Police officers and city employees in Costa Mesa will be seeing gradual pay increases over the next two years, with biannual 2% bumps coming to some workers.

It comes as Costa Mesa faces grim budget projections, with officials forecasting a $2 million shortfall beginning in fiscal year 2027. 

On Sept. 1, Costa Mesa City Council members signed off on memorandums with three unions: the Costa Mesa Police Association, the Costa Mesa Police Management Association and the Costa Mesa City Employees Association.

According to a staff report, both the Police and Police Management associations will see four 2% pay bumps over the next year and a half, with the first one occurring retroactively on July 1.

They will also see an additional $200 toward healthcare, bringing the monthly total to $2,619 per police association member.

An adjustment in pay is also coming to those who are bilingual, at either 2.5% or 5% of base pay, depending on proficiency.

The City Employees Association will see two 3% increases in the next year.

They will also see a $200 increase in health contributions, starting Jan. 1, 2027, bringing the monthly total to $2,000. In January of 2028, another $200 will be added, making the total $2,200 per month for each union member.

The new period began on July 1 and will conclude in June of 2028.

The increases were included in this year’s budget planning, totalling to nearly $3 million, and will tally up to $3.7 million next year.

Since contract negotiations have been ongoing since June, there was little discussion to approve the memoranda during the Sept. 1 meeting. 

“We did spend a lot of time, and there was a lot of back and forth, but in the end, I feel that it was a great negotiation on both sides, and I’m proud of what we’ve done and I hope the workers on their side are, too,” said Councilmember Loren Gameros at last week’s meeting.

Costa Mesa is one of the few in OC with a balanced budget this year as scores of cities have had to heavily lean on reserves to balance municipal spending.

Yet city officials have projected shortfalls in the coming years, with nearly $2 million anticipated in 2027-28 and almost $5 million by 2029-30.

Costa Mesa city officials also voted on July 22 to put a business license tax increase on the November ballots – one of many OC cities looking to ask voters to decide on potential tax increases this fall.

[Read: Voters Across OC to Decide on Tax Hikes in November Amid Budget Woes]

Passed with a 5-2 vote at the July meeting, with council members Jeff Pettis and Mike Buley voting against the measure, the ballot measure will ask voters if they want to overhaul business license taxes, increasing the maximum tax from $200 to $15,000.

Costa Mesa officials aren’t alone in dealing with bleak budget projections while considering employee raises. 

City officials in Huntington Beach recently voted to give their police union an 18% raise over the next three years.

This year, the city is facing a $15.6 million shortfall, and are using reserves and cutting spending to patch it. 

[Read: Huntington Beach Approves Police Raises Amid Budget Deficit Projections]

Last week, the raise was narrowly approved on a 4-3 vote as questions of the shape of the current city budget led to some concern about passing the raises which could cost almost $10 million over the course of 3 years.