Santa Monica adopts FY 26–27 budget package
The City Council approved the operating and capital budgets, then split off a separate $20,000 SMMUSD grad night vote because of a recusal.
Two hosts walk through the week’s edition in conversation — adopt fy 26–27 operating and cip, approval of 2026–27 transportation services plan, and what’s coming next. Generated by Aware, from this week’s verified summaries.
One vote set the city’s main spending plan for FY 26–27, while a separate school funding transfer had to wait for a recused councilmember.
The year’s spending plan landed in one vote. Santa Monica City Council adopted the FY 26–27 operating budget and capital improvement program budget, along with the related annual resolutions and actions in item 12A. The motion passed unanimously among those voting. During the discussion, the package was amended to add language to an attachment dealing with franchise-holding utilities and existing agreements.
That added language came from the City Attorney’s office and was read into the record after a brief correction. One councilmember used the budget item to flag two issues for later review: landmarking fees, which they said should be revisited as part of a broader look at the landmarking program, and fines for parking and traffic violations. The councilmember pointed to examples including a 350 violation for forged disabled parking placards and a 100 penalty for parking a car with an advertisement, arguing the city should keep examining whether those fines actually deter violations.
The budget motion did not include every spending item before the council that night. Lana Negrete was recused from a discretionary funding transfer for SMMUSD grad night, so that piece was pulled out for a separate vote immediately afterward. That second action covered $20,000. The result was a clean adoption of the city’s main budget package, with one school-related funding decision handled on its own track.
Approval of 2026–27 Transportation Services Plan
School transportation costs more than the district gets back. The board approved the 2026–27 Transportation Services Plan, an annual step required for the district to receive transportation reimbursement block grant funds.
Assistant Superintendent of Business Services Gerardo Cruz told the board the district receives about 300,000 through that reimbursement line, while transportation department costs exceed 1 million. He described the state funding as a drop in the bucket, but said the plan still has to be approved each year for the district to collect it.
The board approved the plan unanimously. The vote keeps the district eligible for the reimbursement even though the money covers only part of the actual cost of running student transportation.
City creates restorative justice commission
Oliver Chi said during public comment that the city’s DEI team was reorganized across departments, not eliminated, within a restorative justice framework backed by $5.5 million. Later, the council approved a seven-member restorative justice commission and set out the timing for recruitment and appointments.
Residents now have a clearer picture of how DEI work will continue and when a new advisory commission will begin.
School board adopts budget package
The board adopted the 2026–2027 district budget with a projected $12.066 million deficit and about $20 million in reserves. It also approved interfund transfers and temporary interfund borrowing for cash flow, including deferred maintenance, food service, child development, and supplemental grant purposes.
These actions determine how the district covers a deficit, manages cash flow, and funds core services next school year.
Council takes no reportable closed-session action
The council went into closed session on two existing litigation matters and later returned to open session. The City Attorney reported that both items were heard and that no reportable action was taken.
litigation
Council lists closed-session cases and recusal
The City Attorney announced closed-session items covering existing litigation, significant exposure to litigation, and several real estate negotiations tied to Santa Monica Pier and Ocean Avenue properties. One councilmember recused from item 5C, citing a potential conflict of interest under Government Code section 87100.
litigation
What we didn’t fit in this Sundays edition
SANTA MONICA had 252 more items this week. Here are sixfour — the rest are on Aware.
- GOVERNANCEAsian American, Native Hawaiian, and Pacific Islander Heritage Month proclamation. Council issued a proclamation for Asian American, Native Hawaiian, and Pacific Islander Heritage Month, referencing local history and the library’s One Book One Coast selection, and heard remarks from library leadership and the Venice Japanese American Memorial Monument Committee.
- GOVERNANCEFinal phone public comment (miscellaneous: police training grant debate; water rates and water fund). A caller raised concerns about prior Council debate over accepting grant funding for police de-escalation training and questioned water rate increases and whether the City would return $15 million to the water fund.
- GOVERNANCEClosed session agenda announcement and recusals. The City Attorney announced closed session items including multiple existing litigation matters, significant exposure litigation, and real estate negotiations. The Mayor recused from Item 5F; Councilmember Negrete also recused from Item 5F.
- GOVERNANCEClosed session: litigation, real estate negotiations, and public employee appointment; recusals announced. Council announced multiple closed session matters including several existing litigation cases, real estate negotiations for specified properties, and a public employee appointment (City Clerk). Recusals were announced for item 5G by Councilmember Hall and Councilmember Zwick.
- GOVERNANCEGeneral public comment: Charter for Compassion reference and complaint about police treatment. A speaker referenced the City’s 2013 unanimous vote to sign a Charter for Compassion and described being arrested the prior Thursday, alleging rights violations and criticizing the City’s closed session litigation agenda and police response to a dispute with a roommate.
- GOVERNANCEHuman Resources Board Policies and Administrative Regulations Updates (presentation/first reading). Human Resources presented proposed updates to board policies and administrative regulations to align with CSBA language and current practices, including diversity in recruitment, disaster service worker oaths, TB risk assessment requirements, fingerprint/DOJ notifications, personnel record access/retention, and employee notification exhibits. The director of HR was recognized for service ahead of a June 30 departure.
- GOVERNANCEBoard approves three special education settlements. The district reported and approved three closed-session settlements involving reimbursement for private occupational therapy, private tuition or educational services, independent educational evaluations, attorneys' fees, and related costs. Each settlement passed with six yes votes and one board member absent.
- GOVERNANCECouncil approves Tiara Apartments bond financing. Council held the required TEFRA hearing and approved issuance of up to $28 million in CMFA revenue bonds for Tiara Apartments, an 82-unit affordable senior housing project with 40 permanent supportive housing units. Staff said the bonds create no city financial liability, and construction is expected to start in July and finish in spring 2028.
- GOVERNANCEReturn from closed session: travel report and reportable action (Lorie Gentles settlement). After returning from closed session, the presiding officer gave an AB 1234 travel report about attending the U.S. Conference of Mayors. The City Attorney reported a settlement in Lorie Gentles vs. City for $550,000 with non-monetary terms; the vote was 5–2 with Mayor Pro Tem and Council Member Hall voting no.
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