How Morgan Hill is run
Who runs Morgan Hill, what it costs, and where your money goes
The city manager, council pay, the budget, your property tax bill and who provides each service, from Morgan Hill's own public documents. Every number links to its source and says which year it describes. Checked Oct 10, 2026.
Who runs Morgan Hill
A city manager appointed by the council runs the city day to day and prepares the budget. The council of five, the mayor elected citywide plus four members elected by district, sets policy, adopts the two-year budget, and appoints the city manager and the city attorney.
What they are paid
- 12 months' base salary and benefits as severance if let go without cause
- $500 a month vehicle allowance
- Deferred compensation equal to the yearly 457(b) elective deferral limit
- 120 hours of administrative leave a year; up to 240 hours of vacation and leave can be cashed out yearly
- Contract allows a city home loan of up to $1.3 million at 0.94% interest to buy a home in Morgan Hill
- Yearly cost-of-living raise tied to the Bay Area wage-earner price index
- Council budget for conferences and meetings: $25,000 a year (FY2026-27)
Morgan Hill city staff
216 full-time-equivalent positions, including Police 74, General fund (all departments) 125. FY2026-27. Adopted budget positions, all funds. Fire personnel are provided under contract by CAL FIRE. City of Morgan Hill · Jul 1, 2026
The city posts a yearly report listing every employee's pay and benefits by name (calendar 2025), plus all salary schedules. We name pay only for elected officials and the city manager.
Is Morgan Hill in the red?
Cities must pass a balanced budget, so "profit" and "deficit" mean something different here. The useful questions: does the city's everyday money (the general fund) cover its everyday costs, how much does it keep in savings compared with its own target, and how big are its pension and debt bills.
The city's own outlook
The city projects a structural general fund deficit of about $3.5 million a year over this two-year budget, down from about $4.0 million. Reserves are projected to fall below the 25% of revenue goal in FY2028-29 and stay above the 15% minimum until after FY2029-30. The city is preparing for a possible November 2028 revenue measure. City of Morgan Hill · Jul 1, 2026
Savings against the city's own target
Unassigned general fund balance: $28M (2025-06-30). The city's own target: Keep general fund reserves at a long-term goal of 25% of revenues, and never below 15% of revenues, held for emergencies. Falling below 15% requires council action within 30 days; falling below 25% requires a plan by the next budget. City of Morgan Hill · Nov 18, 2025
Why we skip the "budgeted deficit": many cities plan to dip into savings, then spend less than planned. The audited result tells you what really happened.
Where the money comes from and goes
The general fund only: the city's everyday money for FY2026-27.
Comes from
- Property tax$22.8M · 34%
- Sales tax$12M · 18%
- Charges for services$9.8M · 15%
- Franchise fees$3.5M · 5%
- Hotel tax$2.8M · 4%
- Interest and rents$2.6M · 4%
- Transfers in$2.4M · 4%
- Other (gas tax transfer, other agencies, police and fire fees, permits, misc.)$5.3M · 8%
- From reserves (spending above revenue)$5.3M · 8%
Goes to (FY2026-27)
- Police$27.7M · 42%
- Fire and paramedics (CAL FIRE contract)$11.4M · 17%
- Recreation and community services$9.7M · 15%
- Administration and general support$7M · 11%
- Street maintenance$4.8M · 7%
- Other (parks, downtown, economic development, code compliance, transfers)$6.1M · 9%
Your property tax bill: who gets it
California caps the base property tax at 1% of assessed value. Morgan Hill's share of that 1% is about 10 cents of each dollar collected. Voter-approved debt for schools and other districts, and a county levy, add about 0.13%.
0¢
of each property-tax dollar goes to the city of Morgan Hill
- 1% base levy (shared by city, county, schools and districts)The city receives about 10 cents of each dollar1 · 89%
- Schools and other districts (voter-approved debt)0.0855 · 8%
- Santa Clara County (voter-approved)0.0412 · 4%
- Total (% of assessed value)1.1267
FY2024-25 rates for a home in the city of Morgan Hill (Santa Clara County). City of Morgan Hill · Nov 18, 2025
See what a Morgan Hill home costs each year, line by line →Who provides your services
Not everything in Morgan Hill is run by the city. Who provides a service decides whose budget pays for it and whose election decides it.
- PoliceThe cityMorgan Hill Police DepartmentCity of Morgan Hill · Nov 18, 2025
- FireThe stateCAL FIRE, under contract with the CityThe City owns the three fire stations and the apparatus; CAL FIRE provides the firefightersCity of Morgan Hill · Jul 1, 2026
- 911 dispatchThe cityMorgan Hill Police Dispatch (police calls)Fire and medical calls are transferred to other communication centersCity of Morgan Hill · Jul 1, 2026
- WaterThe cityCity of Morgan Hill water utilityAbout 15,300 customers, 16 groundwater wellsCity of Morgan Hill · Jul 1, 2026
- SewerThe cityCity of Morgan Hill (collection)Treated at the South County Regional Wastewater Authority plant in GilroyCity of Morgan Hill · Jul 1, 2026
- Parks and recreationThe cityCity of Morgan HillCity of Morgan Hill · Nov 18, 2025
- City streetsThe cityCity of Morgan HillCity of Morgan Hill · Nov 18, 2025
Compared with similar cities
The cities in this state closest in population that we cover. Read it for scale, not as a ranking: cities provide different services.
| Per city | El CentroCA | Rancho Santa MargaritaCA | Morgan HillCA | BreaCA |
|---|---|---|---|---|
| Residents | 45,716 | 46,217 | 47,074 | 47,656 |
| Top administrator's base pay | $240,000 | $342,047 | $335,464 | $349,620 |
| Council member pay | Not confirmed | $5,562 | $15,300 | $9,888 |
| General fund per resident | $991 | $568 | $1,415 | $1,604 |
| Debt per resident | $5,413 | $125 | $948 | $803 |
| Unfunded pension per resident | $1,259 | $49 | $1,293 | $3,330 |
| City staff per 1,000 residents | 6.0 | 0.7 | 4.6 | 8.5 |
Figures as shown in each city's section, divided by its population. Years differ by state, and pension figures are measured differently in each state (each city page says how). Rancho Santa Margarita and Morgan Hill pays another agency for police or fire, so its own staff count is lower.
What Morgan Hill publishes
What a resident can find online today. A "no" is something you can ask the council to publish.
- Yes: Adopted budget posted onlineThe adopted FY2026-27 and FY2027-28 budget is posted as a PDF and on ClearGov. City of Morgan Hill
- Yes: City manager's contract findable onlineThe city manager's employment agreement is posted on the city's Employee Compensation page. City of Morgan Hill · Dec 23, 2021
- Yes: Council votes recorded member by member onlineMinutes list each member's vote, e.g. all five voted yes to adopt the budget on June 3, 2026. City of Morgan Hill · Jun 3, 2026
- Yes: Council pay stated in a public document City of Morgan Hill · Jun 22, 2025
- Yes: Employee pay publishedThe city posts a yearly report of each employee's pay and benefits by name (calendar 2025) and all salary schedules. City of Morgan Hill
Questions to ask your council
- Reserves are projected to fall below the 25% of revenue goal in FY2028-29. What steps will restore structural balance within three years, as the reserve policy requires?
- The city's two CalPERS plans were $60.9 million short as of June 30, 2025. Does the city plan extra payments to reduce that amount?
- Unassigned general fund reserves were $27,953,342 on June 30, 2025, and the FY2026-27 budget draws $5,343,320 from reserves. In which year would reserves reach the 15% minimum if no new revenue is approved?
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