Sacramento council member floats cutting homeless agency in $66M budget crisis
Sacramento Councilmember Phil Pluckebaum floated cutting the city’s entire homeless agency during a Tuesday council meeting amid discussions to balance its budget deficit. He has now rejected that idea — but he still believes change is necessary to better help unsheltered residents.
The City Council was having its first discussions exploring how to balance a $66.2 budget shortfall on Tuesday. City Manager Maraskeshia Smith has proposed cuts that include laying off or demoting 37 employees, cutting violence prevention grants and shortening neighborhood pool hours. The layoffs would be the first in over a decade for the city.
But council members wanted to consider different budget balancing solutions than those offered by Smith. Sacramento Mayor Kevin McCarty urged each official to submit alternative cuts. That’s when Councilmember Phil Pluckebaum unveiled his novel idea.
Pluckebaum noted that his colleagues must find $66.2 million in savings for the fiscal year that starts July 1, and the following year city officials anticipate yet another budget deficit, a $35.4 million shortfall.
So, Pluckebaum mused, why not cut the combined amount — $101.6 million — this year to help “reset the city’s stable staffing model,” he said.
Then, on July 1, 2027, City Hall would be about $35 million ahead since the council prematurely cut expenses, he said. He later said employees are left in limbo year after year as the budget crisis threatens jobs, which is an irresponsible approach.
“If we make the hard choice now and reset the city’s budget to a level that we can afford … not only do we yield the benefit of that savings this year … we have a roughly $35 million of surplus to reallocate,” he said.
On the dais Tuesday, Pluckebaum floated how the city could save $35 million.
“You can just take it all from DCR,” Pluckebaum said, referring to the Department of Community Response.
DCR, with an annual budget of $41.5 million, provides the city’s homeless response services. The city has about 1,375 beds in its Roseville Road, X Street and Meadowview shelters.
In an interview on Wednesday, Pluckebaum walked back his statements. He said finding $35 million cuts from DCR is not responsible this year and is heartless. “It was a little inflammatory of a statement,” he said.
“I am not trying to be uncompassionate,” he added.
Pluckebaum on Wednesday referred to how Gov. Gavin Newsom allocated $500 million in homelessness grants this year, down from $1 billion in previous years. The city of Sacramento has no idea how much state funding it will receive.
Sacramento must do more with less, according to Pluckebaum, which is why he instead seeks to restructure DCR. “We are not at ‘functional zero,’” Pluckebaum said, using a term that means a community has essentially eradicated homelessness. “We’re not even close.”
Pluckebaum’s idea comes as the council is scheduled to adopt its budget by June 9. Asked if city staff can find $35 million in cost-savings by next month, a spokesperson expressed optimism.
“Anything is possible if the council votes on it,” wrote city spokesperson Jennifer Singer in an email.
Other council members did not voice support for Pluckebaum’s idea to scrap the Department of Community Response. But Councilmember Karina Talamantes said she hopes to reduce how much money is spent on homelessness, and not completely eliminate the department.
“Obviously we still need to continue (funding homelessness services), because it is a priority for all Sacramentans,” she said. “But I think that we need to cap how much we spend on it every single year.”
Sacramento County’s Health and Human Services Department — which in part offers mental health services — should be the main agency on overseeing homelessness, she said.
“If we don’t cap it and we don’t control ourselves and our budget … we are just going to continue to spend more and more and more on it,” Talamantes said. “There’s going to be no way of exiting this … it’s going to wipe out our entire city of Sacramento budget.”
The city has also increased homelessness spending year after year. The budget proposal forecasts spending about $48 million for homeless services, without a guarantee of state funds, in the next fiscal year.
The council is scheduled to discuss the budget throughout meetings in May.
