San Diego, CA
San Diego guts arts funding to balance budget as California cities make deep spending cuts
San Diego is slashing funding for arts, libraries and recreation centers, as it stares down a $146 million budget deficit that’s forcing unpopular spending cuts.
It’s not alone. Other California cities face similar gaps, including Los Angeles with a $200 deficit, Sacramento with a $66 million shortfall and San Francisco facing a $643 million gap over the next two years.
The cities’ financial woes echo the state’s projected deficit of $3 to $18 billion, as inflation collides with cuts in federal aid. In San Diego, lackluster growth of local sales, property and hotel taxes create an additional squeeze.
“What we’ve been seeing over the last several years after COVID and inflationary pressures, is that it has affected prices across the nation, across the world,” said Rolando Charvel, chief financial officer for San Diego. “Costs are going up faster than our revenue growth”
San Diego Mayor Todd Gloria released a $6.4 billion proposed budget last week, revealing a barebones spending plan that shored up public safety, homelessness and road repair and traffic safety, but slashed other services.
Adriana Heldiz
/
CalMatters
“It makes the tough decisions now—including targeted reductions to staffing and support functions—to protect the services San Diegans rely on and keep the city on solid footing,” Gloria said in a statement.
That infuriated arts and culture advocates, who protested that the mayor’s plan would eliminate nearly all arts funding and curtail hours and programs at libraries, parks and recreation centers.
“When we cut the things that make San Diego or any city great, the things that bring us together as a community… I shudder to think what we end up with,” said Patrick Stewart, CEO of the San Diego Library Foundation.
San Diego City Council members were pleased to see strong public safety funding, but aren’t comfortable with dramatic cuts to the arts, council President Joe LaCava said. “People will pull out their pencils and start scouring the mayor’s budget to see if we can tackle that going forward.”
Adriana Heldiz
/
CalMatters
How California cities are falling short
Amid statewide budget woes, San Diego offers a case study in how city spending can fall into the red.
“We’re being hit both on the cost side and the revenue side,” said Alan Gin, an associate professor of economics at the University of San Diego.
Costs are up for everything from car parts for city vehicle fleets to asphalt for street repair, making maintenance and operations pricier, Charvel said. Meanwhile, inflation suppresses consumer spending, tourism and home sales — all key sources of local taxes.
That’s partly due to forces outside local control.
“Federal immigration policy, tariffs and other dimensions of trade policies, are putting cost pressures on deliverers of services in all sectors, and state and local governments are no stranger to that,” said Jeffrey Clemens, an economist with UC San Diego.
A November report by the National League of Cities stated that most cities were bracing for belt-tightening, as they contend with rising costs, infrastructure demands, tariffs and other challenges.
Its survey of local governments found that 55% of cities found it harder to balance their budgets in 2025 than the previous year, compared to just 11% in 2022.
Pandemic aid is expiring as cities confront new budget crunches, said Ben Triffo, a legislative advocate for the League of California Cities.
“I think we’re seeing the slow shift from recovery to restraint,” he said. “Our cities’ revenues are flattening; they’re not keeping pace with the costs.”
In San Diego, property tax growth is expected to slow this year, as the number of home sales drops, Charvel said. The region has a deep housing shortage, and limited inventory with high mortgage rates means fewer homes are selling.
Federal cuts to housing assistance, and inconsistent state funding for homelessness response, have also cost San Diego, LaCava said.
Ongoing inflation, fueled by tariffs and rising gas prices from the war in Iran, is suppressing consumer spending. In San Diego, sales taxes are projected to grow by half the rate they did last year, Charvel said. In 2024, San Diego voters rejected a one cent sales tax by less than one percentage point.
“Consumers are feeling squeamish in the general sense, in particular in the housing market, and that’s creating statewide and national pressures on property tax and sales tax revenues,” Clemens said.
San Diego’s tourism industry is also bracing for a slump; hotel taxes will grow just 1.5 percent this year, down from 6 percent last year, as both group travel and international visitation decline, Charvel said.
“For example, Canadians are boycotting the U.S.,” Gin said. “We’re affected by that in San Diego, because we’re a big tourism destination.”
As revenue stagnates, costs are piling up. The mayor’s office estimates it would cost $118 to $120 million more to run city services at the same level as last year, plus another $26 million for legal mandates, settlements, FEMA accreditation and other fixed expenses. San Diego has a backlog of maintenance for sidewalks and other facilities, and has to meet state mandates to upgrade its stormwater system, Charvel said.
