The Los Angeles City Council Thursday approved a revised $14.9 billion budget for fiscal year 2026-27, preserving the core structure of Mayor Karen Bass’ proposal while making adjustments to reinforce reserves.
The City Council voted 12-1 to approve the revised budget, which increased the city’s reserve fund from $490 million to $515.9 million, and represents about 6% of general fund revenues. The spending plan increased the city’s budget stabilization fund from $9 million to $14.5 million.
Councilwoman Traci Park was the lone dissenter, while Councilman Curren Price recused himself, citing a potential conflict of interest as he is a landlord. Councilman Tim McOsker was absent during the vote.
Revisions bring the city’s cumulative reserve fund from about 8.41% up to 9%. The revised budget is well above a 5% minimum for reserves, but still below a 10% financial policy set by the city.
“Our compliance with fiscal policies directly affects the city’s credibility and borrowing costs, especially as Los Angeles prepares to finance $2 billion for the Convention Center expansion,” City Councilwoman Katy Yaroslavsky, chair of the Budget and Finance Committee, said in a statement.
“This budget sends a clear signal that the city is taking its fiscal responsibilities and its future seriously,” Yaroslavsky added.
Bass is expected to consider the spending plan, and has the ability to approve or veto it.
City Council members touted the revised budget maintains Bass’ proposed goal of hiring 510 Los Angeles Police Officers to keep pace with project attrition, protects core fire department funding, expands the unarmed model of crisis response program, preserves interim housing and homelessness interventions.
It also boosts spending for street cleaning, tree trimming, graffiti abatement, deferred maintenance and sidewalk and other street improvements.
Yaroslavsky said the budget reflects their serious commitment to improving quality of life for residents while also strengthening the city’s long-term financial health.
“We are in a stronger position than last year, but we still face real fiscal uncertainty, rising costs and major threats to future city revenues,” Yaroslavsky said in a statement.
“This budget invests in core services, maintains key investments in homelessness, public safety, fire response and infrastructure, and puts the city on stronger financial footing,” Yaroslavsky added.
Bass and the City Council’s focus on maintaining programs and services without new major spending comes after they grappled and closed a nearly $1 billion deficit caused by overspending, increased liability payouts, fire response and recovery, among other financial challenges.
In 2025, they prevented thousands of layoffs, which were discussed as part of efforts to close the deficit. This year, no new layoffs were discussed.
“During the discussion of the proposed budget, the Budget and Finance Committee indicated that their priorities for this upcoming year were investments that would address the city’s liabilities, those that meet the city city’s financial policies, including capital investments, investments in public safety and shoring up reserves,” according to a memo from Chief Legislative Analyst Sharon Tso.
While Los Angeles is better off this budget cycle, top city analysts have warned elected officials of pursuing major new spending and to be cautious.
On Wednesday, the City Council delayed minimum wage increases for certain hotel and airport workers under the so-called “Olympic Wage Ordinance.” Some tourism-related workers were expected to earn $30 per hour by 2028 for the Olympic and Paralympic Games.
However, council members approved the delay after reaching an agreement with proponents of a proposed ballot measure that intended to eliminate the city’s $800 million-plus business tax. Elected officials had warned it would devastate the city.
Proponents of the ballot measure said they began taking actions to withdraw the measure after the council’s vote. But as city leaders wait to see that official action, they are enacting a cautious plan to defer new programs and phase in new hiring for six months.
The revised budget reduces the size of the first four LAPD recruit classes in 2026-27, and increases the sizes in the second half of the year.
“This brings police hiring in line with the overall goal of the budget to limit hiring until the results of the November 2026 General Elections are known, while not impacting the overall hiring goals of 510 officers in 2026-27,” according to a report from Tso.
Highlights of the revised budget also show funds for hiring 120 firefighters, expanding the unarmed model of crisis response into six new LAPD divisions, and additional funding to give the Department of City Planning and the Office of Finance some hiring flexibility.
The revised budget also provided dollars for a program to support the LGBTQ+ community, known as the “Transgender, Gender Diverse, and Intersex Wellness and Equity Initiative.
City Council members also boosted funding for the spay-and-neuter program under the Animal Services Department, protected the Dogs Playing for Life contract to ensure shelter animals get walked, and money for medical supplies and animal food.
Council members gave authorization for several positions within the City Administrative Officer and City Attorney’s Office to address liability concerns.
While the majority of council supported the revised budget, Councilwoman Traci Park voted against the spending plan over concerns it lacked sufficient funding for the Fire Department.
“Even a year and a half after the Palisades fire, we are still making minimal investment in the LAFD,” Park said. “The department is already mandating holdovers because we don’t have enough staffing, and we aren’t even hiring to cover attrition and retirements.”
Members of United Firefighters of Los Angeles, the union representing LA firefighters, qualified a ballot measure for the November election, which seeks to place a half-cent sales tax that would generate revenue for the LAFD.
Money from the measure would support LAFD hiring, maintaining existing buildings and the construction of new fire stations, as well as the purchase of equipment.
Top city analysts have maintained the budget protects core funding for the fire department. City officials have said they are waiting to see the outcome of the ballot measure to advance improvement plans for LAFD.
“The budget does reflect good work by the committee, and I’m grateful for the improvements, but I remain terribly disappointed and concerned about the necessary investments in public safety and infrastructure,” Park said.