One-time start-up money: Camera Obscura capital and last year's surplus

Leftover city money from last year, spent once to open the first beds.

What it is

Santa Monica's 2025-26 budget year, which ended June 30, 2026, was on track to bring in more than it spent. In May, city finance staff projected a year-end surplus of $8,949,205. Council had already said $3,000,000 of any surplus goes into a rainy-day account called the Economic Recovery Reserve. That leaves $5,949,205 to carry forward into the new year. It can only be spent once, because it will not come back next year.

The city has already named three uses for $4,670,297 of that carry-forward. The largest is $3.0 million for the Camera Obscura Redesign Implementation, a building renovation in the capital budget. The other two are $1.0 million to replace Fire Department breathing gear and $670,297 to remove and dispose of old firefighting foam, which a regulatory mandate requires. The remaining $1,278,908 has no named project in the budget report (inference: our subtraction).

The Camera Obscura is a pinhole camera from the late 1890s. A turning lens and mirror on the roof project a live picture of the park and the ocean onto a table in a dark room. It sits in a 1955 building at 1450 Ocean Avenue in Palisades Park that was built as the Senior Recreation Center and later became a city art studio, the Camera Obscura Art Lab. The building has been closed to the public since 2020, and by July 2026 the Art Lab had moved to Bergamot Station.

In May 2026 the Council approved a license for the Swiss government to use the building as the House of Switzerland during the 2028 Olympics. The $3.0 million is meant to renovate it first. The city hired an architecture firm in July 2026 and plans to pick a builder in early 2027.

The petition asks the Council to use this one-time money to open the first safe parking and safe sleeping sites and to build tiny homes before the yearly money starts. This page explains both pieces, what they would buy, and what the city would give up.

How it started

The camera dates to 1898, when Mayor Robert F. Jones bought it and ran it on the beach at 10 cents a view. It joined the North Beach Bathhouse in 1899, and the city bought it in 1910 and moved it up to what is now Palisades Park (secondhand, Santa Monica Conservancy). In 1955 it moved into a room built for it in the new Senior Recreation Center, designed by Weldon J. Fulton and given to the city by Marcellus L. Joslyn (secondhand, Conservancy). The city named Palisades Park a landmark in 2007, with the camera and the building listed as contributing parts (fact, July 14, 2026 staff report). The building later became the Camera Obscura Art Lab, a studio for artists in residence, and it has been closed to the public since 2020 (secondhand, Wikipedia). The FY2025-27 adopted budget listed $1,052,876 for Camera Obscura and Art Lab facility maintenance as an unfunded project, and set a June 30, 2026 target to find a public-private partner for the building (fact, adopted budget pp.82 and 283). A Reimagining Camera Obscura study ran in FY2025-26 (fact, CIP p.91). On May 26, 2026 the Council authorized a license with the Swiss Federal Department of Foreign Affairs for June 14 to September 21, 2028, for a $300,000 fee, plus $200,000 if Switzerland takes an optional expansion area (fact). The proposed capital budget, adopted 7 to 0 on June 23, 2026 with no General Fund changes, put $3,000,000 of last year's surplus into the redesign (fact). On July 14, 2026 the Council approved a $613,838 design contract with Omgivning, Inc. without competitive bidding, saying a bid would add six months and miss a June 2027 delivery deadline (fact).

What we take and when

At the mid-year budget review in February to March 2027, the Council moves this one-time money to beds by five votes. The petition counts $2,686,162 of Camera Obscura capital for a tiny-home or site build. That is the $3,000,000 less the $313,838 put under a design contract on July 14, 2026, and it is the most that can still move (inference). Up to $1,278,908 of carry-forward with no named project opens safe parking and safe sleeping before June 30, 2027. This is start-up money only. The yearly cost of running the beds comes from the other lines in the plan.