Some critics say San Diego’s spending priorities are misplaced, pointing to bloated middle management and inadequate infrastructure investment. A report released this month by the San Diego Taxpayers Association stated that the city’s workforce has increased about four times faster than its population growth over the last 15 years.
During that period, middle-management positions grew 461%, from 70 to 393, the report stated. San Diego officials pushed back, stating that many of those positions were funded by specific grants, and some had since been reduced.
Other big California cities are also in dire straits. San Francisco’s government spending has far outpaced local tax growth, and the city struggles with federal cuts to food stamps and Medicaid.
Last week San Francisco workers protested the first wave of layoff notices after Mayor Daniel Lurie’s budget office warned departments to prepare to eliminate 500 jobs. The city also plans to cut disability assistance, environmental programs and legal aid.
In February, Los Angeles City Controller Kenneth Mejia wrote that the city is projected to overspend by $200 million, as it contends with last year’s Palisades and Eaton wildfires, “tariff levels unseen since the Great Depression, and aggressive federal immigration enforcement.” In a separate report on the last fiscal year Mejia warned that overspending, rising liability costs and stagnant revenue has led to “crumbling infrastructure and deteriorating services.”
Who bears the brunt of cuts?
As cities try to close their budget gaps, public officials and advocates should think hard about who will fall through the cracks, Clemens said.
“We should be worried that when cuts are being considered, the cuts will be to things that don’t have voices among well-organized stakeholder groups, that are the easiest, from a political perspective, to pull back on,” he said.
San Diego plans to close its budget hole by eliminating 101 jobs, placing employees on furlough for one week per year, and making steep cuts to selected departments.
San Diego’s 37 library branches will have to trim $2.5 million in hours of service, Stewart said, along with programming, books and materials. The city is also ending a matching grant fund that helped libraries drum up private donations. The city council will decide when and where to limit library hours.
The deepest cut was the near elimination of arts funding. The mayor’s budget proposes to zero out an $11.8 million arts and culture grant program, leaving just $2 million in a separate account.
“The mayor is proposing decimating a long-standing, critical source of revenue for what is now nearly 200 organizations across San Diego,” said Jessica Hanson York, executive director of the Mingei Museum and president of the Balboa Park Cultural Partnership, which represents the museums at the city’s historic cultural center.
Many of those provide free events, performances and education programs, she said. In what York called a “double punch,” San Diego imposed controversial parking fees at Balboa Park earlier this year. Since then museum directors have reported a drop in museum visitation, while parking fees are bringing in less money than originally planned.
York questioned whether the $11.8 million savings would provide meaningful relief to the city’s multi-billion dollar budget, but said collateral damage could ripple out to other sectors and dampen spending on entertainment and tourism.
“When you cut quality of life services you absolutely undermine future economic opportunities, revenue, development and investment opportunities,” Stewart said.
At a packed hearing earlier this week, hundreds of residents spoke against gutting the arts program, and the city council plans to hold additional public hearings to refine the city’s spending plan. LaCava hopes to soften the blow of the deepest cuts but acknowledged there will be stark choices.
“Nobody is going to be happy with the budget as it’s going to be adopted in June,” he said. “My job as council president is to make it an open and transparent process. I hope at the end people will feel they had a fair chance to make their case.”
The city is facing a serious budget crisis, and no one who has spent time in public office would suggest otherwise. San Diego is confronting difficult fiscal realities that will require hard decisions about priorities, services and long-term financial stability. But those challenges should not lead elected officials to abandon longstanding agreements or attempt to shift responsibility for the city’s structural problems onto one of San Diego’s most important civic partners.
That is why recent comments from Councilmember Sean Elo-Rivera about the city’s contractual public safety obligations around Petco Park are so concerning. At a time when San Diego is preparing to welcome new Padres ownership, this is not the first impression the city should be making. Suggesting that the city may disregard existing commitments sends the wrong message about whether San Diego is a reliable partner.
Framing this as Padres versus arts and culture is not accurate. The city knows what its contractual obligations are, and difficult budget decisions should not be made by pretending one of San Diego’s strongest civic partners caused the deficit.
It also ignores the Padres’ longstanding commitment to San Diego. Unlike the former San Diego sports team that left the city, the Padres stayed, invested and helped transform East Village into one of the country’s most successful urban ballpark districts. The organization continues investing in the ballpark, the Ballpark District and the broader community while helping shape the area into a vibrant sports and entertainment destination.
The Padres have invested approximately $150 million into Petco Park, improving and modernizing a city-owned facility while creating a thriving destination that supports local businesses, jobs and tourism. In fact, Petco Park was just named Sports Facility of the Year by the Sports Business Journal, underscoring its status as one of the premier venues in all of sports. Gallagher Square has become a year-round public gathering space for families and community events, while the Padres Foundation invests millions of dollars each year in youth sports, education, military families and underserved communities throughout the region.
