2027 Budget Proposal Includes Health Department Cuts as Overall Spending Declines

Pasadena’s proposed fiscal year 2027 budget would reduce funding for the city’s Health Department by about $2.5 million, a drop tied largely to the expiration of grants that currently support key public health and homeless outreach programs.

City officials report the funding loss could eliminate support for 21 full-time positions unless alternative funding is identified, placing services such as homeless outreach, infectious disease response and nursing care at risk.

Among the programs affected is the Pasadena Outreach Response Team, or PORT, which provides services to people experiencing homelessness.

The expiring grants also fund an infectious disease outreach worker and a full-time nurse. Maintaining those services — along with expanding the Health Officer role to a full-time position — would cost an estimated $511,000, according to city staff.

Officials said they are exploring new grant opportunities but may rely on one-time General Fund dollars as a fallback to sustain PORT operations if additional funding does not materialize.

The City Council is expected to open a public hearing on the proposed budget and continue deliberations through mid-June, when a final spending plan is scheduled for adoption.

“The City has been presenting the recommended operating budget to the City Council through committee-level hearings with the hope to continue in May and June with public hearings — such as for the CIP and tax schedules — before adopting the final budget. The new fiscal year hopefully begins with an approved budget,” said Interim City Manager Matthew Hawkesworth in a statement to Pasadena Now.

The proposed budget totals about $1.41 billion across all funds, down from roughly $1.51 billion in the current fiscal year. At the same time, the city’s General Fund — its primary operating fund — would increase from about $364.9 million to $383.4 million.

The General Fund supports core city services, including police and fire operations, public works, libraries, housing and human services, planning and transportation, as well as administrative functions such as the City Manager’s Office, City Attorney, Finance and Human Resources.

It is funded through a mix of revenues including taxes, permit and license fees, service charges, fines, investment earnings and other sources.

Despite the increase in the General Fund, the overall budget reflects ongoing financial pressures. City officials said the fiscal year 2027 plan relies on approximately $1.6 million in one-time sales tax revenue and $3.8 million in reserve funds to remain balanced.

While revenues are expected to grow modestly — about 3% to 4% annually — expenditures are rising faster, at an estimated 4% to 6%, creating a structural imbalance that could widen in future years.

The budget proposal largely maintains existing service levels, with limited new spending. Recommended additions include funding for accessibility improvements to the city’s website and public documents, economic development marketing and an expansion of the Fire Department’s paramedic training program.

Other unfunded or pending needs include $910,000 in proposed police technology upgrades ahead of the 2028 Olympic Games and a plan to transition parking enforcement services in-house, with startup costs estimated at $600,000.

A five-year financial forecast included in the report projects growing deficits if current trends continue, with officials warning that reliance on one-time funding does not address long-term fiscal challenges.

The City Council is expected to open a public hearing on the proposed budget and continue deliberations through mid-June, when a final spending plan is scheduled for adoption.

Under the City Charter, the City Manager must submit a proposed budget by the third Monday in May, after which the City Council is required to open a public hearing and adopt a final spending plan by mid-June.