Santa Cruz County's proposed $1.29 billion budget for 2026-27 protects core services and avoids layoffs by using $43 million in one-time funds, reducing reserves to 10.4%. - The county faces a projected $67 million deficit in FY 2027-28 without structural changes.
- Federal policy changes under H.R. 1 shift safety-net costs to counties, threatening Medi-Cal and CalFresh.
- The county supports a state funding request of $1.9 billion in 2026-27 and $4.5 billion in 2027-28. Public budget hearings begin May 5 in Santa Cruz and Watsonville.
The county urges community engagement to address long-term fiscal challenges.