After years of borrowing from reserves to cover expenses, Ventura County supervisors may have no choice but to lay off employees in order to erase a $17.8-million budget shortfall for the new fiscal year, according to the county’s top financial officer.
“You cannot really address the [budget deficit] without dealing with staffing,” Auditor-Controller Thomas O. Mahon told supervisors during their regular meeting Tuesday. “It’s going to have to happen, and it’s going to have to be your board that’s going to have to face up to it.”
Beginning today and running through Friday, the heads of county departments--law enforcement agencies excluded--will present the board with a list of how they would reduce spending in the $870-million budget by 25%.
As the preliminary spending plan was formally submitted to the Board of Supervisors on Tuesday, Mahon was adamant in his call for the elected leaders to drop years of reliance on reserves, excess earnings and other savings to close multimillion-dollar budget shortfalls.
During the last three years, the county has relied on $40 million in reserves to replace property tax money shifted away by Sacramento lawmakers to solve the state’s budget problems. The recession of the early 1990s also reduced local property and sales tax income while increasing the county’s health and welfare caseloads.
In grappling with huge budget deficits over the past five years, county supervisors have relied far less on actual budget cuts than on reserves to solve the county’s budget woes, officials said.
Last year, for example, the board covered a $20-million shortfall by approving just $4.7 million in actual cuts. They simply dipped into reserves and other savings for the rest.
Meanwhile, Mahon said, although the revenue stream from the state continues to be dammed up, county government has continued to grow. Spending is projected to exceed revenue by $31.5 million next year, he said.
Mahon said with 55% of the county’s operating budget spent on staffing, the board will probably be forced to reduce its personnel costs.
Otherwise, he said, avoiding the tough budget-cutting decisions is “sapping the financial well-being of the county,” ultimately hurting the county’s financial clout when it looks to borrow money.
Just last week, the Standard & Poor’s bond-rating agency lowered the county’s credit rating, citing its persistent budget deficit.
Bert Bigler, chief deputy administrative officer, said the supervisors “conceivably” could close the budget gap without layoffs. But if they listen to Mahon, “it’s going to have to affect a lot of positions.”
There are no layoff number projections, Bigler said, but impacts to employees can be minimized by eliminating vacant positions and shifting workers to other departments. The supervisors have routinely chosen this route in the past to avoid actual layoffs.
Public safety and court agencies are immune from budget cuts under county ordinance, leaving other departments to shoulder the burden.
Officials in the county administrative office say the board can wipe out the budget deficit through a 9.22% across-the-board cut to nonpublic safety departments.
Final budget hearings begin June 23, with a public hearing scheduled for 6 p.m.
Hearings will continue until a final budget is passed. Chief Administrative Officer Lin Koester expects approval of a final budget on or before July 1, the start of the new fiscal year.
“We’re going to have to be dead-bang serious in the job we do in the next few days,” Supervisor Judy Mikels said.