The numbers today

FY2025-26 General Fund year-end surplus, projected$8,949,205FY2025-26 fact
Set aside for the Economic Recovery Reserve$3,000,000FY2025-26 fact
Carry-forward surplus left after the reserve$5,949,205FY2025-26 into FY2026-27 fact
Named one-time uses of the carry-forward: Camera Obscura $3,000,000; breathing gear $1,000,000; firefighting foam removal $670,297$4,670,297FY2026-27 fact
Carry-forward with no named project$1,278,908FY2026-27 inference
Camera Obscura Redesign Implementation, project C0928, General Fund account C0109280.689000$3,000,000 in FY2026-27; $0 in FY2027-28 to FY2030-31FY2026-27 CIP fact
Already committed from that account to the Omgivning design contract$313,838 (plus $300,000 from FY2025-26 account 01800004.523510; contract total $613,838)FY2026-27 fact
Camera Obscura money not yet under contractabout $2,686,162FY2026-27 inference
Swiss license fee for June 14 to September 21, 2028$300,000, plus $200,000 for an optional expansion areaFY2027-28 to FY2028-29 fact
Unobligated General Fund cashabout $94 millionMay 2026 fact
General Fund operating contingency reserve target15% of next year's budget, reached in FY2026-27FY2026-27 fact
LA tiny home village build cost per bed, nine villages, 1,217 beds$42,344 average; $32,712 to $65,783 range2021 to 2022 secondhand
LA city safe parking rate paid to providersup to $30 per vehicle per night (smaller lots) or $18 (lots of 30 or more)2019 RFP fact

What we give up

The Camera Obscura renovation does not happen before the 2028 Olympics. City staff wrote that missing the June 2027 delivery date risks losing the Swiss license, its $300,000 to $500,000 in fees, and Switzerland's share of the work on the building (fact, July 14 staff report p.3). With the Olympics in summer 2028, a delay likely means no Olympic use at all (inference). The building stays closed longer, and the $313,838 design may need redoing later. On the surplus, we give up the $1,278,908 cushion that would otherwise stay in the bank or go to another one-time need, such as the 15% reserve target.

Why this works

The first beds are the slowest to fund, because yearly money starts July 2027. One-time money opens sites before then. Safe parking is cheap to start: LA paid providers up to $30 a car a night (LAHSA), so 60 spaces cost about $657,000 a year (inference). At LA's 2022 average of $42,344 a bed (A-Mark), $2.69M builds about 63 tiny-home beds on public land (inference). LA's Controller found private-room shelters filled 86% of beds against 65% for shared rooms (audit). Places that added beds saw outdoor counts fall. Culver City paired its camping ban with Homekey units and a safe-sleep village, its unsheltered count fell from 51 in 2025 to 38 in 2026, and 164 people were sheltered by city programs on count night (secondhand, Wave). Houston's unsheltered count rose 15.8% when shelter capacity fell (CFTH). San Diego's downtown drop went largely into safe-sleeping sites (audit). RAND found removed tents turned mostly into vehicles or rough sleeping (RAND). In Santa Monica's 2026 count, sheltered rose by 20 while people outdoors fell by 86 (city).

The strongest case against

This money is spoken for. The Council adopted the budget 7 to 0 with the Camera Obscura in it, approved a license with a foreign government that depends on a finished building, and approved a no-bid design contract because the schedule left no room. Pulling the money now breaks a deal the city made in public, risks $300,000 to $500,000 in fees, and tells future Olympic partners Santa Monica does not keep its word. The building is a contributing part of a city landmark that has sat closed since 2020; preservation advocates and the artists who used it would see an 1899 attraction lose its best chance to reopen. One-time money spent on beds also creates a cost every year: a tiny home village needs staff, meals and security forever, and LA's own audit found tiny home villages had the lowest move-out rate to permanent housing and never filled more than 70% of beds in any year (LA Controller). The $1.28 million is not free either. The city is still rebuilding its reserve to 15%, and the year-end surplus is a projection that may shrink when the books close.

Our answer

Most of this is true, and we rate the Camera Obscura piece low confidence. The license and the design contract are real costs, and the petition counts them: it takes only the $2.69 million not under contract and names the lost Olympic use. We still ask for the money, for two reasons. The fees are $300,000 to $500,000 against $2.69 million of renovation, so the city is paying far more than it collects (inference). And staff list the redesign as an event-readiness project for the Olympics (May 26 report p.7), not a safety repair or a state mandate. On the yearly cost, we agree: these beds only open where the plan already funds their operation, which is the point of the other lines. On the $1.28 million, it has no named use in the budget report, and the city holds about $94 million in unobligated cash, so this take does not threaten the reserve (inference). If the Council keeps the Camera Obscura money, the start-up stack falls to $1.28 million and the first tiny homes wait for another source. We will say that plainly in our comments.

