Finance Committee - August 25, 2026

The City of Santa Barbara Finance Committee met on August 25, 2026, to discuss the city's reserve policies and operational sustainability initiatives, with a focus on budget management and funding for the local housing trust fund. The committee reviewed the current status of the general fund reserves, noting that reserves are below policy targets and projected deficits will require use of reserves unless revenue increases or expenditure controls are implemented. Staff presented options for replenishing reserves, including revenue enhancements such as audits of digital streaming services and hotels, and expenditure controls. The committee also discussed potential funding sources for the local housing trust fund, including allocations from Measure C and Measure I sales tax revenues, in-lieu fees, and possible new revenue measures like a vacancy tax and transient occupancy tax increases. Public comments emphasized the need for permanent, recurring funding for affordable housing and cautioned against certain taxes due to legal and economic concerns. The committee expressed support for clearer reserve policy language, prioritizing replenishment of disaster reserves, and exploring revenue options in collaboration with community and business partners. No formal votes were recorded, but there was consensus to revise reserve policy language for clarity and to include provisions for surplus allocations to the housing trust fund.