining a dedicated focus on affordable housing investments and neighborhood revitalization within the Nussbaum Fund. Our Transit Department has also undergone restructuring to better support service planning, operations, and customer experience, especially as we prepare for continued regional transit collaboration and investments in mobility infrastructure. Several other departmental reorganizations reflect our commitment to streamline operations, improve accountability, and elevate impact. Code Enforcement and Community Relations functions were moved under the Executive Department, centralizing oversight of key compliance and community engagement efforts. Parking Enforcement was transitioned to the Police Department, aligning enforcement functions with public safety operations for improved coordination and responsiveness. The Minority/Women’s Business Enterprise (M/WBE) Office was realigned under the City Attorney’s Office to strengthen its role in expanding economic opportunity and advancing the City’s commitment to inclusive procurement and business development. Belonging and Engagement functions were moved to the Human Rights Department, enhancing the City’s capacity to lead equity-focused initiatives and foster inclusive community partnerships. Finally, we completed the full realignment of the Solid Waste and Recycling Department, consolidating over 120 staff across multiple divisions. This effort strengthens accountability, improves routing and staffing efficiency, and better positions the department to meet service expectations, particularly in waste collection and sustainability programming.

Recommended FY 25-26 Budget