Irvine studies cuts and fee hikes to close budget gap

IRVINE, Calif. — Irvine officials are weighing staff reductions, fee increases and other budget changes under a Target ’28 plan aimed at closing a projected structural deficit by June 2028, according to Voice of OC.

The proposal could affect city staffing, service costs and local programs in Irvine, where staff project an annual deficit of $37 million by July 1, 2028, and as much as $47 million by the end of the decade if spending does not slow.

The Irvine City Council voted 5-2 to have staff keep studying the Target ’28 plan and return in October with more details, Voice of OC reported. The proposal calls for cutting spending by $27 million and increasing revenue by $10 million by 2028.

City staff said Irvine has added 276 full-time positions since 2019. Over the same period, full-time positions rose 28% while the city’s population increased 3%, and salary and benefit costs grew 79%, according to Voice of OC.

Salaries, benefits and overtime make up about 69% of Irvine’s general fund budget. Staff said the city could save up to $17 million in payroll costs, largely through natural attrition and eliminating vacant positions. Irvine has 66 full-time vacancies, a number projected to reach 123 by June 30, 2028.

Irvine City Manager Sean Joyce said the plan would let the city reassess its structure while preserving services. “We have an opportunity through Target ‘28 to look more closely at our organizational structure — including reducing layers of management, spans of control and how functions are organized — and determine where we can streamline and right-size the organization, while continuing to protect core services.” Joyce said, according to Voice of OC.

Councilmembers Mike Carroll and James Mai voted no after backing another motion that included cutting councilmember stipends and eliminating office budgets. “Sure, there’s a technical difference between a tax and a fee, but this is a $10 million tax on our residents, and residents are living through a severe affordability crisis.” Carroll said, according to Voice of OC.

Mayor Larry Agran supported the staff plan while leaving room for changes. “Are there areas where we can make suggestions to strengthen it? Improve it? Make it work better? Yes.” Agran said, according to Voice of OC.

Staff are expected to return to the council in February with updates on sales tax revenue, property tax revenue, retirements and whether the budget targets can be met, according to Voice of OC.