Carpinteria leaders are once again sounding the alarm about the city’s financial future, warning that difficult cuts to programs and services are ahead in 2027 if the city doesn’t find additional revenue streams.
At the State of the City gathering Monday at Carpinteria’s Veterans Hall, staff said the city spends $2.8 million to subsidize services that bring in minimal or no revenue: the library, senior programs, and landscape and berm maintenance, among others.
To close that gap, the city pulls from its available fund balance — essentially its savings account.
But that fund balance is now “steadily dwindling,” City Manager Michael Ramirez said, because the city’s expenses are outpacing its revenues to the tune of roughly $1 million per year.
A large part of that, staff said, can be attributed to the rising cost of the Santa Barbara County Sheriff’s Office contract. The city of Carpinteria does not have its own police force; it contracts with the Sheriff’s Office for law enforcement services.
That contract jumped from $3.9 million in 2019 to an expected $7.5 million for the 2026-27 fiscal year, which began July 1.
The city is also still paying $500,000 a year in pensions from when Carpinteria did have its own police department, which disbanded in the 1990s.
The city has begun to help address its structural deficit by reducing operating hours and scheduling less frequent maintenance, Ramirez said.
But making cuts without securing additional revenues isn’t sustainable, Ramirez said.
“If construction is going up, if our Sheriff’s contract is going up, if the cost of maintaining staff… is going up, say, 4%, but you’re increasing revenues at 2.5%, you’re slowly losing ground every year,” he said.
Ramirez clarified that the city isn’t “near the cliff” financially.
The city’s committed reserves — funds set aside to keep the lights on, so to speak, in the event of emergencies such as another pandemic — are fully funded at $8.7 million. But those monies cannot fund day-to-day programs.
The city also faces $24 million in deferred street and road maintenance, as well as over $130 million in unfunded capital-improvement projects.
Many of the city’s streets are in poor or failed condition, including portions of major thoroughfares such as Linden and Carpinteria avenues.
Some of those projects have dedicated grant funding that doesn’t come out of the city’s pocket, but others — such as critical pool repairs, at $3.3 million — do.
For the 2026-27 fiscal year, the city is projected to bring in roughly $30.7 million in revenues and have $31.1 in expenditures.
The city’s latest effort to address that gap is a 0.25% sales tax measure, which Carpinterians will vote on in November. (The city already has a 9% sales tax, and per state law, can only max that out at 9.25%.)
If voters approve that measure, the city could generate an additional $700,000 per year.
But that is only a drop in the bucket. It would “provide additional resources, but it would not eliminate the city’s broader financial challenges,” Mayor Natalia Alarcon said.
And Carpinteria voters have historically not been keen to raise their costs. Property owners in March rejected assessments that would have fully funded the city’s berm ($80,000) and right-of-way landscape costs ($1.15 million).
The sales tax measure may have an easier time passing because it would be paid, at least in part, by tourists, rather than just property owners, staff has said during earlier discussions.
All city residents will also have the chance to vote on it, rather than just property owners.
A handful of community members offered suggestions to help Monday night, calling on the city to sell surplus land or expedite business permits to help inject new commercial life into the city.
Commenter Lorraine McIntire asked what the backup plan is if the 0.25% sales tax measure doesn’t pass.
Ramirez said city staff is working on presenting several options to the council.
But, ultimately, if it doesn’t pass and the city doesn’t secure additional revenue streams, the community will see “steeper cuts in programs or service levels, whereas right now we’re trying to make even cuts across the board,” he said.
Where exactly those cuts will fall is ultimately up to the City Council.
But any cuts without new revenue streams still “won’t solve the issue,” Ramirez said. “…It could get bad if we don’t do something sooner than later.”
See the city’s full budget breakdown here.
