Though Milpitas faces a multimillion-dollar budget shortfall in the next five years, it\u2019s still a marked improvement over forecasts from last year, according to city officials.<\/p>\n
\u201cWe know that there\u2019s still more work ahead of us,\u201d said Acting City Manager Jared Hernandez<\/a> at Tuesday\u2019s meeting. \u201cWe\u2019re not declaring victory yet, but we are saying that we\u2019re in a much better position.\u201d<\/p>\n Last year, the city predicted a $28.5 million budget shortfall<\/a> by 2030. Since then, the city has cut positions and tightened spending to reduce that number by more than half by 2030, and expects a slight surplus for the next year.<\/p>\n \u201cBalancing the budget is paramount, and it seems like you all did a great job,\u201d said Milpitas Mayor Carmen Montano to staff at the meeting.<\/p>\n But the longer term fiscal picture is murkier.\u00a0While revenue from taxes is largely expected to grow over the coming years, the cost of running the city is expected to grow faster, with salaries and benefits making up the bulk of the city\u2019s spending. After 2028, the city expects a budget shortfall that will grow by millions each year to an expected $19.2 million in 2031.<\/p>\n The forecast troubled some on the council, who peppered staff with requests for more information on how to fix the city\u2019s financial future and expressed their anxiety over the impending budget hole.<\/p>\n \u201cJust by looking at this, I\u2019m already concerned,\u201d said Councilmember Evelyn Chua of the rising costs and the predicted deficit increase. \u201cIt should be the other way around \u2014 It should be decreasing.\u201d<\/p>\n The city also faces challenges familiar to many others across the state: hybrid work and online shopping that have cut back on retail and commercial development, issues with federal and state funding that could make some residents rely more heavily on city-level services, potential instability from tariffs and federal policy, and stagnating job growth across the state.<\/p>\n Still, Milpitas Financial Director Luz Cofres\u00ed-Howe maintained that the budget could be brought to a healthier place, and lauded the \u201cextraordinary\u201d efforts of city staff to cut back the predicted deficit. She points to a newly opened facility by electric vehicle manufacturer Rivian<\/a> and a coming Amazon warehouse<\/a> as drivers of tax revenue, and noted that the city was eying a revamp of its 50-year-old business licensing program, which could add more revenue.<\/p>\n \u201cThe city will have to make some hard decisions,\u201d said Cofres\u00ed-Howe, though she remained optimistic. \u201cOur challenges feel achievable \u2026 we are in a strong enough position.\u201d<\/p>\n The city is expected to finalize its budget in early June, holding a series of public hearings and town halls in the coming month to inform the public and the City Council about Milpitas\u2019 financial future.<\/p>\n","protected":false},"excerpt":{"rendered":"Though Milpitas faces a multimillion-dollar budget shortfall in the next five years, it\u2019s still a marked improvement over…\n","protected":false},"author":2,"featured_media":18865,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[29],"tags":[51111,191,33711,88,90,89],"class_list":{"0":"post-204694","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-san-jose","8":"tag-city-budget","9":"tag-milpitas","10":"tag-milpitas-city-council","11":"tag-san-jose","12":"tag-san-jose-headlines","13":"tag-san-jose-news"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/204694","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/comments?post=204694"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/204694\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media\/18865"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media?parent=204694"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/categories?post=204694"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/tags?post=204694"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}