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Home My WebLink AboutMINUTES - 05232006 - SD.5 TO: BOARD OF SUPERVISORS Contra FROM: JOHN CULLEN, 3 . COUNTY ADMINISTRATOR O' -:Ilihn1h; z Costa DATE: May 23, 2006 °°sr�-coUK `P County SUBJECT: MAY REVISION OF THE GOVERNOR'S JANUARY BUDGET PROPOSAL SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION RECOMMENDATIONS: ACCEPT the report on the May Revision of the Governor's January State Budget proposal. BACKGROUND/REASON(S) FOR RECOMMENDATION: Each year the Governor releases a revision to his January State Budget proposal in May. The revision contains revised estimates for revenues and expenditures as well as new policy initiatives and proposals. Attached please find a brief overview of the Governor's May Revise as is relates to County government. CONTINUED ON ATTACHMENT: X YES SIGNATURE: _RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTI-E PROVE OTHER SIGNATURE(S): _ ACTION OF BOA PROVE AS RECOMMENDED OTHER V4 vaa VOTE OF SUPERVISOR I HEREBY CERTIFY`fIIAT THIS IS A TRUE AND CORRECT COPY OF AN ACTION TAKEN UNANIMOUS(ABSENT AND ENTERED ON THE MINUTES OF TI iF, ABOARD OF SUPERVISORS ON T E DATE AYES: NOES: SHOWN. ABSENT: ABSTAIN: },, ATTES'T'ED !� _ dv "v CONTACT:Sara Hoffman,335-1090 JOHN CULLEN,CLERK • 'I IE BOA F SUPERVISORS AND COUNTY ADM1N1 TOR ORIGINATING DEPARTMENT:CAO CC: / G BY ( ` �`;� 13EPI;TY 5/17/06 Overview May Revise On Friday, May 12, 2006, Governor Schwarzenegger released the May Revision to his January proposed state budget. The May Revise contains: ► financial and caseload estimates ► additional Administration proposals for policy initiatives. Revenues and Expenditures Boosted by April tax receipts, revenues are predicted to increase by about $7.5 Billion beyond the January prediction, for the current and budget years combined. Much of the unanticipated cash is being treated as one-time funds, since the Department of Finance doesn't yet have a solid understanding of the underlying reasons for the revenue surge (which primarily came from taxpayers who filed extensions in April). The Governor proposes to use the new revenues to: ► repay or prepay current debt - $3.2 billion, ► reserve - $2.2 billion (will partially fund labor MOU with state employees), ► schools - increase mandated under Proposition 98, ► program augmentations and new initiatives. Total State General Fund resources for 2006-07 are expected to be $100.9 billion, up $8.4 billion from the adjusted estimates for 2005-06. Administrative Program Proposals Listed below are proposals which would have an impact on counties.- Justice ounties:Justice System Impacts ► Mentally III Offenders Recidivism Reduction - $50 million for competitive grants for multi-agency efforts. The new program would be based on the expired Mentally III Offender Crime Reduction Grant Program. ► Citizens' Options for Public Safety/Juvenile Justice Prime Prevention Act (COPS/JJCPA) - additional $42.6 million evenly split between the two programs. This would restore the 2000-01 funding level of $242.6 million. ► Vertical prosecution of certain serious crimes - additional $10.1 million ► Training local sheriffs deputies and probation officers who work in jails and juvenile halls - $19.5 million ► State Prisoner Costs - $19 million to fully fund local agencies for prosecuting prison inmate crimes and housing state inmates. ► Local Detention Facility Fund - $40 million per year for operation, renovation, remodeling, reconstruction, and new construction of detention facilities in lieu of booking fee subventions. A new "jail access fee" would 1 5/17/06 allow counties to charge in lieu of the booking fee only if a local law enforcement agency exceeds its prior 3-year average rate of bookings for certain crimes. The Contra Costa County General Fund will lose approximately $1.9 million in FY06-07 in booking fees (based on 2005-06 booking numbers), if the new Local Detention Facility Fund is enacted as proposed. Health and Human Service Impacts ► Public Health Emergency Preparedness - $400 million one-time for "surge capacity", i.e., the ability to increase patient care capacity during a disaster or an emergency such as an avian flu pandemic. Funding would support: two mobile field hospitals that will increase patient capacity by 400 beds during emergencies; 3.7 million courses of antiviral medications, 7,183 ventilators and masks for emergency and health care workers; medical supplies and equipment for alternate care sites; and funds to develop and maintain hospital surge plans that will be required as a condition of licensing. ► Chronic Homelessness - up to $75 million in Proposition 63 funds to build housing for chronically homeless mentally ill individuals and their families. Funds could be leveraged to ultimately engage $4.5 billion in other funds for this type of housing. ► AB 3632 mental health services for special education students - $69 million for local county offices of education to allocate to county mental health departments and $31 million in Proposition 98 funds for local Special Education Local Plan Areas (SELPAs) for pre-referral services. Another $69 million in General Funds would be directed to county mental health departments for AB 3632 services. However, county departments must enter into agreements with their county offices of education to provide AB 3632 services in order to receive these funds. (Note that Contra Costa County currently has a contract with the Office of Education.) Funds would be allocated based on school attendance numbers of special ed children, with a small county minimum. Note: The Department of Education must audit county mental health departments to ensure that the services match those outlined in the student's Individualized Education Program (IEP). The Revise also suggests that $50 million flowing through the mandates process will offset some of these AB 3632 funds. ► Federal Medicaid Citizenship Requirement- no funding for county administration of the new requirement to prove citizenship. Loss of eligibility could result in increased county costs for health care as well. ► SSI and CaIWORKs COLAS - $43.8 million for the April 2007 SSI cost-of- living adjustment (COLA), but nothing for the CalWORKs COLA (putting the Governor at odds with the Legislature's Democrats). ► CaIWORKs Single Allocation — Under funded by $179 million, according to CSAC. This is the core funding to counties for CalWORKs. 2 5/17/06 ► CaIWORKs compliance with the Federal Deficit Reduction Act of 2005 - $20 million for the Participation Improvement Project competitive grant program to help counties overcome barriers to engaging CaIWORKs recipients in appropriate activities; $40 million in the CalWORKs reserve for a Pay for Performance program that would reward counties in 2007-08 for meeting performance standards in 2006-07. In total, the May Revision reserves $114.6 million to fund future CalWORKs changes, recognizing that pending federal regulations will result in the need for additional changes to CalWORKs in order to comply with the new regulations. General Government Impacts ► Libraries - $7 million for the Public Library Fund and $7 for the Transaction Based Reimbursement Program. ► Property Tax Administration - no funding is provided in either the May Revise or January Budget. FY06-07 will be the second year of the two year suspension of the $60 million allocation. ► Special Elections Reimbursement - no funding is provided for reimbursement of county costs for the November 2005 election. Statewide costs were $45 million. Contra Costa County costs were $2.5 million. State Debt Reduction Strategy The Administration's debt reduction strategy includes: ► Flood control subventions - $100 million to start paying off the $250 million owed to counties and $739,000 for the Department of Water Resources to hire staff to review claims and authorize payment of the subventions. ► State mandate reimbursement - prepay $87 million for the second year of deferred mandate claims (in addition to this year's amount) and $270,000 for a facilitator to lead discussions with state and local officials to reform the state mandate reimbursement process. ► Transportation Debt Restructuring -use a portion of the growing sales tax on gasoline to pay off existing and new transportation bonds instead of following the current "spillover" formula that would send a substantial amount of these dollars to public transportation. 3 CL 0- -i 0 -3 C, co (P. 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