Homeless aid, emergency funds on chopping block as Los Gatos faces $2 million deficit

SOME OF LOS GATOS’ KEY SERVICES could be cut as the town contends with looming multimillion-dollar shortfalls.

The Los Gatos Finance Commission unanimously recommended the Town Council cut expenses and increase revenues, rather than pulling from its reserves, to address its $2 million budget deficit for fiscal year 2025-26. The commission also recommended a temporary hiring freeze until the projected deficits for the next five years are studied. Those range from $5 million to $6.5 million. The financial fragility is largely due to employee benefits and costs outpacing cash flow in a town heavily reliant on property and sales tax revenue for its $60 million budget in the upcoming fiscal year.