The City of Sacramento has released its proposed budget for Fiscal Year 2026/27, outlining a balanced plan that closes a $66.2 million General Fund gap while maintaining core services and advancing City Council priorities.
The proposed budget totals $1.7 billion across all funds, including an $898.3 million General Fund, and supports approximately 4,822 full-time equivalent positions.
City officials continue to address a structural budget deficit, where ongoing expenses are growing faster than revenues. This imbalance is not the result of an economic downturn but reflects increased service demands, inflation and reduced state funding for homelessness programs.
To close the gap, the proposed budget uses a combination of ongoing and one-time strategies, including expenditure reductions, revenue adjustments and funding shifts. Approximately 75% of the budget balancing solutions are ongoing, aimed at improving long-term financial stability.
“This proposed budget reflects months of work to address a structural deficit that cannot be solved with one-time fixes,” said City Manager Maraskeshia Smith. “It makes difficult but necessary decisions to align our ongoing costs with available revenues, while continuing to deliver core services and strengthen the City’s long-term financial stability.”
The budget builds on work that began earlier this year, including Early Budget Work Sessions held in March. During those sessions, departments presented reduction strategies and potential service impacts as part of a baseline balancing plan.
Based on feedback from the City Council and community, the proposed budget restores several reductions identified in the March baseline. These include the Police Department Magnet Academy, partial restoration of Fire suppression vacancies, park maintenance services, and programs in Youth, Parks, & Community Enrichment.
The proposed budget also reflects changes to previously considered revenue options. The City is not moving forward with parking meter rate increases and residential parking permit charges. These items appear in the proposed budget document but are not included in the final proposal, as the changes were made after it was sent to print.
Even with the restorations, reductions are still required to close the budget gap. The proposed budget includes the elimination of 46.1 filled full-time equivalent positions, in addition to vacant positions, as part of the overall balancing strategy.
Not all filled position eliminations will result in an employee being separated from the City as some impacted employees may move into other available positions. No sworn police or fire personnel will be separated from the City as a result of budget balancing.
The budget maintains a focus on City Council priorities — economic development, homelessness and public safety — while continuing to deliver core services.
Key investments include the creation of a new Economic Development Department, continued homelessness outreach and shelter expansion, and maintaining sworn police and fire staffing levels. The City is also maintaining its investments in the FUEL Network and RydeFree RT.
The City continues to face economic uncertainty, including inflation, potential recession risks and long-term financial challenges such as unfunded pension liabilities and deferred infrastructure needs.
The City will now enter the public review process, with City Council budget hearings scheduled throughout May and final adoption expected June 9.
Key dates include:
- April 29: Release of the proposed budget
- May 5: Budget overview and deliberations
- May 12: Continued hearings and Council direction
- June 9: Final budget adoption
Those interested in participating in the budget development process can attend public meetings, submit e-comments, and contact the Mayor or their Councilmember.
For more information on the proposed budget, visit the City’s website here.
