Redwood City Releases FY 2026-27 Recommended Budget Focused on Core Services, Community Priorities, and Strategic Investments

Redwood City, CA - The City of Redwood City has released its Fiscal Year 2026-27 Recommended Budget, a balanced budget that maintains core services and continues investments in community priorities while recognizing a more constrained fiscal environment for local governments. The budget advances work to enhance quality of life, promote public safety, maintain critical infrastructure, modernize service delivery, and support the City Council's priorities of Housing, Transportation, and Children and Youth. The Recommended Budget will be presented to the City Council for consideration at its June 8 meeting and is scheduled to be considered for adoption at the City Council meeting on June 22.

"This budget maintains Redwood City's focus on the services, infrastructure, and community priorities that matter most to residents," said City Manager Patrick Heisinger. "While we are operating in a more constrained fiscal environment, Redwood City remains financially stable and well-positioned. The Recommended Budget continues important investments while reflecting the discipline and planning needed to serve the community responsibly in the years ahead."

The FY 2026-27 Recommended Budget includes $213.7 million in projected General Fund revenues and transfers-in and $226.0 million in General Fund operating expenditures and transfers-out. The budget is balanced, in part, by using available one-time resources. The City's 15 percent General Fund reserve remains fully funded. The Recommended Budget also includes $40.5 million in capital investments supporting facilities, parking, parks, sewer, stormwater, transportation, and water infrastructure.

The budget continues funding for the City Council's long-standing priorities of Housing, Transportation, and Children and Youth, with investments across the following areas:

Housing and Homelessness Response: Continued implementation of the City's Anti-Displacement Strategy, Tenant Protection Ordinance, Housing Preservation Program, tenant-landlord counseling, home repair assistance, homelessness outreach, encampment resolution, shelter navigation, and pathways to permanent housing. In May 2026, the City Council also committed nearly $13 million for new affordable housing projects, one of the City's most significant recent investments in affordable housing.

Transportation and Traffic Safety: Continued implementation of Vision Zero and Complete Streets initiatives, including traffic calming improvements, bicycle and pedestrian safety enhancements, school-area safety projects, pavement rehabilitation, accessibility upgrades, and continued advancement of the Vera Avenue Bicycle Boulevard, Broadway Complete Streets, Roosevelt Avenue traffic calming, and the Highway 84/101 Interchange Reimagined project.

Children, Youth, and Families: Continued support for recreation programs, youth sports programming, after-school and summer enrichment, teen and tween engagement opportunities, Project READ, library services, parks, community centers, completion of the Hoover Park Renovation Project, and continued activation of the Veterans Memorial Building/Senior Center.

Public Safety and Operational Readiness: Restoration of funding for two previously unfunded police officer positions, additional Fire Department training and professional development funding, support for fire mitigation efforts in City parks and open space, and continued investment in cybersecurity and technology initiatives that protect critical City systems.

Quality of Life: A proposed pilot Neighborhood Response Team, pedestrian mall improvements and beautification, upgraded downtown library restroom facilities, and traffic calming and traffic safety improvements. The Neighborhood Response Team would focus on improving neighborhood conditions and addressing issues such as illegal dumping, encampment clean-up, nuisance conditions, and code violations, enabling the City to respond more quickly to community concerns and resolve neighborhood issues more efficiently without pulling Public Works, Code Enforcement, and Police Department staff away from other critical priorities.

Capital Infrastructure: $40.5 million in capital investments supporting City facilities, parking, parks, sewer, stormwater, transportation, and water infrastructure. The budget also supports continued work on a facilities assessment study, a Citywide stormwater master plan, and long-term capital funding strategy options.

Modernized Service Delivery: Continued work to improve customer service, operational efficiency, transparency, digital service delivery, automation, and internal coordination across City departments.

The Recommended Budget also reflects a changing fiscal environment. Following several years of strong revenues, major capital investments, and organizational growth, Redwood City is entering a period that will require increased fiscal discipline, prioritization, and long-term planning. Several factors are contributing to a weaker revenue outlook, including the State's failure to provide San Mateo County jurisdictions with Property Tax in Lieu of Vehicle License Fee backfill funding, declining sales tax performance, business license tax performing slightly below forecast, and loss of certain grants.

Looking beyond FY 2026-27, the City's General Fund is forecasted to experience annual deficits ranging from $22 million to $29 million beginning in FY 2027-28. Redwood City will continue monitoring its financial position, evaluating long-term fiscal strategies, and working with San Mateo County and other cities to restore VLF backfill funding, which could provide approximately $5 million annually to Redwood City if successful.

The FY 2026-27 Recommended Budget is available at www.RedwoodCity.org/Budget. For more information and ways to participate in the City Council meetings, visit www.RedwoodCity.org/CouncilMeetings.