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HomeMy WebLinkAboutMINUTES - 06051990 - 1.146 /41 THE BOARD OF SUPERVISORS OF CONTRA COSTA COUNTY, CALIFORNIA Adopted this Order on June 5, 1990, by the following vote: AYES: Supervisors Powers, Schroder, McPeak, Torlakson, Fanden NOES: None ABSENT: None ABSTAIN: None ------------------------------------------------------------------ ------------------------------------------------------------------ SUBJECT: 1989 Grand Jury Report City and JCounty_GbverriTM�ent FinanceE The Board received a report from the 1989 Grand Jury foreman dated May 25, 1990 with respect to County and City Government Finances. IT IS BY THE BOARD ORDERED that the aforementioned report is ACKNOWLEDGED and REFERRED to the County Administrtor and the Internal Operations Committee. I hereby certify that this Is a true and correct copy of CC' County Administrator an action taken and entered on the minutes of the y Board of Supervisors on the date shown. Grand Jur i - �y�p 111t— mATTESTED: , er - - r - mitee PHIL BA HELOR,Clerk of the Board of Supervisors and County Administrator gy - - /w� -- Deputy A REPORT BY THE 1989-90 CONTRA COSTA COUNTY GRAND JURY 1020 Ward Street Martinez, CA 94553 (415) 646-2345 REPORT ON COUNTY AND CITY GOVERNMENT FINANCES APPROVED BY THE GRAND JURY: DATE: 0 cr DONALD G. RA GRAND JURY OREMAN ACCEPTED t�O �J�LI,NG: DATE• NORM& SPELLBERG PRESIDING JUDGE OF THE SUPERIOR COURT SECTION 933 (c) OF THE CALIFORNIA PENAL CODE Sec. 933. Findings and recommendations; cam- ment of governing bodies, elective officers, or agency heads (c) No Iater than 90 days after the grand jury submits a final report on the operations of any public agency subject to its reviewing authority, the governing body of the public agency shall comment to the presiding judge of the superior court on the findings and recommendations pertaining to matters under the control of the governing body, and every elective county officer or agency head for which the grand jury has responsibility pursuant to Section 914.1 shall comment within 60 days to the presiding judge of the superior court, with an information copy sent to the board of supervisors, on the findings and recommendations pertaining to matters under the control of that county officer or agency head and any agency or agencies which that officer or agency head supervises or controls. In any city and county, the mayor shall also comment on the findings and recommendations. All such comments and reports shall forthwith be submitted to the presiding judge of the superior court who impan- eled the grand jury. A copy of all responses to grand jury reports shall be placed on file with the clerk of the public agency and the office of the county clerk, or the mayor when applicable, and shall remain on file in those offices. One copy shall be placed on file with the applicable grand jury final report by, and in the control of the currently impaneled grand jury, where it shall be maintained for a minimum of five years. (Added by Stats.1961, c 1284, § L Amended by Stam 1963, c 674, § 1; Stam 1974, c 393, § 6; Stats 1974, c 1396, § 3; Stats 1977, c 107, § 6.• Stats 1977, c 187, § 1; Stats 1980, c. 543, § 1; Stats 1981, c 203, § 1; Stats 1982, r- 1408, 1408, § S; Stam 1985, c 221, § 1; S=1987, c 690, § 1; Stars 1988, c 1297, § 5.) Former § 933, added by Staa.1982, c. 1408. § 6, amended by Stats.1985.c.221,§ Z,operative Jan. 1. 1989,was repealed by Stats 1987, C. 690, § 2. Former § 933, added by Stam 1959, c. SOI, § 2, was repealed by Stats.1959. c. 181", § 3. REPORT ON COUNTY AND CITY GOVERNMENT FINANCES SUMMMY The incorporated cities in Contra Costa County generally have sufficient income to provide their traditional ser- vices. In contrast, the County government does not have the revenue to provide all of its mandated and optional services at an adequate level. The County and the cities are fostering development and making land use decisions on the basis of tax revenue considerations at the expense of soundly planned growth. The division of responsibilities between the County and the cities needs to be altered. _1_ INTRODUCTION Local government services are supplied to residents of Contra Costa County by several jurisdictions. Public schools, fire protection services, water supply and sewer systems are the responsibility of special districts, which serve geographical areas of varying sizes, but :usually larger than a single city. The justice system (courts, detention facilities and cor- rection programs) , welfare programs, health programs and administrative services such as tax collection, recording of deeds, elections, etc. , are the responsibility of the county government. Public safety (policing, animal