Adopted 2025-26 Budget

Adopted Budget Summary

The Adopted Budget included a status quo staffing of 21.0 full-time equivalent (FTE) positions, including negotiated salary and benefit increases. Appropriations totaled $6,668,321, funded by revenues of $1,035,117, a General Fund Contribution of $5,225,414, and use of Other Fund Contributions of $407,790.

Budget Summary

The budget increased expenses by $928,673 largely from a $526,687 increase in Cost Allocation Plan charges, $407,790 increase in encumbrance carryovers for the final budget, $229,940 increase from a change in accounting standards that adds a non-cash amount for inferred capitalization and liability amounts to subscription software costs, $197,982 increase from a change in facility charges to properly reflect the costs of facility services and utilities, and $153,000 increase in technology support services. These increases were offset by a $589,128 decrease in certain professional services due to the completion of one-time projects, such as the new Agenda Management System, realignment of stipends for the County’s advisory boards, commissions, committees and department advisory groups, and other reductions. The budget increased revenues by $232,850 due to a $156,850 increase in Cost Allocation Plan recovery of support costs and a $75,000 increase in other revenues, primarily a grant from the Annie E. Casey Foundation received in 2024-25 that has unspent funding carrying over to 2025-26.

Last Day Budget Summary

The Last Day Budget added $30,000 in expenses for a transfer out from the Local Innovation Fund to Probation to continue supporting local youth programs.

Final Budget Summary

The Final Budget added $407,790 in expenses, including $257,393 in encumbrance carryover for continuing contracts, $19,180 in encumbrance rollovers for real estate services and $131,217 in rebudget contract expenses, funded by the carryover of prior year fund balance.

Federal Policy Response Team: The CEO is closely monitoring recent federal adjustments to contracts, grants, policies, and funding priorities, which have the potential to impact programs in health care, homelessness, benefits services, and numerous other vital areas. Led by the CEO, the Federal Policy Response Team is a multi-departmental effort formed to: identify and assess policy and financial changes affecting county programs; increase interdepartmental and community partner collaboration to ensure financial and services sustainability; engage with communities and advocate for policy positions and funding solutions at state and federal levels; and co-develop and communicate adaptation strategies to anticipate and mitigate service disruptions.

Strategic Plan Refresh: The County of Santa Cruz continues to advance its strategic initiatives to align leadership, foster collaboration, and achieve measurable results for residents and communities. These initiatives ensure that County policies, programs, and resources align with community needs and aspirations. With the first County Strategic Plan completing its six-year cycle in 2024, efforts are now focused on refreshing the plan to guide the County’s work from 2026 through 2032. The Strategic Plan refresh will build on the existing foundation, ensuring that the County continues to focus on results that reduce disparities and increase opportunity. The CEO is committed to engaging the public, County staff, County boards, commissions and other advisory bodies, and the Board of Supervisors in shaping the next iteration of the Strategic Plan.

Building Permit Organizational Assessment: In June 2024, the CEO engaged Baker Tilly to complete an organizational assessment of the County’s building permit process with the goal to gain an understanding of insights from internal and external sources and to develop recommendations for moving forward with improved processes and customer experience. Baker Tilly’s work included a review of current and past process improvement efforts, operational data, interviews with employees and customers, stakeholder meetings, and an employee survey. By June 2025, the CEO, in conjunction with Baker Tilly and the Community Development and Infrastructure (CDI) Department, will develop a workplan to implement near and longer-term improvements to the development and building permit approval process based on the assessment.

Succession Planning: The CEO has been succession planning for department heads and other executives across the County. The CEO works closely with non-elected department heads to help identify and develop the next generation of County leaders. To assist with this effort, the County established the Learn Engage Apply Perform program and is launching the fourth cohort in May 2025.