Mayor presenting draft budget to city council that includes layoffs, cuts to service hours

On Monday, San Diego mayor Todd Gloria will present a "draft" city budget for Fiscal Year 2026 to the city council that includes $157 million in new revenue partly composed of increased fees, but also cuts to libraries and recreation centers.

Gloria's budget includes net increases for both the San Diego Police Department and Fire-Rescue Department, $29.3 million for the former and $24 million for the latter.

"We are proud that public safety continues to remain of the highest importance to Mayor Gloria's administration," Fire Chief Robert Logan II said earlier this month when the budget was first released

Police Chief Scott Wahl said at the time the budget "reflects the difficult but necessary choices required to meet this unprecedented moment without compromising the key services our communities rely on."

The $6.04 billion is actually an increase of $223.1 million over FY 2025.

Other highlights of the preliminary budget include:

• The closure of all libraries on Sundays and Mondays, and a reduction of a library tutoring program from 18 to 10 libraries
• The reduction of all recreation center hours from 60 hours per week to 40 hours per week and the closure of select restrooms in city parks on a seasonal basis
• $36.3 million for slurry/cape/scrub seal maintenance road resurfacing and $46.8 million for full road resurfacing for a total of $83.1 million covering nearly 390 lane miles of streets
• $48.8 million for stormwater upgrades, including $39.1 million for emergency projects and $9.7 million in flood resilience infrastructure
• A renegotiation of the city's animal services contract to reduce costs
• An anticipated $11 million in new revenue associated with proposed parking fees generated in Balboa Park

Additionally, the budget includes a total investment in homelessness services of $105.3 million, with $71.1 million coming from the General Fund, $25.7 million from the state's Homeless Housing Assistance and Prevention program, and $8.5 million in other grants.

The city will back away from the Rosecrans bridge shelter due to county plans to demolish an adjacent building and cut utilities.

The city, which said it would close select restrooms in city parks on a seasonal basis, said that it would be funding "non-personnel expenditures to provide portable restroom facilities in downtown," as part of its homelessness and housing program.

"With the original [memorandum of agreement] set to expire in July, county officials had been in talks with the city to develop an updated agreement to extend the shelter's life by an additional four years," according to a statement from County Supervisor Terra Lawson-Remer's office. "Despite the county's continued interest in partnership, the city has signaled its intention to withdraw from the agreement -- ending its role in operating the shelter."

Lawson-Remer called on philanthropic donations to "support the construction of dedicated utility infrastructure," with an estimated cost of up to $2 million for new water, sewer, fire main and electrical hookups to allow the shelter to continue to receive county-funded utilities and operate without interruption.

In November's election, voters declined the San Diego Transaction and Use Tax, which would have increased the tax on transactions in the city by 1%, bringing the total sales tax to 8.75%. The current rate of 7.75% leaves the city tied for the 4th-lowest of the state's 482 municipalities and lower than 9 of the county's 18 cities, according to the California Department of Tax and Fee Administration.

The additional $400 million that would have been raised by the proposal was a key emphasis of the measure's proponents, but the other side of that issue -- the cuts that would need to be made if it were not passed -- was less frequently referenced.

The draft budget released Tuesday includes a "right-sizing" of fees, such as doubled parking meter rates, increased parking-citation penalties and an increase for various service fees across the city. Gloria is also relying on a new fee to collect solid waste, which will be decided in June by the City Council, and on an increase to the city's hotel tax.

That latter tax, Measure C, was approved by a simple majority of San Diego voters in 2020, but it needed two-thirds of the vote to pass. San Diego decided the two-thirds rule was unfair and has moved forward with the intent to collect the tax beginning May 1, but the issue remains tied up in court.=

Gloria proposes cutting 393 positions -- 160 of which are currently filled -- and transferring many of these employees to other departments. The draft budget proposes $175.9 million in reductions across all city departments.

"I see Mayor Gloria's draft as a good-faith attempt to respond to the concerns shared amongst our council colleagues," Councilman Stephen Whitburn said earlier this month. "As elected officials we are relied upon not only to maintain the city's duty to serve the public but also to concurrently protect the jobs of the hard-working members of the city's workforce."

The city council, serving as the Budget Review Committee, will hold a series of hearings from May 5-9. Following that, Gloria will release his revised, official budget proposal on May 14.

"What we are putting forward at this time is a balanced, draft budget grounded in our economic reality," Gloria said. "It will continue to keep our neighborhoods safe, remains focused on reducing homelessness and fixing our infrastructure, and largely protects core city services that our residents count on.

"With the economic data we have now, we've made strategic decisions to minimize service-level reductions, avoid mass layoffs of the workers who keep our city operating, and invest in what matters most to San Diegans," the mayor added.

In December, Gloria announced that San Diego was facing a $258 million budget deficit in the next fiscal year "amid declining growth in property, hotel room and sales taxes," a statement from his office read.

That deficit then continued to grow because of a decrease in sales-tax revenue, lower-than-anticipated franchise fees from San Diego Gas & Electric and an increase in employee pension costs.