Published on July 22, 2026
Dear community,
I want to share an update with you about the financial health of our City. As your Mayor, it is prudent to be transparent and clear with our community members about our City’s financial standing as we look ahead to the 2027-2028 biennial budget.
During my State of the City earlier this year, I laid out how our City would address the looming 2026 budget deficit. Given the financial information available to our leadership at the time, we seemed to be on the path to eliminate the deficit for 2026.
Yesterday, my team notified the Finance Committee that the financial information available to me in March regarding the City’s general fund did not reflect the City’s true financial standing. Because of the work by Assistant City Administrator Monisha Harrell and former Interim Finance Director Sandra Fujioka, it is now clear that the City’s deficit is more significant than previously reported, primarily due to longstanding deficiencies in financial systems and processes.
Following this discovery, we have taken immediate action to minimize the deficit’s impact on the next biennium. I have instructed our directors to take a critical look at their budgets to determine how to reduce expenditures while maintaining critical services. We are reviewing our contracts and possible redundancies to be more efficient. We are also revising our internal processes to improve tracking to provide more clarity and certainty. Towards the end of 2025 and throughout 2026, the City has already implemented additional initiatives and cost-saving measures to slow spending; these shifts will take time to reap those benefits, and we are already seeing improvements.
As financial stewards of the City and its resources, it is important that we keep everyone informed about our progress. We will provide regular updates to the Council Finance Committee, and on Tuesday, September 8th, there will be a Budget Summit with the entire City Council. At that meeting, we will provide the most up-to-date information as our financial future comes into sharper focus.
We are solutions-focused and actively working to improve our systems and processes.
Thank you.
Mayor George Hurst