By Jorge Casuso

October 24, 2025 -- The City Manager's office on Thursday released an "overarching game plan" for Santa Monica that aims to "restore order, rebuild economic capacity and re-establish long-term fiscal health."

Outlined in a 34-page staff report the City Council will discuss Tuesday, the sweeping plan comes six weeks after City Manager Oliver Chi urged the Council to declare the City is in "fiscal distress."

The plan, issued as Santa Monica "stands at a crossroads," calls for beefing up the police force, boosting misdemeanor prosecutions and relocating SamoShel, the City's homeless shelter, out of the Downtown.

It also calls for reopening all library branches, helping those living in their vehicles find stable housing and expanding a program that offers homeless individuals who have committed low-level crimes an alternative to jail.

The plan proposes to address the City's fiscal distress by maximizing the price developers pay for City owned land, which could generate as much as $200 million for four Downtown properties, and tapping $60 million previously set aside by the Council.

The money would be used to replenish the City's depleted cash reserves and tide the City over as it rebuilds its revenue streams.

"Once the most vibrant and activated destination on the Westside," the staff report states, "the City has spent the years since COVID in a prolonged period of instability.

"Disorder, homelessness, and economic contraction have weakened public confidence. Commercial vacancies, reduced levels of tourism, and physical deterioration of public spaces have reshaped once-lively corridors.

"Meanwhile, fiscal pressures -- including rising costs, slowed revenues, and the childhood sexual-abuse settlements -- have drawn down reserves and created a projected structural General Fund operating deficit of $29.6 million" in the fiscal year starting next July.

Revitalizing the Downtown is a major focus of the plan, which calls for establishing a new Downtown Police Substation at Santa Monica Place Mall staffed by 8 to 10 officers daily, double the current 4 officers, and adding the equivalent of five patrol officers.

The plan also calls for $3.5 million in capital improvements to "refresh aging infrastructure, strengthen the City’s civic identity, and to restore Downtown Santa Monica’s public realm."

The physical improvements include planting trees, repairing sidewalks, repainting crosswalks and replacing old street signage and concrete trash cans.

In a key move, SamoShel would be relocated out of Downtown "to a more suitable site" and its existing "sheltering model" replaced with a “healing center” approach.

The City is also developing a partnership plan with Metro to address homeless passengers who exit at the end of the line station when the Expo line stops running in the early morning hours.

The plan also takes major steps to tackle crime and a persistent homeless problem at a time when "public safety incidents" have become "more visible and volatile" and homelessness has grown "in both scale and acuity."

The plan calls for the City Attorney’s Office to beef up its Criminal Unit in order to prosecute more than 3,500 criminal cases a year for misdemeanors, including Municipal Code violations.

Revenues to pay for the plan's initiatives would come from a variety of sources that include parking rate hikes (about $9 million a year), full cost recovery from the County for the ambulance operator program (about $7 million) and revenues from digital signage ($4.5 million).

The plan also calls for strategic use of the previously allocated $60 million in reserves "as a bridge while sustainable revenue growth measures are instituted," as well as a possible 2026 parcel-tax measure to support ongoing funding to the School District.

The largest revenue windfall, however, would come from "optimizing the development process" in order to maximize "the highest and best use" of City properties.

These includes four Downtown properties, primarily the 2.57 acre site currently earmarked for 362 affordable housing units at 4th and 5th streets and Arizona Avenue in the heart of Downtown.

"If we advance the correct strategy in developing" the four properties, "the City could reasonably expect to create $100 to $200 million in value," according to the staff report.

This would help replenish the City's reserves, which have "eroded from $435.8 million in free cash on July 1, 2018, down to roughly $158 million."

"While the erosion of the City’s cash position is largely attributable to childhood sexual-abuse settlements -- totaling nearly $230 million to date-- it is clear that the City’s fiscal strength has been severely depleted during the past 5 to 7 years," the staff report said.

"The result has been a City that while still rich in potential, has lost much of the focus, capacity, and confidence that once defined it."