The board adopted the $95.6 million spending plan, which bridges a $4.4 million gap between revenue and expenditures by using available carryover fund balances in a variety of operational accounts, $439,280 from Rural Law Enforcement restricted reserves, and $384,800 from general reserves.
“This has been a tough budget year,” said Supervisor Denise Carter, a member of the budget ad hoc committee. “It was difficult trying to make it equitable for everybody.”
Colusa County Chief Administrative Officer Wendy Taylor said spending is up over last year’s budget as a result of cost of living and other salary and benefit increases.
“Salaries and benefits comprise 42.6 percent of the total budget, and have increased 6 percent over last year’s final budget,” Tyler said.
The $95.6 million budget includes all funds, such as enterprise funds, county service areas, special districts, and other reserve funds. The General Fund component of the budget is about $33.3 million.
Tyler said the cost of public protection, roads, and facilities take a bigger chunk of the budget than ever before, with less money available for general expenses and education, such as library funding. Compared to a five-year average, public protection jumped from 69 percent of the total budget to 74 percent, while general expenses dropped from 19 percent of the budget to 17 percent, and education, which includes the libraries and Veterans Services, dropped from 6 percent of the budget to 4 percent. The cost of public ways and facilities increased from 3 percent of the total budget to 4 percent.
“The lion’s share of the budget goes to public protection,” Tyler said. “Out of a total General Fund budget, and approximately $4.4 million of that is carryover used to bridge the gap, public protection is $34.3 million or 74 percent.”
By department, the Health and Human Services expenses will increase from $26.1 million last year to $28.9 this year; Public Works will increase from $12.6 million last year to $16.3 million this year; Sheriff’s Department will increase from $12.6 million to $13.1 million; Behavior Health will increase from $8.1 million last year to $9.1 million this year; and the Department of Agriculture will increase from $3.5 million to $4.6 million.
Some departments had marginal increases or will have reduced budgets.
The Auditor-Controller budget will decrease from $5.9 million to $4.7 million; the County Administrative Office budget will decrease from $4.7 to $4.5 million; the Community Development Department will decrease from $3.1 million to $2.4 million; the Colusa County Library will decrease from $1.6 million to $1.1 million.
Budgets for the Assessor, Clerk-Recorder, County Council, District Attorney, Probation, and Treasurer-Tax Collector had relatively small adjustments in their budgets.
Colusa County funds the equivalent of about 884 full time positions. The county added a library position and a code enforcement officer; the latter something Tyler said has been a priority with the county. Behavior Health also added a number of service positions.
All departments were asked to absorb any increased costs for services and supplies, which means county departments will be left with very little discretionary funding in their budgets for contingencies. As a result, the county budgeted $436,970 for unanticipated expenses, a slight increase over last year, Tyler said.
The 2018-2019 budget also includes $1.4 million in seed funding for new Jail construction; $652,700 in funding for new Tri-Counties Juvenile Facility construction; $655,700 funding for continued participation in the Site Reservoir Joint Powers Authority; $55,200 for Migrant Farm Housing; and $2 million for Other Post Employment Benefits (OPED).
At the same time, the county cut $198,000 in ambulance funding and eliminated the $125,000 in special project funding from the Board of Supervisors. The county was unable to fund requests for new software, a countywide telephone system upgrade, and website upgrades.
While operational costs in general have gone up, General Fund revenue sources have gone down.
Compared to a five-year average, revenue from taxes ($17.3 million) dropped from 65 percent of the county’s total revenue to 60 percent, largely as a result of the depreciation of the PG&E plant in Maxwell, and the reassessment of the Gas Storage facility in Princeton.
“We saw a fairly substantial – about $500,000 – decrease in tax revenue,” Tyler said.
Revenue from the payment of fines and penalties, once 3 percent of the total General Fund, is now 1 percent ($434,000), a common trend everywhere in California.
“When we go back and look at this historically, and you look at the dollar amounts of fines and penalties being ordered and collected, it is diminishing,” Tyler said. “It’s not just a Colusa County problem; it’s a problem statewide that counties are experiencing. The fines are not being ordered at the levels they once were, and collections are not what they once were,” Tyler said.
Revenue from licenses and permits ($700,000) comprise 2 percent of the total revenue, down from 3 percent last year – a result of PG&E recalculation on franchise fees – and charges for current services comprise 5 percent of the revenue, down from 6 percent last year.
Revenue from other government sources ($7.1 million) now comprise 25 percent of the revenue sources, up from 16 percent last year, and revenue from the use of money, which was negligible last year, now comprises 1 percent of the total revenue. Revenue from other sources, which includes the grant for the new jail, comprise 6 percent of the total, down from 7 percent last year.
The good news, Tyler said, is the county paid off a number of bonded debts last year, and has only one remaining debt in the amount $103,000, from a no-interest loan for a 2005 water system improvement project.
Officials, however, are still left contemplating how to dig the county out of a big hole in unfunded pension obligations.
Carter recommended the ad hoc committee meet to begin developing a plan to address the $70.6 million in unfunded CalPERS liabilities and $18 million in unfunded OPED liabilities, which are the differences between what the county has promised its employees and what the plans hold in assets.
Cities, counties and school districts across California are scrambling to deal with the massive liability as CalPERS cost projections and fund management policies swirl, with pension costs anticipated to double by the 2024-25 fiscal year.
According to various studies, voters will be unlikely to support any kind of new tax measures designed to pay down pensions, and public employees will be unwilling to renegotiate, leaving agencies having to reduce services to the public in order to bump up contributions to the benefit plans.
Colusa County in June put $10 million in an irrevocable trust, taking advantage of the booming economy and strong stock market, to offset its OPED liability through more aggressive investments.
“Just that mechanism alone will help bring that liability down,” Tyler said. “That’s really the good news (out of this year’s budget),” she said.
The CalPERS liability, however, is something the county will have to tackle.
“We’re going to have to get proactive like we did with the OPED, and find solutions,” Tyler said.