Banning voters picking a City Council representative for District 4 on November 3 are choosing between incumbent Richard Royce and challenger Marco Santana, both of whom say fixing the city's battered finances is job one. A third name on the ballot, Nathaniel Rodriguez, did not respond to a request for an interview or candidate statement.
The race unfolds against the backdrop of a financial crisis at Banning Electric Utility that has drawn scrutiny from a Riverside County civil grand jury. Royce, who is seeking reelection to Banning City Council District 4, pointed to an audit that he said revealed years of mismanagement, later confirmed by the civil grand jury. That panel's report, titled “Banning: A City Alarmingly Mismanaged” and dated June 8, 2026, raised concerns about improper fund transfers and chronic mismanagement at the utility, according to The Press-Enterprise.
Royce said the mismanagement he referenced included overreliance on unsuitable grants and criminal behavior that resulted in a multimillion-dollar deficit. The grand jury's own findings, reported by the same outlet, show the scale of the slide: the utility's budget surplus fell from $31 million in 2018 to a $9 million deficit by 2022. Royce separately pointed to audited records showing the utility's unrestricted net position dropped from $22 million in 2018 to negative $3.7 million in 2023 — a different financial measure that tracked a similarly steep decline.
Audits Paint a Grim Financial Picture
A forensic audit cited by The Riverside Record found the utility's cash balance fell from more than $20 million in 2018 to roughly negative $9 million by 2023, and that it has carried a negative cash balance since 2022 without the deteriorating numbers being properly reported to the City Council. That same audit found no evidence of fraud or misconduct by former utility director Tom Miller or other utility staff, a notable finding given the grand jury's harsher language about the overall mismanagement.
At a May 14 city workshop, City Manager Elizabeth Gibbs told the council the city was facing significant financial challenges, according to city meeting minutes. A financial forecast presented at that session found expenditures had exceeded revenues for several years and that fund balance levels had declined. Royce said the council has made progress in the 22 months since taking office, pointing to a public utility oversight committee he said he would work to create, a company hired to study utility rates, and a multi-day public workshop held specifically on the budget deficit.
Royce Points to Transparency Moves, Oversight Plans
Royce, a 27-year Banning resident with 32 years of law enforcement experience, said he worked with fellow council members to create and advance the city's Banning 2030 strategic plan, strengthen city leadership, address financial challenges, improve transparency and pass a balanced budget while maintaining essential services. The city adopted that strategic plan, which addresses finances, personnel, equipment, development and information technology, and which Royce says includes guardrails for living within the city's means, balanced budgets and legal compliance.
He said the city restored online meeting options for public meetings, now conducts council meetings twice a month, and that he personally holds periodic town hall meetings and publishes weekly YouTube transparency reports. Royce also said Banning would investigate whether improper transfers from the electric utility to the general fund had occurred in the past — a question the grand jury's report touched on directly, noting officials disclosed the utility may have transferred money to the general fund after Measure P was rejected, in a manner the report describes only in conditional terms regarding possible Proposition 26 implications. Royce told the Press-Enterprise he expects the utility's financial health to be fully restored by June 2028.
On development, Royce said the city should not approve projects that fail to benefit Banning, and that developers should pay for the infrastructure, roads and services their projects affect. His stated priorities for the term ahead include responsible development, public safety, fiscal responsibility, honest government and protecting Banning's future.
Santana Pitches Nonprofit and Workforce Background
Santana, who was born and raised in Banning and graduated from Banning High School, is making his case on a different résumé: years spent in workforce development, housing, education and nonprofit services, during which he says he helped secure millions in local, state and federal funding for the community. He said that experience in jobs, training, education, housing and community services is what he would bring to City Hall.
Santana's priorities include ending the city budget deficit, addressing the utility billing crisis, protecting parks and recreation programs for youth and seniors, improving roads and sidewalks, and attracting businesses that create good-paying local jobs. Within four years, he said he wants Banning to achieve a balanced budget, resolution of the utility crisis, transparent finances, protected essential services, infrastructure improvements, more good-paying jobs and affordable housing. He said success should ultimately be measured by balanced budgets, completed infrastructure improvements, higher-wage jobs created and meaningful neighborhood improvements.
On growth, Santana said he supports development that creates good-paying jobs, affordable housing, businesses and needed grocery stores, while also backing affordable housing and development that protects neighborhoods and natural resources. He said developers should contribute their fair share toward infrastructure and that projects should not harm surrounding home values. When residents push back on proposed development, Santana said he would respond by listening to their concerns, examining the evidence, exploring alternatives, expanding outreach, providing multilingual information and consulting the groups affected. He also said he would pursue outside funding and businesses that bring jobs and revenue to the city.
Beyond District 4: City-Wide Stakes
The city, separately, is considering software updates intended to support and expedite business licensing and permitting, a modernization effort that sits alongside the broader financial repair work both candidates are campaigning on. The District 4 contest is one of two council races on Banning's November 3 ballot; in District 5, incumbent Colleen Wallace is seeking reelection against challengers Chris Castorena and Christian Villagran, according to Banning Record Gazette reporting by staff writer Angelina Parisi.
The utility's finances have drawn attention well beyond City Hall. A Riverside County District Attorney's Office records request in August sought Banning Electric Utility records dating back to Jan. 1, 2018, including financial records, contracts and staff reports, according to Patch. The city said it would cooperate and gather the requested records, and officials noted a Sept. 10 meeting at City Hall was set to include more detailed reviews of internal service and utility funds.
It is not the first time Banning's electric utility has faced outside scrutiny. The City Council approved an earlier audit of the utility back in 2017, according to The Banning Informer, which found the city's Public Works Department had been overbilled $1,276,936 due to incorrect rate codes applied between May 2014 and May 2016. That report also found outdated utility software that could not export data, and the CPA firm involved, Christy White, found no indications of fraud at the time — a finding echoed years later by the newer forensic audit, which recommended considering rate increases and conducting a new cost-of-service study with a capital-needs assessment.
