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HomeMy WebLinkAboutMINUTES - 07311990 - 2.6 r * ' a. TO: BOARD OF SUPERVISORS Contra L FROM; Phil Batchelor, County Administrator Costa W DATE, July 31 , 1990 County_ SUBJECT: STATE BUDGET IMPACT SPECIFIC REQUEST(S)OR RECOMMENDATION(S)8 BACKGROUND AND JUSTIFICATION RECOMMENDATION: Accept this report on the impact of the state budget as adopted, on Contra Costa County Government. FINANCIAL IMPACT: Known reductions total approximately $6. 7 million. Additional reductions will be forthcoming when the Governor exercises his line item veto authority. BACKGROUND: The state budget was adopted by both houses of the legislature on Saturday, July 28th. With the exception of the schools, every level of government funded by the state will be absorbing a portion of the reduction. Counties, as expected, are taking a disproportionate share of the total cut, and Contra Costa County appears to be taking a disproportionate cut of the reductions to counties. Statewide, the county impact totals over $555 million in program cuts. This . is offset by new revenue raising authority for counties totaling $201 million, leaving a program impact in excess $354 million statewide. These cuts do not include an additional $417 . 6 million in line item vetoes the Governor intends to make before the budget bill is signed. p CONTINUED ON ATTACHMENT. XYE8 SIGNATURE:* �,✓� -RECOMMENDATION OF COUNTY ADMINISTRATOR _RECOMMENDATION OF BOARD COMMITTEE -APPROVE _OTHER 81QNATURE181: ACTON OF BOARD ON July 31, 1990 APPROVED AS RECOMMENDED X& OTHER X ACCEPTED report; and AGREED to suspend until January 1991 the salary increases for the County Administrator, Health Services Director and the County Hospital Executive Director. VOTE OF SUPERVISORS I HEREBY CERTIFY THAT THIS 18 A TRUE X UNANIMOUS(ABSENT- AND CORRECT COPY OF AN ACTION TAKEN AYES: NOES: AND ENTERED ON THE MINUTES OF THE BOARD ABEENTI ABSTAIN: OF SUPERVISORS OONTHEE DATE SHOWN. Cc: County Administrator ATTESTED al, /990 Health Services Directcr PHILtdATCH99R,CLERK OF THE BOARD OF Audi tor-Con tr o l l er SUPERVISORS AND COUNTY ADMINISTRATOR Personnel Director M382 (10/88) BY �"�� DEPUTY -2- Impacted Areas By far the largest cuts that have been perpetrated on the counties are in health services programs. $175 million statewide was cut from the Medically Indigent Services Program which only totaled .$350 million before the cut, representing a 50% reduction. This cut reduces the total amount of the Medically Indigent Services program to $245 million, or approximately 25% of what the state would have been spending had these programs not been transferred to counties in 1983 . The cut in the Medically Indigent Adult program, our county' s version of the MISP, totals $4. 5 million. The total state funding for this program was $9. 2 million before reductions. Our county received a disproportionate share of the program reductions, based upon the legislature' s decision to protect Los Angeles County and San Francisco County from absorbing the same level of cuts as unprotected counties. Additionally, the AB8 County Health Services ' cost-of-living-adjustment, worth about $700 ,000, has been eliminated. In order to absorb this kind of reduction, wholesale program eliminations will be required. The department' s preliminary review indicates the County' s two major clinics in Pittsburg and Richmond may be .threatened. It needs to be pointed out that program cuts made by the State are effective July 1st, which means that 100% of the program costs are a general fund expense for the entire time before any cuts are made. In addition the cuts in Health Services, the cost-of-living-adjustment for Trial Court Funding as well as 10% -20% of the total allocation have been eliminated. For our county, that totals a $1. 5-$2. 0 million reduction. The legislation appears to give the Board of Supervisors the ability to unilaterally reduce court services in the amount of the cut. It is unknown at this point what program impacts this will have on the courts, but it is expected to be significant. These appear to be two major known reductions that are part of the adopted state budget. Also, the Governor still has $417 million of additional cuts to make to preserve the State' s reserve at $1. 3 billion. There is speculation in Sacramento that the juvenile justice subvention funds and mental health programs will be two targets for significant reduction. County juvenile justice subvention fund cuts could total up to $1,759,000. Included in the current funding for those programs are monies for the district attorney, public defender, several programs in probation, health services, sheriff, and several outside agencies. The largest of the program reductions cuts would come in the Byron Boy' s Ranch program, of which $834,000 in justice subvention program funds currently are allocated. Mental Health cuts are estimated to be in the range $2 to $4 million. It appears that up to $100 million statewide is at risk, and due to the allocation factors in the current program our County stands to loose a disproportionate share of the total that would be reduced. Specific program impacts are unknown at this time, but are obviously expected to be dramatic. Revenue Authority Three new revenue sources have been included for counties in order to offset a portion of the reduction. Two of those, charges for property tax administration and booking costs, are recommended for immediate implementation. Those revenue sources are as follows: -3- 1 . Charging for Property Tax Administration The state budget act gives counties the ability to charge cities retroactively for 89-90 property tax administration which includes the cities ' proportionate share of the Assessor, the Auditor and the Tax Collector, including allowable overhead charges. In addition,, the state will allow counties to bill schools, special districts, and other taxing entities for the cost of property tax administration. This is different than the arrangement with the cities because the first revenues would likely not be seen until later in 1990-91, if at all during this fiscal year, since it would be on a cost billed basis. The State estimates the ability to charge special districts and schools in addition to cities for their fair share of administrative costs would be worth $186 million statewide. 2 . . Charging for the Cost of Booking Prisoners This state legislation gives the county the ability to charge any entity which books prisoners into the county jail for the costs of booking those prisoners, including overhead charges. Booking would include such items as finger printing, providing clothing, medical screening, computer services, deputy supervision time, housing while being booked, electricity, etc. The statewide estimate for this revenue source was $15 million annually. This appears to be a conservative figure. Additionally, the legislature has given counties the ability to implement a utility users tax similar to that available to cities. The utility users tax could include such items as electricity, gas, water, sewer, telephone, telegraph and cable television services in the unincorporated of the County. Questions have been raised about the authority of local Boards to enact these increases, and about the actual amount that would be generated. No revenue estimates were provided by the State due to these questions. County Budget On Monday, August 6th, the public hearing on the proposed 90-91 county budget will begin. It is our strong recommendation that the Board proceed with the budget hearings on the 6th and direct us to make any reductions that are known at that time. Any further delay in adopting the budget will only increase the amount of cuts that have to be made in various departments. A report fully outlining the reductions and impacts will be forwarded to the Board later on in the week for consideration at the public hearing.