San Luis Obispo County is working to close a more than $35 million budget deficit heading into the 2025-26 fiscal year, prompting proposed service cuts across several departments.
County officials say the shortfall is driven by rising labor costs, slower revenue growth, and increased demand for public services. In response, the County launched a Financial Rebalancing and Resilience Initiative, asking most departments to reduce their General Fund support by up to 15% or more.
“The cost of providing county services has risen and at the same time recent program expansions aimed at addressing community needs have further increased expenditures, surpassing revenue growth,” said Budget Director Lisa Howe at Monday’s budget hearing.
Howe added that paying competitive wages and benefits remains a priority to retain qualified staff.
If approved, the proposed reductions would close health clinics in Paso Robles and Grover Beach, scale back behavioral health programs like Martha’s Place and substance abuse services, and eliminate five community parks positions, which could affect park maintenance and irrigation.
The Sheriff’s Office is also facing a reduction of 13 positions, including roles related to school safety and narcotics enforcement.
Despite these cuts, the County’s overall spending is projected to rise by $78 million over last year, largely due to state and federal funding for mandated services. No direct federal funding cuts were identified in the proposed budget.
The Board of Supervisors is scheduled to meet on June 17 to finalize the budget.