Public safety around the ballpark is critical to this continued success. Residents and visitors should feel safe riding transit, walking city streets, parking nearby and staying after games and events. The Padres fund substantial police and public safety costs associated with activity inside the ballpark. The city is responsible for policing public streets and maintaining safety in the surrounding public areas. That is not a special favor to the Padres. It is part of the city’s contractual obligations and its core responsibility to maintain safe and functional public infrastructure.
An independent analysis by the San Diego Regional Economic Development Corp. found that Petco Park activity generates approximately $913 million in regional economic impact annually while supporting thousands of jobs and generating millions in tax revenue that helps fund essential public services.
If City Hall is serious about fiscal accountability, it should examine its own spending first. A new San Diego County Taxpayers Association report found that since fiscal year 2021, City Council offices have added 51 positions, a 47% staffing increase, bringing total council staffing to roughly 160 positions and the total council office budget to about $22.5 million. Those additions cost taxpayers nearly $10 million annually, even as San Diego’s population remained essentially flat.
Notably, Councilmember Elo-Rivera approved additional staffing increases for council offices again this fiscal year, even as the city’s broader financial outlook continued to deteriorate. That makes his criticism of the Padres particularly misplaced, given that council operations grew dramatically under his watch, including while he served as council president.
San Diego’s financial challenges are real but solving them will require City Hall to look inward, make responsible fiscal decisions and address the structural issues that created this deficit in the first place.
San Diegans are already facing one of the highest costs of living in the country while watching the city struggle with homelessness, deteriorating infrastructure, public safety concerns and basic services. Residents deserve a serious conversation about how City Hall plans to address those challenges and restore long-term fiscal stability, not attempts to pit civic priorities against one another or shift blame onto longstanding community partners.
Cities earn strong reputations by keeping their word, especially when budgets are difficult. San Diego should honor its agreements.
Roberts was a San Diego City Council member from 1987 to 1994 and a member of the San Diego County Board of Supervisors from 1995 to 2018. Kersey is the president and CEO of the San Diego County Taxpayers Association and a former San Diego City Council member.
CHULA VISTA – Fourteen league and section championship banners hang from the outfield wall at Mater Dei Catholic High School’s softball field. In center field, two replicas of the state of California are displayed on the fence, representing the Crusaders’ two Southern California Regional titles.
Said senior center fielder Bella Harris: “We have a legacy of winning on our home field.”
On a sun-soaked Thursday afternoon, Mater Dei Catholic added another chapter to its home-field history.
Trailing 4-1 going into the bottom of the sixth, the Crusaders scored six runs — five coming with two outs — to rally and beat Point Loma 7-4 in the semifinals of the Southern California Regional Division 1 playoffs.
Mater Dei, the reigning Southern California Division 1 champion, will play for its second straight SoCal championship at home Saturday against La Habra.
“They weren’t going to go down,” said Crusaders co-head coach Liz Centrullo. “They kept fighting. They have the ultimate belief in each other and themselves. That’s what this team does. They do it for each other.”
The Crusaders’ sixth inning began with Oregon-commit Maya Matties lacing a single to left. UCLA-commit Charlize “Chuck” Masingale followed with an RBI double. Sunny Sosa hit a tapper in front of the plate. The ball appeared to glance off Sosa in fair territory, but the umpires ruled it didn’t.
Runners were on first and third with no outs and the score 4-2.
After a fielder’s choice and ground out, the Crusaders still trailed by two, now with runners on second and third. To the plate stepped senior second baseman Liana Quinones.
“This is the turning point of the game,” Quinones said she told herself. “My teammates are relying on me. And most importantly, trusting me. It wasn’t (ital)if (end ital). I had to get it done.”
Quinones hit a hard ground ball that was booted for an error, two runs scoring. Point Loma intentionally walked Arizona-commit Arri Romero, who leads the team with 31 RBI.
Harris ruined the strategy by driving in the go-ahead run with a single.
“There was a lot of adrenaline,” said Harris. “It’s the moment you always train for, practice for and hope for.”
The game marked the third time Mater Dei Catholic (30-3) and Point Loma (24-10) met this season. Mater Dei won all three, 2-1 back in March and 5-3 on Saturday for the San Diego Section Open Division title.
“It’s our first loss like this the whole year,” said Point Loma coach Bill Hunyady. “Usually, we’re able to hold leads. But this is a testament to the best team in San Diego County (Mater Dei Catholic). We had three swings at them and weren’t able to get a win.”
