Where’s the beef

Where’s the beef?”  
By: Andy Caldwell
Executive Director, COLAB

 

Remember that commercial that featured the little old ladies at a fast food restaurant asking the question, “Where’s the beef?”  Last week, during the county budget hearings, I kept asking the Board of Supervisors, “Where is the budget surplus”?  Allow me to recap the highlights of last week’s game of taxpayer charade!

 

The Board of Supervisors were told by their staff that they were being presented a balanced budget of $757 million that included an ending fund balance of $6.8 million.  An ending fund balance is financial jargon meaning the county had balanced the budget and set aside an extra $6.8 million that the Supervisors could consider a budget surplus.  The Board of Sups decided to spend a million of this so-called surplus on an ill-fated, ill-conceived health insurance program for kids ostensibly in need of medical care.  That leaves us with a $5.8 million phantom budget surplus.  Allow me to illustrate.

 

The Alcohol, Drug and Mental Health Dept. has a $5 million shortfall.  On top of that, the department owes the county general fund another $1 million that it borrowed to make ends meet last year.  No surplus in that dept.

 

The Social Services Department and the Public Health Dept. are on schedule to run up a $20 million dollar deficit beginning next year.  No surplus in these departments.

 

A special tax the county relies upon to fund a medical trauma center is about to come to an end and the county is going to have to make up the million dollar-plus difference, or see a potential closure of the trauma center.  No surplus there.

 

The county relies upon the Measure D sales tax, to the tune of $7 million a year, to maintain our local roads and provide a match for State dollars for highways and freeways.  Measure D, unless it is renewed by voters, is going to sunset here shortly.  Additionally, the Public Works department has a road, bridge, and sidewalk unfunded maintenance backlog estimated at $203 million.  No surplus here.

 

The county employee pension fund is facing a $200 million shortfall that is the responsibility of the county to make whole.  No surplus here.

 

The sheriff wants to build a $150 million North County jail that is unfunded.  Also unfunded is the $20 million a year it would take to operate the jail.  No surplus here.

 

County Fire needs $23 million for new equipment, building improvements and the like that it doesn’t have.  No surplus here.

 

County Parks is short a mere $43 million it needs for our park system.  No surplus here.

 

The General Services dept. which builds and maintains county owned buildings and properties is short $78 million.  No surplus here.

 

All told, with respect to the documented needs of the county, we only need to come up with an extra $799,767,000 and we truly would have a balanced budget with respect to our current obligations.   Yet, with an extra $5 million that hasn’t yet been spent this year, we are supposed to believe our budget is balanced?

 

So how is the revenue side doing, you ask?

 

On the revenue side, 89% of the county’s discretionary revenue comes from property taxes.  After several years of a meteoric rise in tax revenue, due in large part to real estate speculators driving up the price of real estate in this county, the revenue coming in from property tax is leveling off and is actually beginning to decline in some areas.  Because the county is almost entirely dependent upon this revenue for discretionary spending, it would have been prudent for the Board of Supervisors to create a contingency plan to deal with the impending revenue shortfall.  As the County Taxpayer’s Association pointed out, the fact that real estate prices are coming down in the midst of an otherwise healthy economy spells big trouble ahead, as things can only get worse- especially considering the State budget deficit.

 

So, again I ask, “Where’s the beef, er, budget surplus”?