I go all-or-nothing if I have a situation like this. Instead of cutting funding, just destroy lesser services like libraries and museums. Remove some services completely from any low-density areas. Centralize to the heart of town, and give it some additional money for civics. Yes, give yourself more expenses. This hopefully will keep demand up and let you make large new tax areas to get you back in the green. Also, try to expand industry, since it needs the least ammount of services to keep it happy.