It soon could become more expensive to stay at hotels in Santa Barbara.

Here’s a buzzkill: Buying cannabis at a city dispensary might cost a lot more.

City workers might be asked to work 32 hours instead of 40 hours per week.

Those are just some of the ideas on the table to help the city financially over the next few years.

Santa Barbara is staring at a budget shortfall of $5.9 million in 2026 and $11.4 million in 2027. The city’s three-member Finance Committee met Tuesday to prioritize some of the ideas for raising revenues and cutting costs.

One of the ideas that has support is increasing the tax rate on gross sales at city dispensaries from 6% to 20%.

“That’s my No. 1,” Finance Committee member and Councilwoman Meagan Harmon said. “Let’s do it today. I feel quite strongly that that needs to be done.”

Harmon also gave her support to a library parcel tax on homeowners to help fund libraries.

“I continue to believe that our library is just an incredible treasure in our community,” Harmon said.

She said she supports a poll to measure support for a library parcel tax and raising hotel bed taxes. Both would have to be approved by voters.

She also supports RV campsites at waterfront parking lots. The RV proposal could create $250,000 to $500,000 annually.

Staring at a large potential budget shortfall, the City of Santa Barbara is considering several revenue increases, including raising transient occupancy taxes from 12% to 16%.

The approved general fund budget for fiscal year 2026 includes total revenues of $243 million and total expenditures of $244.5 million, resulting in an operating deficit that will require the use of reserves this fiscal year.

The full City Council still must discuss the issue. City staff made a list of hundreds of possibilities for cuts and revenue increases.

The city also is considering hotel bed taxes for short-term vacation rentals.

Finance Committee member and Councilwoman Wendy Santamaria expressed early opposition to an increase in the transient occupancy tax.

“I very much want to support our existing hotels,” Santamaria said. “I am very much in our community when I say I don’t think we need more hotels, but the ones that are here should be able to have that revenue generated.”

She said she would like to see the polling for taxing only short-term vacation rentals. People who own short-term vacation rentals, she said, choose to rent them to tourists rather than providing housing to people who need it in the community.

Regarding shrinking worker hours, Santamaria stressed that it only be voluntary and that the city have conversations with the employee bargaining groups to make sure they agree with the proposal.

The city is also considering recruiting more cruise ships to visit the area. The city set a policy of a maximum of 20, and only about 11 are visiting a year.

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