TO: Honorable Mayor and Members of the City Council
FROM: Jarad Hildenbrand, City Manager
1. SUBJECT
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Consideration of Resolutions pertaining to the November 3, 2026 General Municipal Election including a one-cent Transactions and Use Tax (Sales Tax) Measure
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2. SUMMARY
For several years, the City of Orange has grappled with significant financial constraints. In response, for the past several years, the City has reduced services to balance the budget. After making considerable reductions, continued cost increases coupled with lagging revenues have resulted in a roughly $20 million operating deficit for Fiscal Year 2026- 2027. To address this deficit for Fiscal Year 2026-2027, the City eliminated or froze over 50 full-time equivalent positions, reduced its operating expenditures even further, and intends to transfer $17 million from the City's Emergency Medical Transfer Fund, Capital Improvement Plan Fund, and Equipment Replacement Fund. This is a short-term solution to an ongoing structural budget deficit. Consistent and ongoing revenue is necessary to not only balance the City's budget, but fund and restore community programs and services. Per City Council direction at the March 24, 2026, City Council meeting, staff is proposing resolutions pertaining to the November 3, 2026 General Municipal Election including a draft 1? Transactions and Use Tax (Sales Tax) ballot measure for the City Council's consideration.
Over the past two budget cycles, the City has already implemented significant efficiency measures, including the elimination or freezing of over 50 full-time positions, reductions in service levels, and the deferral of capital investments. These actions reflect a comprehensive, multi-year effort to identify operational efficiencies and reduce expenditures wherever feasible. As a result, the City's current staffing levels are at or near a 20-year low, and General Fund operating expenditures have remained nearly flat despite rising costs...
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