Cupertino’s sheriff contract hike upends budget

Cupertino is looking at a problematic increase in its contract with the Santa Clara County Sheriff’s Office, its public safety arm. The situation could force the city to consider a tax increase or budget cuts.

Rather than maintain its own police force, Cupertino has always contracted with the sheriff’s office to provide law enforcement. The city pays $18.6 million per year for the service, which the county said doesn’t fully cover its costs. The county’s proposed contract for the 2026-27 fiscal year, starting July 1, seeks $25.3 million annually — an increase of $6.7 million or 36%.

Two other West Valley cities — Saratoga and Los Altos Hills — also rely on the sheriff’s office and are looking at similar hikes and financial pressures.

While the county warned the three West Valley cities two years ago that it would stop partially subsidizing the sheriff’s services in mid-2026, the outcome is much more than expected. Cupertino had planned for a 5% to 20% increase.

“(The 36% hike) is significantly higher than anything the city could have anticipated and represents a substantial fiscal impact for the city,” Cupertino City Manager Tina Kapoor told San José Spotlight.

The Cupertino City Council had a preliminary discussion Jan. 13 on how to cover the cost, directing city staff to research two options: a variety of tax increases, some of which would require voter approval, or reduced services. Councilmembers conceded getting residents to approve a tax increase would be an uphill battle.

“We simply can’t put something on the ballot without having proof to the public that this is really necessary,”  Mayor Kitty Moore said at the meeting.

Kapoor said Cupertino is expecting a $4.5 million budget surplus in fiscal year 2026-27. That follows an earlier $30 million loss, largely due to a depletion of sales tax revenue from tech giant Apple during prior years. The city credited the reversal to an array of cost-cutting measures.

While the projected surplus may help offset some of the increased cost with the sheriff’s contract, Kapoor said it only offers one-time relief.

“The more significant concern is that any substantial and ongoing increase to the contract would result in a structural deficit for the city, a fiscal imbalance that is not sustainable in the long term without new (or) increased revenue sources or a decrease to service levels,” she said.

The council will continue its public deliberation on the sheriff’s contract and the resulting budget squeeze at its Feb. 19 meeting.

Santa Clara County is tackling financial challenges in the upcoming fiscal year due to a reduction in state and federal funding. The sheriff’s budget for fiscal year 2025-26 was roughly $589 million.

“Given the county’s current budget, our goal is to recover the full cost (of serving the West Valley cities) while continuing to provide high-quality, cost-effective public safety,”  Sgt. Brooks Jarosz, spokesperson for the sheriff’s office, told San José Spotlight. “Since our last contract, policing in California has changed significantly.”

Jarosz said state mandates have expanded training requirements and technology that includes body-worn cameras, while salaries and benefits have also increased.

The sheriff’s West Valley Patrol Division is located in Cupertino and has a staff of 83 deputies and seven support personnel.

The situation is now getting attention from the county Board of Supervisors.

“As much as I favor cost recovery, trying to make up the cost all at once is difficult for any city,” District 5 Supervisor Margaret Abe-Koga, whose district covers the three cities, told San José Spotlight. “I am talking to staff about exploring the ability to phase in the increases so that cities can manage their budgets predictably.”

Cupertino, Saratoga and Los Altos Hills formed an ad hoc committee earlier this month, consisting of each municipality’s mayor and city manager, to plan how to negotiate with the county on reducing the financial impact.

Saratoga is spending $9 million a year for the sheriff and will face a 36% increase. Los Altos Hills is spending $2.8 million for public safety with a 30% increase set to kick in.

“The proposed increase comes at a time when the city of Saratoga is already projecting future budget constraints, which makes additional cost pressures particularly challenging,” Saratoga Mayor Chuck Page told San José Spotlight.  “While no specific actions have been determined, significant increases in ongoing expenses limit the city’s fiscal flexibility and may require difficult budgetary decisions.”

Contact Mike Langberg at [email protected].