While dealing with today’s financial and other challenges, the City of Santa Maria continues to focus on prepping for future growth by planning for additional housing, traffic, parks and more.

“The state of our city is that we have a lot of things going on in Santa Maria,” Mayor Alice Patino said Tuesday at the State of the City event. “We must solve our budget challenge of expenses outpacing our revenues.”

City leaders, so far, have kept the level of service unchanged despite a $25 million shortfall, she added.

The annual State of the City presentations occurred Tuesday afternoon in Patty Boyd Hall at Allan Hancock College. The Santa Maria Valley Chamber of Commerce organized the event in conjunction with the city.

After the mayor’s presentation, several city department leaders spoke about planning, public works, police, fire and utilities activities before City Manager Dave Rowlands took to the stage.

Much of the event focused on activity across the city.

“Building activity remains very strong,” Patino said.

A year ago, the Community Development Department averaged a permit issued every 51 minutes and two housing units per minute every working day, Patino said.

In the first eight months of 2025, the city issued 1,814 permits, with a valuation of $101 million.

That compares with 1,700 permits for the same time span in 2024, with a valuation of $72 million, she added.

Projects in the works include a new Home Motors dealership at Bradley and Battles roads with the location opening as soon as April.

The Betteravia Plaza apartments, with 443 units, are under construction off West Betteravia Road a few blocks east of the Santa Maria Police Station.

In addition, the Planes of Fame Air Museum is under construction at the Santa Maria Public Airport.

She iterated her aggravation about mandates from the state, taking away local control and leading to the loss of neighborhoods, noting the removal of rules ensuring that residents have parking. 

“We want to build. We have the political will to build. … We want to dictate our future on how we build,” she added. 

The city is working to update its General Plan, a blueprint for future growth with an eye to ready for the next two decades, including 16,410 housing units, 58,265 new residents and 23,750 jobs.

“A growing city population can be beneficial because it indicates economic vitality, increased tax revenue and a more vibrant community,” Patino said. “However, it presents challenges such as the need for improved infrastructure and services to accommodate more residents.”

Santa Maria has 5,600 housing units of all types in the pipeline. Additionally, 2,724 acres, or 19% of the property within the existing city boundaries, remain vacant. The city hopes to annex 985 acres east of Highway 101 into the city to accommodate future growth. 

Meanwhile, efforts to revitalize downtown Santa Maria continue to move forward with 12 projects at various phases of the approval and construction process expected to bring new businesses and 1,022 new housing units.

Recognizing financial challenges facing builders, the Community Development Department also has lined up two programs offering low-interest loans.

“We are looking for new ways to generate economic development and to help our development community,” Community Development Director Chenin Dow said.

The programs aim to make it easier for developers to close the financing gap on projects, she said. The two different programs provide low-interest loans to fund items such as streets, sidewalks, utilities, street lights, development impact fees and more. 

“It is our hope and expectation that these will help close the gap for developers who are just looking for that little bit of extra funding,” she said.

Growth will bring a need to accommodate more traffic, Public Works Director Brett Fulgoni said, adding that the city continues to work on revising developer impact fees.

In July, the city released a draft fee plan for developers to pay $56,000 for a 2,000-square-foot house. That’s significantly higher than the current rate of $22,000 for a residence. 

After hearing concerns from developers who noted that higher growth impact fees would hike housing costs and make projects not feasible, the city recently released a revised rate of $38,000 for a 2,000-square-foot house. 

For a restaurant about 1,000 square feet in size, the fee would drop from $57,000 to $34,000. 

“We’re doing what we can to try to keep these fees down, but these fees are important to pay for infrastructure as the city grows,” Fulgoni said. “We’ve heard a lot about growth tonight, and it’s important that we maintain the city services the same way we would with growth. It’s got to stay in pace, and this is how we do that.”

He also revealed that Santa Maria’s public transit now boasts having a 100% electric bus fleet.