San Jose City Council Study Session on FY 26-27 Proposed Budget - May 11, 2026
San Jose City Council Study Session on FY 26-27 Proposed Budget
The City Council held a study session on May 11, 2026, to review the City Manager's proposed operating and capital budgets for fiscal year 2026-27. Presentations covered the Neighborhood Services, Public Safety, and Strategic Support City Service Areas (CSAs), as well as fees and charges and the capital improvement program. Councilmembers asked detailed questions about specific cuts, new investments, and contingency plans. No formal votes were taken.
Public Comments & Testimony
- Multiple speakers urged the council to maintain public access to the California Room at the Dr. Martin Luther King Jr. Library, citing its value for historical research, student projects, and community heritage. Speakers included Gail Frank, Greg Smisted, Aaron from Hillbrook School, April Halberstadt, Jean Dresden, Christa Van Land, Kay, Larry Ames, Jimmy Kogura, and Jonathan Francisco Borga. Some speakers offered creative solutions such as partnerships with History San Jose or reduced hours rather than full closure.
- One speaker expressed concern about park safety and street sweeping in her neighborhood (Antonia Martinez).
- A representative from the San Jose Firefighters Local 230 opposed the proposed deferral of Fire Station 32 and elimination of 14 sworn positions, arguing it reduces emergency response capacity.
Discussion Items
Neighborhood Services CSA
- Jill Bourne (City Librarian) presented the CSA overview, highlighting key priorities: stewardship of public spaces, encampment management, library access, animal care, code enforcement assessment, and shelter optimization.
- California Room: The proposed budget cuts positions associated with the California Room special collection at the King Library, leading to closure of public access. Vice Mayor Foley and Councilmember Cohen questioned the plan for alternative access (appointments, retrieval). Councilmember Candelas suggested reduced hours. The library plans to work with the community to develop access options. No layoffs are involved.
- Preschool Program: Councilmember Foley noted cuts to preschool programs at Willow Glen and Cambrian due to low enrollment, exacerbated by free transitional kindergarten (TK) in public schools. John Cesarelli (PRNS) stated the city sees this as a business line to transition out of.
- Senior Health and Wellness Program: Councilmember Foley expressed concern about eliminating the $300,000 program and vowed to find funding.
- Park Maintenance and Beautify SJ: Discussion on redistricting park maintenance and cuts to Beautify SJ, with reassurances from staff that service levels will be maintained through optimization. Councilmember Ortiz raised concerns about East San Jose parks.
- Code Enforcement: Rachel Roberts discussed completion of the operational assessment work plan, including chronic offender resolution and enhanced vacant building inspection.
- Contingency Plan: Councilmember Cohen and Kamei stressed the need for more discussion on cuts that would occur if the transit occupancy tax (TOT) measure fails, particularly library hours.
- Housing and Homelessness: Eric Sullivan discussed interim housing throughput, Taylor Street navigation hub (over 200 individuals transitioned, average stay 3-4 weeks), and partnership with county for two interim housing sites. Councilmember Campos questioned homelessness prevention funding.
Public Safety CSA
- Chief Paul Joseph presented police and fire priorities, including AI report-writing software, reduction of unstaffed positions, deferral of training center and fire station 32.
- Fire Station 32: The budget defers opening by two years, but a manager's budget addendum proposes temporary funding by eliminating rescue medics 26 and 3 to staff it on overtime. Fire Chief Sapian confirmed the temporary nature.
- Community Paramedicine Pilot: Funded by opioid settlement funds, aims to divert appropriate 911 calls to a paramedicine unit. Councilmember Candelas asked about metrics.
- Crossing Guards: The budget cuts 5.79 vacant crossing guard positions. Councilmembers Foley, Ortiz, and Cohen discussed concerns about school consolidations and traffic patterns. Deputy City Manager Shemby committed to an information memo in October 2026 to reassess needs.
- AI Report Writing: Chief Joseph explained the pilot software could significantly reduce overtime spent on report writing. Councilmember Campos raised concerns about governance and guardrails; Cohen expressed support. The department will go through RFP process.
- Walking Beats: Councilmember Duong noted cuts to walking beats in Lincoln district; Chief Joseph stated they are costly and unfilled positions.
Strategic Support CSA
- Khaled Tawfik (CIO) and Aram Korumchian presented on IT, HR, finance, and public works. Investments include $5M for critical IT infrastructure, $500K for new grants management system, $380K for three mechanics, and $270K for 311 software licenses.
