Potential revenue loss from San Bruno’s agreement with Walmart.com, new regulations around cardrooms and a lack of state backfill from vehicle license fees is putting the city in a precarious financial position, staff said, warning of a $1.7 million budget deficit for the upcoming 2026-27 fiscal year.
If the city doesn’t take action on increasing its revenue in coming years, that forecast may further deteriorate, Chief Financial Officer Nick Pegueros said. That includes a future worst-case scenario that the city loses all at-risk revenue sources and has to draw on $84 million in reserves, of which it currently has only $57.4 million, to keep its current services.
San Bruno’s financial woes are caused largely by the state government’s financial decisions, City Manager Alex McIntyre said. That includes a $3.4 million loss from new state restrictions that will prevent casino Artichoke Joe’s from offering blackjack. It also includes potential $8 million in annual losses, plus possible $43 million in repayment, if San Bruno loses rights to sales taxes from Walmart.com, whose e-commerce headquarters are located in the city.
Aside from $3 million in missing vehicle license fee in-lieu funds, which is a countywide problem based on the state’s bureaucratic distribution system, California is also asking for $2 million back from the Educational Revenue Augmentation Fund, claiming the county’s calculation was invalid.
“Our story today is about the immediate term and the short term, and it’s just a tough story,” McIntyre said. “We’ve been sort of raising the red flags for a couple years, saying this day could come. We are here now because of the state of California.”
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San Bruno’s long-term financial future is more positive, McIntyre said, highlighting plans for a Tanforan rebuild designed to revitalize the city. In the meantime, however, staff and council are looking for solutions to manage what McIntyre termed the “trough years.”
For the upcoming fiscal year, San Bruno could eliminate its $1.7 million budget deficit — $74.7 million in revenue and $76.4 in expenditures — by freezing eight full-time staff positions, Pegueros said. The city should also be looking at another revenue-generating measure, like a sales tax, parcel tax or hotel tax, to bring to voters by 2028.
Aside from those options, service reductions or pulling on the city’s reserves could also help alleviate its financial burdens, which are being exacerbated by its regular expenditures outpacing its revenue growth.
“I want to challenge the notion of reserves being ‘kick the can down the road.’ Some of these reserves, we set them up specifically to address budget shortfalls,” Councilmember Michael Salazar said. “I want to lift the taboo that we absolutely don’t want to touch these.”
Folks, don’t fall for the sob stories from San Bruno about their budget deficit of $1.7 million. Remember, this is the San Bruno who wasted at least $4 million to institute paid parking. And this is the San Bruno who’ve already paid (who knows how much) to a consultant firm in the past and now will spend another $2.8 million on consulting firms.
Methinks these folks are setting the stage for another tax proposal to transfer more of your hard earned money to pay ever-increasing union salaries, pensions, and benefits even though San Bruno has $84 million in reserves. If anything, folks should keep an eye out to ensure San Bruno isn’t going to blow their reserve on pet projects which won't serve all residents.
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Folks, don’t fall for the sob stories from San Bruno about their budget deficit of $1.7 million. Remember, this is the San Bruno who wasted at least $4 million to institute paid parking. And this is the San Bruno who’ve already paid (who knows how much) to a consultant firm in the past and now will spend another $2.8 million on consulting firms.
Methinks these folks are setting the stage for another tax proposal to transfer more of your hard earned money to pay ever-increasing union salaries, pensions, and benefits even though San Bruno has $84 million in reserves. If anything, folks should keep an eye out to ensure San Bruno isn’t going to blow their reserve on pet projects which won't serve all residents.
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Keep the discussion civilized. Absolutely NO personal attacks or insults directed toward writers, nor others who make comments.
Keep it clean. Please avoid obscene, vulgar, lewd, racist or sexually-oriented language.
Don't threaten. Threats of harming another person will not be tolerated.
Be truthful. Don't knowingly lie about anyone or anything.
Be proactive. Use the 'Report' link on each comment to let us know of abusive posts.
PLEASE TURN OFF YOUR CAPS LOCK.
Anyone violating these rules will be issued a warning. After the warning, comment privileges can be revoked.