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|Solano County Budget Overview|
The economic downturn continues to impact the County in several ways, including:
- $6.4 billion reduction in the secured assessment role from the housing market peak in FY2007/08 thru FY2011/12, which equates to about $21 million less in property tax revenues in FY2011/12 than we had five years ago.
- State and federal budget reductions - past and pending - create constant uncertainty
- Delayed cash flow and credit crisis are reducing interest income
- Reduction in retail sales are impacting funding sources for local programs including public safety, health and public assistance
- More people are finding they are in need of County-paid "safety net" services
For all of these reasons, County revenues are not keeping pace with the cost of providing current services. This means the County must continue to reduce its ongoing costs and adjust services to live within our means.
What has the County done so far to reduce costs?
Since the early 1990s the County has maintained a General Fund Five-Year Fiscal Projection, and the Board has adopted comprehensive policies on the use of Reserves and Contingency funds. This strategic fiscal focus has enabled the County to maintain one of the highest bond ratings among California counties. With this tradition in place, the County has addressed and continues to address the loss of revenues through a series of budget reduction efforts.
The following are some of the actions that the County has taken to align its ongoing expenses with ongoing revenues:
- Maintained a hiring “freeze” since early 2008
- Reduced the size of the workforce by 21% or 644.5 positions since the FY2008/09 Adopted Budget
- Active talks with employee bargaining units to reduce labor costs, resulting in reductions in salary and benefit costs from 35% of the work force. Click here for more details on the labor negotiations efforts.
- Reduced contracts by 10% or more where possible
- Eliminated or deferred equipment purchases where appropriate
- Conducted a series of budget workshops to strategically reshape County government going forward
- Learn more about the reduction efforts to date: FY2009/10 Reductions, FY2010/11 Reductions, and FY2011/12 Reduction
What reduction efforts are in the works?
- The FY2011/12 Adopted Budget was prepared with no increases over the reductions made in FY2010/11 and in anticipation of potential reductions in the next 18 months to two years, which means the departments had to absorb the cost of any scheduled cost of living allowances, increased retirement and health benefit costs, as well as other operational cost increases.
- General Fund expenditures in FY2011/12 are down $12 million less from FY2007/08, the peak of the housing market. At the same time, General Fund revenue projections show the County will receive about $31 million less than received in FY2007/08.
- Based on the County's General Fund Five-Year Fiscal Projection, the FY2011/12 Adopted Budget includes a General Fund structural deficit of $19.7 million, which means the County's ongoing expenditures exceed its anticipated revenues. This is being mitigated with a draw of $6 million from General Fund Reserves and $13.7 million from other one-time revenue sources.
- Series of workshops are being planned for this fall that will focus on strategies to implement $10 to $12 million of further reductions in ongoing operating costs this fiscal year. In addition, these strategies have to account for increased costs from Phase I realignment of public safety programs and other impacts from further state and federal budget reduction efforts.
Additional Questions and Answers
Updated: July 29, 2011