SATURDAY, JANUARY 31, 2026 VOLUME 20 NO. 5VOLUME 20 NO. 5 
CITY COUNCIL CONSIDERS GANN LIMIT INCREASE 
SATURDAY, JANUARY 31, 2026 VOLUME 20 NO. 5VOLUME 20 NO. 5 
CITY COUNCIL CONSIDERS GANN LIMIT INCREASE 
Fiscal Year 
MEASURE FOR JUNE BALLOT 
By Kevin McGuire 
City Council is being asked to consider placing a Gann Appropriations Limit increase measure on the June 2, 2026, statewide primary election ballot, 
as Sierra Madre approaches its constitutional spending limit and faces growing fiscal constraints in the coming years. 
During the regular meeting on Tuesday, January 27, City Manager Michael Bruckner presented in his report that while Sierra Madre has remained 
in compliance with the Gann Appropriations Limit for the past five fiscal years, the margin between allowable spending and actual appropriations 
has narrowed significantly. Projections indicate that, without voter authorization, the City could exceed the limit as early as fiscal year 2027–28, even 
without adding new services or programs. 
The Gann Appropriations Limit, named after political activist Paul Gann, was established under Article XIII B of the California Constitution in 1979 
and restricts how much revenue from certain taxes a city may spend each year. The limit increases annually based on population growth and inflation. 
While it does not cap total revenues or reserves, it constrains the amount of tax revenue that can be allocated to public services. 
According to the City’s analysis, rising costs for labor, pensions, healthcare, and routine capital needs are outpacing the growth permitted under the 
constitutional formula. In fiscal year 2024–25, the City’s available margin under the Gann Limit dropped to less than one percent. Although one-time 
capital expenditures in FY 2025–26 temporarily increased the calculated limit, long-term forecasts show continued pressure. 
Using conservative assumptions, staff projections show that under a baseline scenario (see Table 2) of four percent annual growth in tax-funded 
appropriations, the City would reach the Gann Limit by FY 2028–29. Under higher-cost stress scenarios, the limit could be exceeded one to two years 
earlier, potentially triggering mandatory refunds or reductions in appropriations under state law, as set forth in the California Constitution. 
Table 2: Scenario A - Baseline Forecast Fiscal Year Gann Limit Growth 
Gann Limit Growth @ 2.5% Scenario A: Appropriations 
Growth @ 4.0% 
Margin (A) 
2025-26 Base 
Year 
$ 14,622,105 $ 14,201,403 $ 420,702 
2026-27 $ 14,987,658 $ 14,769,299 $ 218,359 
2027-28 $ 15,362,349 $ 15,360,471 $ 1,878 
2028-29 $ 15,746,258 $ 15,974,890 $ (228,632) 
2029-30 $ 16,139,464 $ 16,613,485 $ (474,021) 

Exceeding the limit could constrain the City’s ability to deliver services and capital planning and reduce the City’s ability to respond to community 
needs, according to the City Manager. “Because we are doing less with less money,” Bruckner noted. 

To avoid those outcomes, Bruckner recommends that the City Council seek voter authorization to temporarily increase the Gann Limit by approximately16 percent, or about $2.4 million, over a four-year period. The proposed increase is designed to accommodate normal economic variability and 
unavoidable cost pressures, not to authorize new taxes or expand services, according to the staff report. 

Bruckner emphasized that a Gann Limit increase does not raise tax rates or create new taxes. Instead, it allows the City to spend revenues it alreadylawfully receives but would otherwise be prohibited from using under the constitutional cap. Any increase approved by voters would automatically 
expire after four years unless renewed through another election. 

Placing the measure on the June 2026 statewide primary ballot is expected to cost approximately $60,000, according to Los Angeles County estimates. 
City staff noted that a statewide election typically results in higher voter turnout and lower incremental costs than a standalone municipal election. If 
the Council moves forward, a supplemental budget request would be included in the FY 2025–26 midyear budget, according to the report. 

The deadline to place a measure on the June 2026 ballot is March 6, 2026. 

Bruckner noted that pursuing a Gann Limit increase aligns with the City’s Strategic Plan goal of maintaining long-term fiscal stability and ensuring 
the City can continue to deliver services and plan capital improvements without disruption. 

City Council unanimously agreed on the placement of a Gann Appropriations Limit Increase Ballot Measure at the June 2, 2026, Statewide PrimaryElection. 

A MESSAGE FROM CITY MANAGER MIKE BRUCKNER 

Dear Sierra Madre, 

As we begin the new year, I want to wish everyone in the Sierra Madre community a happy and healthy 2026. 

Over the past seven months it has been an honor to serve as your City Manager. In that short time, I have 
come to learn what many of you already know: Sierra Madre is a truly special place—a charming, engaged, 
and deeply caring community with a strong sense of identity and pride in its traditions and hope for its 
future. 

As we look to the year ahead, the City is entering an important financial planning period. 

In October 2025, the City’s newly retained financial advisory firm presented a ten-year financial forecast 
showing projected budget deficits in the years ahead. These projections reflect rising costs, limited revenue growth, and long-standingfiscal pressures that many local governments are facing across California. 

While the City continues to meet its obligations, the adopted budget for the current fiscal year includes a $1.4 million deficit, and longer-
term projections indicate continued fiscal stress in the General Fund. 

The City Council will be considering recommendations from the Ad Hoc Revenue Committee at its February 10th meeting as part of 
the midyear budget review and will be deliberating on a fiscally responsible framework for development of the FY 2027 budget. These 
conversations will help guide future budget priorities and how City services are aligned with available resources. 

As we begin this deliberative process, community input is essential. Sierra Madre’s strength has always been its residents’ willingness to 
engage, volunteer, share ideas, and help define what matters most. I encourage community members to share their thoughts and priorities 
as we work together to understand how best to align limited resources with the services and investments our community values. 

I look forward to working closely with the City Council, staff, and the community as we navigate these decisions together. With open 
dialogue, shared responsibility, and a focus on what makes Sierra Madre unique, we can preserve, protect, and enhance the qualities that 
make this community such a special place to live. 

Thank you for your engagement and your continued commitment to Sierra Madre. 

Compass is a real estate broker licensed by the State of California and abides by EquaHousing Opportunity laws. Lic. #01991628. All material presented herein is intended forinformational purposes only and is compiled from sources deemed reliable but has not beenverified. Changes in price, condition, sale or withdrawal may be made without notice. Nostatement is made as to accuracy of any description. All measurements and square footageare approximate. If your property is currently listed for sale this is not a solicitation. 
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