- 311 Customer Satisfaction: Mayor asked about improving satisfaction from 66% to 70% target. Tawfik cited integration with back-end services through the customer experience initiative. Councilmember Kamei raised concerns about ticketing system closing reports without resolution.
Fees & Charges
- Discussion on parking meter rate increases ($2/hour in downtown, extended to 9pm), mural fees, ambulance transport fee (revenue estimates lowered due to payer mix), and suspension of gated event fee. Councilmember Kamei suggested reviewing citation amounts for revenue generation.
Capital Budget
- Jennifer Tell and Matt Lesh presented the $1.2B mid-biannual capital budget update and $3.3B five-year CIP. Major changes include exhaustion of Measure T funds by 2028-29, removal of $200M airport parking garage project, additions for HVAC at EOC, water intrusion remediation at City Hall, and paving program.
- Councilmember Tordillos sought clarification on EOC HVAC replacement; Lesh explained issues with contractor and need for critical facility.
- Councilmember Mulcahy discussed water intrusion at City Hall and hoped the plaza greening could be considered as part of the solution.
Key Outcomes
- No formal votes were taken; the study session was informational.
- Staff will provide an information memo in October 2026 on crossing guard needs following school consolidations.
- Staff will continue to refine the contingency plan and will bring it back for council action if the TOT measure fails.
- The California Room access plan will involve community engagement and exploration of alternatives (appointments, partnerships).
- The community paramedicine pilot will be implemented with opioid settlement funds.
- The parking meter rate increases and other fee changes will be brought forward for separate adoption in June.
- The capital budget mid-biannual update was presented for council review; no changes were directed.
Meeting Transcript
Please call the role. Kameh, Campos. President Tordillos. Here. Cohen. Ortiz. Present. Walkhi. Here. Duan. Here. Kendallas. Here. Casey. Foley. Mayhan. Here. You have a quorum. Okay, great. Thank you. All right. We are continuing on with neighborhood services, and I believe I'm handing it over to Jill. Yes, good morning, Mayor and City Council members. I am Jill Bourne city librarian. I'm here with my colleagues, Eric Sullivan, Director of Housing Department, John Cesarelli, Director of Parks, Recreation, Neighborhood Services, Rachel Roberts, the Assistant Director of Planning, Building, and Code Enforcement, and Angel Rios, our deputy city manager. We are here to present the overview of the fiscal year twenty six twenty-seven proposed operating budget of the neighborhood services city service area. Collectively, this CSA is responsible for such elevated and critical outcomes as providing community spaces, equitable access to opportunity, vibrant public life, and housing security. Oh. Through our wide variety of core services, the departments in the city service area are uniquely integral to our residents' quality of life. While the foundations of a city include buildings and streets and infrastructure, the foundations of community are found in connection, inclusion, and opportunities to learn, grow, and thrive, both individually and together. In the neighborhood services CSA, residents learn to read, to Zumba, to swim, to 3D print, to upskill for their next job, or even to apply online. They grow with nutrition with therapeutics, fresh air, and opportunities for youth to lead the way. And they thrive by maintaining their neighborhoods or simply finally having a room of one's own. The programs provided by the CSA create the net of services that engage and support our residents, creating meaning and authentic connection from shared knowledge, shared spaces, and shared experiences. The CSA dashboard demonstrates continued improvement in park condition assessments, positive directions on code enforcement, and maintaining high performance in library services and occupancy of temporary and interim housing solutions. Yet some positive changes to the housing and code enforcement budgets, both of which have additional funding budgeted in other city service areas. The long-term goal is for San Jose residents to enjoy a city with clean public spaces and well-maintained private property. To achieve this goal, we are addressing three problems. First, blight on private property. Code enforcement is pursuing strategies to address complaints more rapidly and effectively. Second, graffiti. We will add graffiti as one of the objects detected by our limited deployment of AI object detection cameras. And third, illegal dumping. Beautify San Jose and environmental services staff are pursuing strategies to increase usage of legal waste disposal methods and enforce against illegal dumpers. The CSA priorities for service delivery going into fiscal year 26-27 include stewardship of public spaces, encampment management and cleanup services, high-quality library access collections and programs. Continuing contracted veterinary services and care for animals through animal care and services programs, continuing to implement recommendations from code enforcement's operational assessment, and continuing to optimize the shelter system management. Okay, significant actions in the proposed budget include following the transition of animal care services to PRS department. We are also making an additional investment in low-cost spay neuter services at the animal care center. Assuming the passage of the proposed transit occupancy tax, there will be no major impacts to park maintenance, which therefore allows new investments in fire prevention in Alam Rock Park and open spaces. Savings will be entailed in the optimization of the beautify SJ program.
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