control, building inspec- tion, lood control) , road and street maintenance, land use planning and regulation and parks and recreation are the responsibility of city governments in incorporated areas and the county government in unincorporated areas. The library system, which serves the entire County except the ciry of Richmond, is technically a special district but is adm-inistered by the county government. The focus of this report is the financing of the county and city gcvernments, which have seen demands for services grow steadily as the population increases and society changes. FINDINGS 1 . The population of Contra Costa County increased by 15 percent between 1980 and 1989, rising from 672., 300 to 775,500. 2. The number of Contra Costa residents living in incorporated cities increased by 36 percent between 1980 and 1989, going from 463 ,200 to 628 ,100. They now account for 81 percent of county residents. 3 . Ccntra Costa County has become almost a totally urban cv nty. Only about two percent of residents live in rural areas. The other non-city residents live either in identified urban communities, such as E1 Sobrante, Pacheco and Oakley, etc. , or in scattered unincorpor- ated areas surrounded by cities.. -2- 4. Revem.Les of the County government rose by 132 percent between 1980 and 1989, moving from $207. 8. million to $483 million. Roughly half of this increase can be attri!:uted to inflation with the remaining portion const=tuting real growth. TaM R VF11QF5 — 10-YEAR COMPARISON Co=-• 1980 $208 Million 19e9 $483 Mill:cm CovAkr4-=d Cities 1990 $143 Million 1988 $399 Million 5 . Comb:__I�ed revenues of all of the incorporated cities ( 15 in 1980 and 18 in 1989) increased by 178 percent between 1980 and 1989, rising from $143 . 3 million to $398.: million. Again, the increase is about one-half inf la .ion, one-half real growth. 6. Both city and county governments have ' three main sources of income, aside from the occasional sale of bonds for construction and other capital programs. These sources are taxes, grants or allocations f-om other governments and self-generated income, such as user and franchise fees, business license fees, interest, rent, fines, etc. SOURCES OF REVENUE LGrants Taws 522 452 Grants Taxes Self- lr ' elf-generated generated 292 382 192 C�nnt — 1989 Combined ties — 1989 -3- 7. For the county government., grants from other govern- ments are the largest source of revenue, accounting for 65 percent of the total in 1980 and 52 percent In 1990. The second largest source is taxes, which supplied 26 percent in 1980 and 29 percent in 1989. Self-generated income rose from nine percent in 1980 to 19 percent in 1989. 8. For the combined city governments, taxes are the primary source of revenue, supplying 43 percent of the total in 1980 and 45 percent in 1989. Self-generated income accounted for 32 percent in 1980 and 38; percent in 1990, while grants from other governments contributed 25 percent in 1980 and 17 percent in 1989. Lz aEVEM BY TM saw Property +,- 85z other Property Other 8x Z3Z 36%' Sales n County — 1989 Codbizo d Cities —1989 9. County government property tax. revenue rose from $44 . 6 million in 1980 to $121.7 million in 1989, accounting for more than 80 percent of tax revenue in both years. Sales tax revenue is minor for the county government, amounting to $9. 3 million, or seven percent of tax. .revenue in 1989. 10. Combined . city government tax revenue, s more evenly divided, with sales taxes providing 41 percent .in 1988 , property taxes contributing 36 percent and other. taxes supplying 23 percent. 11. The County's two major responsibil ty areas--the justice system and health and human services--consumed 70 percent of expenditures in 1980 and 69 percent in 1989. . In each year the justice system share was 17 percent. 12. Public safety programs consumed 39 percent of the expenditures of the combined city governments; in 1989 and required eight percent of county government out- lays. 13. The County's official budgets and finan=ial reports do not identify the cost of supplying "city" services to residents of the unincorporated areas of the County. -4- 14. Allocations to the library system rose from $5 million in 1980 to $8.8 million in 1989. 15. Despite the growth of the County . budget, many County services are falling below acceptable levels because of insufficient funding. Some examples are: a. Court calendars have become increasingly jammed as the volume of both criminal and civil activity rises at an accelerating pace. b. Juvenile service programs have decreased in both quantity and quality. c. County roads and streets have deteriorated, with 11. 