The Santa Barbara County Board of Supervisors will hold its hearing today for the adoption of the fiscal year 2020-21 budget.
The recommended operating budget is $1.19 billion, slightly up from the $1.15 billion budget adopted for the current fiscal year, although down from the proposed $1.21 billion budget that was presented to the board in April, said Jeff Frapwell, assistant county CEO and budget director.
The proposed budget includes an estimated $21.7 million in revenue losses for the county due to the COVID-19 pandemic, which includes $3.9 million in lost gas taxes and $5.6 million in more costs for response to the virus. The length and extent of the impacts remain unknown, as is how much federal and state funds the county will receive. State and federal funds make up around 35% of the county’s budget, although negotiations remain ongoing. The proposed budget does not include state or federal funds.
“From our perspective, as you know, this is a very unusual time. We keep saying it’s an unprecedented time, but that seems like an understatement for what we’re going through in the county, obviously in the state and the nation,” county CEO Mona Miyasato said during a webinar on Friday.
Ms. Miyasato noted that while local cities rely on hotel and sales taxes, the county’s revenues are from state and federal sources or property taxes.
The county is aiming to maintain current service levels “to the extent possible,” while continuing to fulfill the board’s commitments and priorities and investing in initiatives that would help mitigate the impacts of a recession. To make up for lost revenue, the proposed budget calls for the use of reserve funds and cannabis tax revenue.
Of the $10.8 million proposed to backfill realignment revenue losses, $3 million comes from cannabis tax revenue, $3.8 million from strategic reserves, $2 million in settlement funds with Southern California Edison, and $2 million in prior-year carryover funds.
In addition, up to $4 million in Public Works’ deferred maintenance funding may be used to backfill gas tax losses, $2.4 million in mental health funds will be used to fund losses in Behavioral Wellness, and $3.6 million of cannabis tax revenue will be used to backfill temporary losses in Proposition 172 Public Safety Sales Tax revenue.
The recommended budget also includes a strategic reserve of $33.7 million, which is 7.6% compared to the board’s 8% target. It also includes a balance of $5 million in the contingency fund, up from $4 million adopted in fiscal year 2019-20.
Essential priorities the board has committed to include construction of the Northern Branch Jail, which is expected to be completed this summer and begin operation in the middle of the fiscal year. The annual operating costs are currently estimated to be $20.4 million, which includes staffing costs to operate and maintain the facility, as well as costs for inmate medical services, food, utilities, and other needs.
With jail population at a historic low due to the pandemic, Mr. Frapwell said there is an “ongoing conversation” with Sheriff Bill Brown to determine funding for the new jail moving forward.
Other capital projects included in the proposed budget include a replacement of the county’s public safety radio, probation department and main jail renovations, infrastructure replacement at Lake Cachuma and an expansion of the county’s Emergency Operations Center.
Mr. Frapwell said he will return to the board in the fall to “take a deep dive” and review the revenues approved in the budget. The board receives quarterly updates on the budget, and Mr. Frapwell said the first quarter report will be “that report on steroids.”
“The first quarter (report) will be really important to watch what’s happening in these first few months in the calendar year,” he said.
While there have been challenges, Ms. Miyasato said the county is “better poised” than in the past and commended the board for building up the county’s reserve funds and using funds for ongoing commitments.
“We’ve been very selective on what we’re doing with the ongoing expenditures, which have poised us to be able to withstand significant downturns,” she said.
The budget hearing is scheduled for 9 a.m. today and will continue to June 11, if needed. The meeting will be streamed on the county’s website, www.countyofsb.org, YouTube and on cable TV channel 20.