Who decides

Who votes: Santa Monica City Council, seven members. City Manager Oliver Chi and Finance Director Oscar Santiago bring the mid-year budget report and the construction contract to the Council.
Votes needed: Five of seven. City Charter section 1505: after adoption the Council may amend the budget "by motion adopted by the affirmative votes of at least five members" to move unused balances or appropriate available revenue (fact, ecode360 text). The adopted budget says the same: a change after adoption needs 5 of 7 (fact, pp.293 and 295).
When: The construction contract comes back to Council in early 2027 (fact, July 14, 2026 staff report p.3). The mid-year budget review falls in February to March 2027 (inference from the adopted budget's mid-year review). The move has to come before the Council awards the construction contract. The safe parking and safe sleeping sites need to open by June 30, 2027.
Where the rule is written: ecode360.com

The agenda or process

Questions people ask

Isn't this just moving money around?

Yes. It is leftover money the city has not spent yet. We ask that it open beds this spring instead of renovating a closed building for the Olympics. No tax goes up.

Didn't the Council already decide this?

Yes, 7 to 0 in June 2026, and it hired a designer in July. The Council can change its budget by five votes at any meeting. Until a builder is hired in early 2027, most of the Camera Obscura money is not under contract.

Won't we lose the Swiss deal?

Probably. City staff say a missed June 2027 deadline risks the license. The fees are $300,000 to $500,000. The renovation budget is $3.0 million, and $2.69 million of it is not yet under contract. We think beds are the better use, and we say what is lost.

Who pays to run the beds after they are built?

The yearly lines in the plan. This page covers only start-up money. A tiny home village costs money every year, so it opens only where the plan already funds its operation.

Will people actually use the beds?

Private-room shelters in LA filled 86% of beds against 65% for shared rooms. Safe parking serves the people already living in cars here. The petition also requires a monthly public report of beds offered and refused.

Sources

May 26, 2026 staff report, FY2026-27 Proposed Budget and FY2026-28 Proposed CIP$8,949,205 surplus, $3,000,000 reserve, $5,949,205 carry-forward (p.14); $94 million unobligated cash (p.15); three named one-time uses totaling about $4.67 million (p.17); Camera Obscura in event-readiness projects (p.7)
Attachment B, Proposed FY2026-28 CIP BudgetProject C0928, $3,000,000 General Fund, FY2026-27 completion, LA28 purpose, 5,000 square feet (p.91); CIP definition (p.1); no net new operating cost (p.7)
May 26, 2026 staff report, Advancing Major Events (Swiss license)License for June 14 to September 21, 2028; $300,000 fee plus $200,000 option; House of Switzerland; no immediate appropriation (pp.1, 3, 21)
July 14, 2026 staff report, Omgivning design contract$613,838 contract, $313,838 from C0109280; June 2027 delivery deadline; risk of losing the license; construction award early 2027; landmark status; Art Lab moved to Bergamot Station (pp.1 to 5)
July 14, 2026 Council minutesOmgivning contract approved on consent, 7 to 0
June 23, 2026 budget adoption staff reportAdopted budget matches May 26 with no General Fund changes (p.5)
June 23, 2026 Attachment D, final budget changesCamera Obscura $3,000,000 unchanged in the adopted CIP
June 23, 2026 Council minutesBudget adopted 7 to 0
FY2025-27 Adopted Biennial BudgetFive votes to change the budget (pp.293, 295); 15% contingency reserve by FY2026-27 (p.298); one-time revenue for one-time costs; unfunded Camera Obscura maintenance $1,052,876 (p.283); Art Lab partnership target (p.82)
Santa Monica City Charter, Article XV, section 1505Five affirmative votes to amend or supplement the budget after adoption (text read from search excerpt; page blocked direct reading)
March 24, 2026 Realignment staff reportCity lost 4 safe parking spaces east of the border and is seeking a site (pp.46 to 47)
Santa Monica Conservancy, Camera Obscura1898 purchase, 1899 bathhouse, 1910 move, 1955 building, Fulton and Joslyn (secondhand)
Wikipedia, Santa Monica Camera ObscuraApril 21, 1899 installation date; closed to the public since 2020 (secondhand)
A-Mark Foundation, Tiny Home Villages, March 2022$42,344 average build cost per bed; $32,712 to $65,783 range; public land (secondhand)
LA City Controller, Pathways to Permanent Housing audit, December 10, 2024Non-congregate occupancy 86% against 65% (p.10); tiny home villages lowest placement rate (p.13) and occupancy never above 70%; site preparation costs (p.25)
Westside Current on the Controller audit$130,000 per tiny home unit to build (secondhand; not found in the audit text)
LAHSA safe parking report, December 13, 2019Up to $30 or $18 per vehicle per night (p.6)
Wave Publication on Culver CityCulver City unsheltered count fell from 51 (2025) to 38 (2026); 164 people sheltered by city programs on count night 2026
Coalition for the Homeless, Houston 2025 countUnsheltered rose 15.8% when shelter capacity fell
San Diego City Auditor, April 2026Downtown drop moved largely into safe sleeping sites
RAND RRA4903-1Tents removed without places became vehicles or rough sleeping
Santa Monica 2026 homeless count press releaseSheltered up 20, outdoors down 86
Petition city funding ledgerTake sizes and the full list of lines considered

