Hermosa Beach's budget and taxes, explained
A standing guide · updated June 2026
Hermosa Beach is spending more than it takes in, and the gap is now big enough to reach your wallet — through fees, the hotel tax, and a possible sales-tax measure on your November ballot. This is the plain-English map of the city's money: where the hole comes from, what's already changing on your bill, and the decisions still ahead. Each section links our full reporting.
The hole: a structural deficit, not a one-year dip
Hermosa faces a roughly $3.2 million shortfall in its 2026-27 budget and a projected $19.3 million gap over five years — nearly double its reserves. Costs (a fire contract up 26%, a looming $4.9M county lifeguard bill) are rising faster than revenue. We mapped where every city dollar goes in the budget breakdown, and what the council is actually deciding in the FY27 budget explainer.
What's already changing on your bill
Three things touch residents directly. The city's first fee update since 2016 raises permit and service charges toward their real cost. Newly legal coastal-zone short-term rentals now owe the 14% hotel tax — and the city is chasing an estimated $5 million in back taxes from owners who ran unlicensed. And the June 23 council meeting took up higher parking fines, covered in our meeting digest.
The November ballot question
The biggest lever is a possible 1% local sales tax — about $4 million a year, or $1 on a $100 tab — which the council is weighing for the November 2026 ballot alongside a higher hotel tax. Voters rejected sales-tax measures in 2022 and 2024, but a 2026 poll showed 55% support. The full history, the math, and where each councilmember stands are in our sales-tax explainer.
The big unfunded items
Two capital decisions dwarf the annual budget: a new Hermosa pier (about $58.6M, versus roughly $100M to keep repairing the old one) and a $20M City Yard replacement — both currently without a funding source. They're a big part of why the deficit conversation keeps circling back to new revenue.
How to weigh in
Most of these decisions run through the City Council. Written public comment (eComment) on any agenda item is accepted up to noon on the meeting day, takes about two minutes, and reaches every councilmember before the vote — or you can speak in person at 6:00 PM, 1315 Valley Drive.
What to watch: whether the sales-tax measure makes the November ballot (decided before August), and whether the FY27 budget starts closing the structural gap or patches it for another year.
General information, not advice.
Sources
- City of Hermosa Beach (official) — budgets, agendas, and staff reports
- Each linked Pier to Pier report above carries its full, dated source list.