6 .percent of the total mileage . now classified as needing total reconstruction. d. Library hours have been substantially decreased and acquisition .of new books and other materials more and more limited. 16. New and heavier demands for human . services are being made as the numbers of the homeless, addicts, AIDS victims, "crack" and AIDS babies and the medically indigent increase. 17 . Redevelopment projects, designed to reinvigorate rundown urban areas, siphon off property taxes from county and city governments since any increased property tax revenue is reserved for financing the redevelopment costs. The County • Administrator estimates that the County's property tax loss to city redevelopment agencies amounted to nearly $9 million in budget year 1990. 18. Increases in sales tax receipts in redeveloped areas of incorporated cities provide immediate help to the cities, since one cent of the 7.25 cents sales tax per dollar goes to local governments, with the cities getting 97.5 percent and- the County 2. 5 percent. 19. New development such as the building of homes, busines- ses, industrial plants, etc. , on previously undeveloped land generates property taxes immediately upon com- pletion of the development. 20. Both city and county governments actively foster new development in order to increase tax revenue, . with apparent little attention to possible adverse long range consequences of emphasizing short term gains. -5- 21. Expect&;.ions of substantial revenue help from new housing developments may be illusory, as experienced observers believe in many cases the added costs of new service demands will .exceed tax revenue. 22. Proposed annexation by cities of newly developed areas in unincorporated areas of the. County have generated friction between the cities, and the County over tax revenum distribution. 23 . Some California counties have adopted policies to prohib_t or discourage new housing developments not under city jurisdiction. 24. This year Californians will vote on proposals to levy a new 11a.1--ohol" tax and to increase the gasoline tax. If approved, these measures .would be of some help to the County in the areas to which the taxes are dedicated. CONCLUSIONS The 1989-90 Contra -Costa County Grand Jury concludes' that: 1 . The -incorporated cities of- Contra Costa County gener- ally have sufficient revenue to provide essential services and "the .most desired additional services, even though some cities are considerably more affluent than others. 2. The county government does not have the revenue needed to pro,ide at an adequate .level all of the mandated and optional services it currently undertakes. 3 . The health and human services mandated .by the state and federa= governments are not fully funded by those govern=ents and require an. increasing amount..of County funds 4. The ca-snty government. is inherently unable to , provide "city" services as effectively and economically as the cities . 5 . Many Land use decisions : made by the County and the cities arebased on tax revenue generation considerations rather than sound, balanced ' growth principles. 6. The cu--rent division of responsibilities between the County and the cities needs to be altered. -6- RECOMMENDATIONS The 1989-90 Contra Costa County Grand Jury recommends that the Board of Supervisors: 1. Establish a policy that housing developments in zhe unincorporated areas of the County not be permitted unless the development has arranged to be annexed by an incorporated city, incorporates itself or becomes a self-sufficient, urban service area. 2. Take steps to withdraw the County from the provision of "city" services by a combination of the following actions: a. Fostering with all of its authority and influence the annexation of unincorporated urban areas by adjacent cities. b. Facilitating the incorporation of those unincorporated urban areas that resist annexation. C. Establishing unincorporated urban areas that resist both annexation and incorporation as self-sufficient urban service districts, with ..he necessary rearrangement of revenue flow. d. Contracting with incorporated cities for the provision of services to unincorporated areas that remain after the actions listed above are taker.. 3 . Develop and promote a joint powers agreement with -he cities that would establish the library district as a self-governing district, with the County and the cities providing the fund;ng needed by the library sysmem above the tax revenue it currently receives as a special district. 4. Be receptive to and supportive of efforts toward regionalization of selected government services. 5. Intensify its efforts, singly and in alliance with other counties, to achieve state action to alleviate the counties ' burden of partially funding state- mandated programs. -7-