Sacramento proposes layoffs, parking fee hikes to combat $44 million budget deficit

Mathew Miranda, The Sacramento Bee on May 1, 2025

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SACRAMENTO, Calif. — Sacramento has proposed layoffs for the first time since 2013 and rate increases at parking meters for a second straight year to address its multi-million budget deficit.

The $1.65 billion budget, unveiled Wednesday by Interim City Manager Leyne Milstein, is the first fully developed plan to tackle the $44 million shortfall for the upcoming fiscal year which begins July 1. Among the recommendations are removing 12 full-time employees, eliminating 70 vacant positions and increasing fee hikes in the older adult services division and for parking.

Milstein’s ideas to balance the structural deficit — which happens when rising expenses do not match revenue growth — stem from a list of revenue enhancement and budget reduction strategies submitted by each department earlier this year. The City Council will now spend the next few weeks deliberating before adopting a budget by the end of June.

“I want to acknowledge the very real impacts of this and assure you that we will be working with affected employees to help find other opportunities within the city organization wherever possible,” Milstein wrote in an email to city employees on Wednesday. “While the proposed budget is balanced, the city still faces uncertainty ahead.”

Under Milstein’s proposed budget, the city’s fire and human resources departments would experience the most layoffs with a loss of nine filled positions combined. That includes a fire captain, program supervisor and human resources administrative assistant.

The police department would have one reduced position and 26 vacant positions eliminated despite its budget growing from $247 million to $255 million. The vast majority of proposed eliminated vacant positions are community service officers. Both the fire and police departments have used vacant positions in the past to fund overtime pay.

In her email, Milstein said the impacted employees have already been notified of the proposed cut and any layoff process, if needed, would begin in July. The city has negotiated in previous years with labor unions to limit positions lost.

Stationary Engineers Local 39, the city’s largest union, was unsure Wednesday afternoon if and how many of its employees would be affected by the proposed budget. But, union representative Payden Martin said he was “confident” that a resolution would be reached.

“While we are happy it wasn’t worse, we still think the city should address its spending problems and it shouldn’t come off the back of its workers,” Martin said.

Both the city’s Utilities and Public Works departments would benefit from an increase of 19 combined positions under this budget.

The proposed budget also calls for several fee hikes across departments including parking meters, planning division inspections, aquatics and development programs and Triple-R Adult Day Centers — a decades-old program serving people with dementia.

Other decreases in funding would affect security services at Hart Senior Center and eliminate the Youth, Parks, and Community Enrichment department’s Youth & Family Investments program.

Councilmember Roger Dickinson, who said he was generally supportive of the proposed budget, said the investments program was among the ones that needed a closer look.

“That’s the kind of program that we would want to take a look at and see if that’s prudent in trying to provide the best environment for kids and families and the safest community that we can,” said Dickinson, who said he had only skimmed the budget thus far.

Multiple council members, including Mayor Kevin McCarty, declined to comment on specifics of the proposed budget. McCarty, in a written statement, called Wednesday the “start of a deliberative process, while Councilmember Lisa Kaplan said the elected body had “difficult decisions ahead.”

In her opening budget statement, Milstein noted the additional looming threats to the city’s finances. These are risks of federal funding, tariffs, threats of a recession and the city’s approximately $1.8 billion of unfunded capital projects and deferred maintenance costs.

“The city is facing considerable fiscal challenges as it heads into the new fiscal year,” Milstein wrote.

Public hearings on the proposed spending plan will begin on May 13. The council is expected to adopt the budget on June 10th though the elected body has until the end of that month. The budget goes into effect July 1.

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