South Bay cities stare down multi-million dollar hike in sheriff’s costs

In an alarming change that could force Cupertino, Saratoga and Los Altos Hills to slash millions of dollars from their budgets or raise local taxes, the Santa Clara County Sheriff’s Office is revamping a long-standing contract that provides those cities with public safety services.

The new contract could potentially raise police costs for those jurisdictions by about a third through 2027.

While the cities assert the contract changes came as a surprise with limited transparency, the county argues that policing has become far more expensive and that these municipalities must now pay for the true cost of the services.

“This is a serious and urgent situation for Cupertino as well as for Saratoga and Los Altos Hills,” said Cupertino Mayor Kitty Moore at a special meeting on Thursday to discuss the contract. “The proposed cost increases are unacceptable.”

For years, the cities of Saratoga and Cupertino and the town of Los Altos Hills have contracted with the Santa Clara County Sheriff’s Office for public safety services because they don’t have their own police forces. The three municipalities had a decade-long contract with the county until 2024 that was extended for two years, and is set to expire at the end of June 2026. As part of the contract, the cities saw costs climb steadily, at a rate of around 5% a year, said Cupertino city staff.

The hikes under the proposed contract represent a multimillion dollar jump for Cupertino and Saratoga and an increase of hundreds of thousands of dollars for Los Altos Hills. In each case, just the rise in cost represents around 5% to 10% of their total budgets.

In municipalities with already tight budgets, these jumps can wreak havoc on financial plans, say city officials. Cupertino has already weighed adding a tax ballot measure, even as city leaders acknowledge that taxes are politically unpopular. Saratoga officials did not respond to a request for comment, but city staff estimated at a recent meeting they could face a $900,000 budget deficit with the increased costs. Los Altos Hills Mayor Rajiv Bhateja said since taxes are likely unfeasible, the hike could force the the town to lay off 10% of its staff or delay key projects like road maintenance.

“It’s not a pretty situation,” said Bhateja. “Fundamentally, the costs are just staggering … For the amount of patrol that we’re getting, the costs are just extraordinarily high.”

According to a statement from the sheriff’s office, the rising costs come from the increased price of labor, more challenges with recruitment and retention, additional state requirements and training, and mandatory technology such as body cameras. The county also stated it had absorbed the increasing costs for years instead of passing them onto the cities and provided certain services for free. While it did not detail how much those costs were in previous years, the county maintained that the contract aimed at recovering those costs.

Without that cost recovery in the new contract, the sheriff’s office said it would have to make its own cuts to essential services.

“The Sheriff’s Office provides exceptional law enforcement services to several cities through contracts that were established more than a decade ago and therefore no longer reflect the true cost of delivering these services today,” said Santa Clara County Executive James R. Williams in a statement. “As these agreements come up for renewal, we are committed to partnering with our cities to ensure full cost recovery in a fair and fiscally sustainable way that reflects our shared responsibility to the communities we serve.”

Officials from Cupertino and Los Altos Hills said they had sought information on the contract since last June, but only received the proposed contract on the evening of December 31. The county asserts that the cities should have been aware of the general scope of the increase since the extension of the contract two years ago – pointing out recent shifts in city leadership. Even so, multiple city officials expressed surprise at the magnitude of the jump.

“If we had known (earlier) … we would have time to explore other options,” said Cupertino Vice Mayor Liang Chao. “The county did not give any indication that the increase would be as drastic as they are proposing.”

Meanwhile, the county faces its own financial hardships. Cuts in federal funding passed last year in the Trump Administration’s landmark spending bill have hamstrung the county’s budget, leading officials to take dire measures and shore up funding. Last year, the county pushed for a temporary sales tax increase, Measure A, to help fill $330 million out of a $1 billion hole in federal assistance to the health care system. And this month, the county approved cutting 365 mostly vacant positions. Even so, they still could face a multi-million dollar budget shortfall next fiscal year until more action is taken.

For now, Cupertino, Saratoga and Los Altos Hills are rushing to negotiate with the county and search for ways to navigate the change. The three municipalities have formed a joint committee which is in ongoing talks with the county. Cupertino is also exploring a slate of options that include creating a new public safety force, contracting with another nearby agency or cutting down on the services they get from the sheriff’s office.

With budgets to be finalized in the following months and the contract expiring in June, the cities say they face a rapidly ticking clock to find the best way forward with the county.

“What we’re dealing with is the lack of time to really look into the methodology,” said Cupertino City Manager Tina Kapoor at Thursday’s meeting. “It’s just such a shift … we’re struggling with the short timing with this.”