Point Loma took a 3-0 lead in the third inning on a massive three-run homer by left-handed hitting freshman Remington Spangler. The ball sailed over the right-field fence, beyond the bushes, crashing into a tree in a neighboring backyard.
“She roped that,” said Centrullo. “I tip my hat to her.”
Spanger pitched the first four innings, allowing just one run on two hits. But five walks and a hit batter ran up her pitch count. While she came in with a 0.83 ERA and had struck out 85 in 59 1/3 innings, she was making only her second start of the season and tired against the Crusaders.
Point Loma went to its bullpen and Mater Dei rallied.
Minutes after the game, Spangler walked about the visitors’ dugout, collecting her belongings. Asked what was going through her mind after a heartbreaking loss, the freshman said: “That I’m going to miss my seniors.”
I spent time in a hot dog stand on the edge of San Diego Bay, looking out a window that mattered. Mattered to a kid whose mom taught him to fish on this pier. They’d turn on a little transistor radio, find a signal through the static, stare at the water, and talk life and his dad. Dennis Borlek’s dad was out there, somewhere, commanding a naval submarine through god knows what. When his dad would dock in Point Loma weeks or months later, Borlek biked down the street along Shelter Island to see him and steal back stolen moments.
Later, Borlek helped midwife the craft beer scene, managing seminal spots like Small Bar and Liar’s Club. Wondering what to do with the rest of his life, he went back to that pier and saw a for-lease sign on the bait and tackle shop. He tore through the public library and spent the whole night learning how to write a business plan (he had no clue). A couple days later he found himself at the intimidating end of a massive conference table, pitching his dream to the very official Port of San Diego executives.
They gave it to the San Diego kid. Not sure if they ever imagined Fathom Bistro—the tiniest, mightiest craft beer and hot dog stand, filled with spear guns, ocean monster figures, and seafaring oddities—would still be there 13 years later, let alone be a local’s favorite. It’s the most San Diego place in the world. Borlek taught himself to make kimchi and puts it on his Explodo Dog. His friend Kevin, who played with him in a punk band, dresses as a pirate and works the door on weekends. Has done so for years.
And when Borlek stares out the window, he can see the sub base and the memories of his dad.
Later, a few beach towns over, I sat in an employee break area—a shaded back-alley alcove with grape vines that serves as an escape garden for the crew. The place used to be a taco shop. Owner Crystal White points to a window of a single bedroom behind the dough-mixing part of the kitchen. She lived there when she started, often finding herself on the roof at midnight, staring at a broken compressor, trying to will it into working.
A blue-collar kid who fell in love with bread, she moved to San Diego with a business plan and zero cash. Banks don’t loan money to bread dreamers. Fate, kismet, and door-knocking found her enough investors. In the weeks leading up to opening that dream—perfect croissants, kouign-amanns, sandwiches, pizzas, baguettes fermented with wild La Jolla yeasts—she was outside hammering and painting. Locals would pause to ask what she was putting into the spot. “A bakery!” she’d reply.
“Oh, we don’t need one of those,” they’d say. Eight years later, White has moved out of the bedroom, and Wayfarer Bread is one of the best bakeries in the land. I ask if she’ll ever open another location. “I grew up dirt poor,” she says. “This has surpassed even my wildest dreams. This is enough. Please make sure you mention Emma Koehler, K-O-E-H-L-E-R, my kitchen manager. She deserves the credit now.”
These are the people and the stories behind “Best Restaurants.” This issue is dedicated to them, the culture they’ve gritted into being. On the surface, the annual tradition—naming a list of “winners,” my favorite places and my honest answers to “who has the best taco/pizza/Thai…”—is a good-natured competition among friends. But the deeper point is that it’s a way to highlight hundreds of places that have risked it all to build a little magic across the city. Sure, some owners were born in the stars and used that dust to make more stars. But many or most restaurants started with a scrappy go-getter or two. And now those places are filled with dozens or hundreds of people who love the work, show up day in and day out, for years. People like Koehler and the ones we feature in our story, “Behind the Line”.
So please use this list as a beachhead. Try these places, email me ([email protected]) to say “thanks” or “you truly messed up.” Eat, drink, commune, say hello, get to know the stories of the people making your favorite food. Make your own list, and share it with us.
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(Note: Fathom didn’t win anything, probably because there’s no category for “Best Hot Dog Craft Beer Stand on a Pier with a Pirate,” which is a shortcoming on our part. So I put him here because he should be a part of any conversation about best San Diego things.)
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