Words on this page

appropriation: The Council's legal permission to spend a set amount on a set purpose.
camera obscura: Latin for dark room. A lens and mirror project a live outside view onto a surface in a darkened room.
capital: Money for building or buying something that lasts, as opposed to money for running it each year.
carry-forward: Surplus money that rolls into the next budget year. It can be spent once.
CIP (Capital Improvement Program): The city's five-year plan for building and repairing things that last, such as parks, pipes and buildings. Projects cost over $50,000 and last more than three years. Only the first year's money is actually approved.
contributing element: A building or object that is part of what makes a designated landmark historic.
Economic Recovery Reserve: A rainy-day account the Council set up. $3,000,000 of the FY2025-26 surplus goes into it.
FDFA: Swiss Federal Department of Foreign Affairs, the Swiss government agency that licensed the building for the 2028 Olympics.
five affirmative votes: Santa Monica's rule for changing the budget after it is adopted: five of the seven councilmembers must vote yes.
fund balance: Money sitting in a fund that has not been spent or assigned. Surplus adds to it.
FY: Fiscal year. The city's budget year runs July 1 to June 30. FY2026-27 runs July 1, 2026 to June 30, 2027.
General Fund: The city's main account. Most local taxes go in, and police, parks, libraries and most staff are paid from it. The Council can move money in it by vote.
Homekey: A California program that pays cities to buy motels and other buildings for homeless housing.
LA28: The 2028 Summer Olympic and Paralympic Games in Los Angeles.
license agreement: A contract letting someone use city property for a set time and fee, without owning or leasing it long term.
mid-year budget review: A report halfway through the budget year where staff update revenue and the Council can change spending.
one-time money: Money that arrives once and will not come back next year. City policy says it should pay only for one-time costs.
operating contingency reserve: The city's main emergency reserve. Policy says it should equal 15% of next year's General Fund budget by FY2026-27.
RAND: A nonprofit research organization in Santa Monica that runs its own homeless counts and studies.
reserve: Money the city keeps unspent on purpose for emergencies or a downturn.
safe parking: A lot where people who live in a car can park overnight with toilets, staff and help finding housing.
safe sleeping: A managed site where people sleep in tents with staff, toilets and services, instead of on the street.
surplus: Money left over at the end of a budget year because revenue came in higher or spending came in lower than planned.
tiny home village: A site of small locking cabins, usually 64 square feet, with shared bathrooms, meals, security and case workers.
unobligated cash: Cash the city holds that is not tied to a contract or a bill. Staff put it at about $94 million in May 2026.